Albania Westernizes Banking System

TIRANA, Albania -- Albania's central bank has approved guidelines for the creation of private banks to bring Albania into line with the international financial system, a Bank of Albania official said Thursday. "The rules will make the Albanian banking system conform to the world financial system," said Bedri Collaku, head of the Bank of Albania's Financial Supervision Departments. "A modern and stable banking system will help our emerging market economy here," he said. Under the new package, a minimum initial capital equal to $500,000 in Albanian leks is required to open a cooperative-type rural bank. For other types of banks, depending on size and variety, it ranges from $1 million to $7 million. Banks can be private, state-owned, joint ventures or local branches of foreign banks. They can function in the form of corporations or partnerships and can be national or regional, according to their size.Under the four decades of Communist dictatorship ending in 1991, Albania had only a primitive banking system serving the basic needs of the centralized state-run economy. Now the Bank of Albania serves as a central institution to a savings, a commercial and an agricultural bank. All are state-owned.