Albanians have no trust in their domestic currency. For this reason, they keep their savings in the euro currency. This was stated by the Albanian Bank, which is aimed at reducing the use of the euro in the economy in order to increase the value of the official currency.
The Euro is a quasi-legitimate payment instrument in many large value transactions, such as real estate (house and home) machines, up to retail outlets, and more than half of the loan and deposit are in currency foreign.
In 2011, the Bank of Albania, worrying that Albania was rapidly euro sizing, signaled banks to favor the use of domestic currency in the economy and the Albanian banking system against the use of foreign currency (the bank removed the remuneration of the required reserve in foreign currency, encouraging commercial banks to reduce fund-raising costs). At that time, foreign currency credit accounted for 65% of the total, while the share of deposits was 48.3%.
Where 6 years have passed, banks find it easier to curb foreign currency lending. By the end of February 2017, the share of foreign currency credit declined to 52.4%, or nearly 13 percentage points. But banks could not control the supply side, that of foreign currency savings. Although interest rates on euro deposits are close to zero, and the common currency has been substantially depreciated in recent years, this does not prevent Albanians from keeping savings in Euros. During 2016, foreign currency savings went through for the first time in ALL, to reach 52.4% of the total at the end of February 2017. /Monitor
