Other measures and activities

Published: 14/12/2017 Modified: 20/1/2021

Decision on a temporary restriction of distributions

To enhance credit institutions’ resilience and maintain financial system stability during the COVID-19 pandemic, the Decision on a temporary restriction of distributions imposes a restriction on credit institutions' distributions until 31 December 2021, which includes dividend distribution, creation of an obligation to make dividend distribution, redemption of own shares, award of variable remuneration and other forms of distributions.

The COVID-19 pandemic has had large negative effects on economic activity in the Republic of Croatia, which have prompted a range of measures to support credit institutions and their clients, such as monetary policy measures aimed at maintaining favourable financing conditions, tailored supervisory approach and relaxed regulatory framework for the business of credit institutions, and public policy measures to support the affected sectors. Nevertheless, the uncertainties regarding the impact of the current emergency health and economic conditions on the business of credit institutions in the Republic of Croatia remain high. Amid such conditions, the temporary restriction of distributions will strengthen credit institutions' resilience to possible losses in connection with the materialisation of the credit risk on credit institution's balance sheets. The Croatian National Bank will monitor closely the health and economic developments and will, at the latest until 30 September 2021, review if the grounds that prompted the adoption of this decision still exist and it may accordingly revoke the Decision before its expiry.

The Croatian National Bank has adopted the Decision on a temporary restriction of distributions in compliance with the provisions of the Recommendation of the European Systemic Risk Board of 15 December 2020 amending Recommendation ESRB/2020/7 on restriction of distributions during the COVID-19 pandemic.

Decision on a temporary restriction of distributions (OG 4/2021)


Recommendation on actions in granting non-housing consumer loans

In efforts to mitigate credit risk in consumer loans, as part of its task of contributing to the stability of the financial system as a whole and in line with pursuing an intermediate macroprudential policy objective, the CNB recommends to all credit institutions providing lending services to consumers in the Republic of Croatia that, in determining a consumer’s creditworthiness for all non-housing consumer loans with original maturity equal to or longer than 60 months, they take into consideration minimum costs of living that may not be less than the amount prescribed by the act governing a part of salary exempted from foreclosure.


Recommendation to mitigate interest rate and interest rate-induced credit risk in long-term consumer loans

In efforts to mitigate interest rate risk for consumers and interest rate-induced credit risk for banks, the CNB adopted a recommendation for credit institutions to mitigate that risk. It is recommended that credit institutions offer clients the possibility of changing loan financing conditions so that consumers having loans with variable interest rates could protect themselves against interest rate risk.