As of the end of July, the Central Bank of Montenegro (CBCG) reported that banks’ mandatory reserves totaled €287.3 million.
Of this amount, 70.99% was held in domestic accounts, while 29.01% was kept in CBCG accounts abroad.
In June, the average total deposit base for banks was €5.27 billion. Within this base, 84.04% were demand deposits, and 15.96% were term deposits.
Banks allocate mandatory reserves according to CBCG regulations. The reserve requirement includes a rate of 5.5% for demand deposits and term deposits up to one year, and 4.5% for term deposits longer than one year. For term deposits with an option for early withdrawal within one year, the rate is also 5.5%.
Since January 2018, the reserve base has included both term and demand deposits, excluding those of central banks.
CBCG compensates banks with a monthly fee on 50% of the allocated mandatory reserves, calculated at the €STR (Euro Short-Term Rate) minus ten basis points annually, with a minimum rate of zero.
Additionally, banks can use up to 50% of the mandatory reserves interest-free for daily liquidity, provided the borrowed amount is returned on the same day.
