Albania among Bank Based System’s Countries

Abstract

The Albanian financial system has entered a new phase of its development. Financial system in Albania is bank oriented, as financial market is not active. Because of the important and deep changes that have altered the image of the banking system, the conditions for more dynamic development of non-banking intermediaries and capital markets have been created. The analysis is based on the standard indicators of size and activity of banking intermediaries. The results of the analysis show that the size and activity of Albanian banking system is growing faster but limiting the crediting process only on banks. However, the achieved level of development of banking intermediaries is still below of other advanced transition economies. Albanian financial system needs to develop quickly the activities of pension funds, investment funds and bond/asset markets in order to create great opportunities to the Albanian economy.