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Greek banks under pressure despite reassuring BoG statement

Speaking for the first time since a bank stock sell-off started on the Athens Exchange last week, Bank of Greece Governor Yannis Stournaras said Wednesday that the recent performance of the lenders in the stock market is not related to the soundness of the Greek banking system. Stournaras put the slump down to “purely external factors such as rises in interest rates internationally, and particularly in Greece’s neighbouring countries.”

Stournaras’ intervention managed to restore calm in afternoon trading with the general index turning positive during Wednesday’s session. However, the early gains vanished, with the general index closing at 625.83 points, 0.05 percent down from Tuesday’s 626.17 points. The large-cap index contracted 0.29 percent to 1,639.40 points while the banks index fell 1.95 percent.

The central banker’s statement came after the European Central Bank lowered the ceiling on emergency liquidity assistance (ELA) for Greek banks by 200 million euros to 5 billion euros. The move reflected improved liquidity conditions, taking into account private sector deposit flows and banks’ access to financial markets, the Bank of Greece said.

Stournaras had come under fire earlier this week from the government spokesman and other senior members of the Tsipras administration for allegedly failing to issue a statement defending the state of the banking system as bank stocks were in free fall.

Sources close to Stournaras who spoke to Eleftheros Typos newspaper this week clarified that the Governor traditionally never comments on the fluctuation of stocks. Moreover, Stournaras works closely with the Ministry of Finance and senior government officials who oversee the banking system.

Meanwhile, in a report published on Wednesday, Moody’s ratings agency said the poor quality of assets held by Greek banks makes them vulnerable to external shocks and risks. Non-performing exposures (NPEs) are consuming resources and reducing banks’ profits and funds, Moody’s noted…. / ΙΒΝΑ

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The frozen conflict between Serbia and Kosovo poses a “stability risk”

Washington appeals on both Belgrade and Pristina to use a "historic opportunity" and reach an agreement which would be a win-win solution, said Matthew Palmer, deputy assistant of the American secretary of state. Palmer spoke during the Belgrade Security Forum today. He has also met President Aleksandar Vucic.

"If somebody wins, and the other side loses, then nobody wins", Palmer said at the panel "Building on momentum in the Balkans".

The American official said that his country does not "push" towards any specific result of the dialogue between Belgrade and Pristina. "We do encourage both sides to find way forward as well as durable and sustainable solution", Palmer said.

The solution must be acceptable for the both sides, he went on. Washington is ready to "hear and assist", Palmer said, adding, however, that he cannot talk about details, especially on a possible swap of the territories.

Palmer explained that no plan of the territory swap has been presented so far. Although the United States do understand concerns that the territory swap could provoke a crisis in the other parts of the region, an unresolved dispute or "frozen conflict" could also "pose a risk for the regional stability", Palmer said.

He underlined that Serbia and Kosovo have a "European future" and that they both need assistance in that regard.

Palmer also referred to the former Yugoslav Republic of Macedonia and Bosnia and Herzegovina. If Skopje wants to join both European Union and NATO, then the Prespa Agreement has no alternative, he emphasised. Palmer appealed on political leaders in Skopje to overcome parties' divisions for the sake of a "European future".

Referring to Bosnia, Palmer said that the "biggest problem" of that country are its "corrupt politicians who use a nationalistic rhetoric to create divisions". He added that the United States are "committed" to Bosnia's territorial integrity.

The "United States want to help everybody. Stronger Western Balkans means a stronger Europe and a stronger Trans-Atlantic partnership", the American diplomat concluded…. / IBNA

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BiH against Kosovo’s membership in Interpol

Bosnia and Herzegovina will not support the membership of Kosovo in Interpol, the BiH Ministry of Foreign Affairs announced.

The Ministry explained this decision based on the fact that BiH has not recognised Kosovo as independent state yet and, accordingly, cannot support its membership in any of the international organisations.

In its press release the Ministry emphasised that it did not recognise the "the self-proclaimed independence of so-called Kosovo and, and in accordance with that, does not support the applications for its membership in the international and regional organisations, therefore it will not support a possible candidacy for the membership of so-called Kosovo in Interpol."

The exception, according to the ministry's statement is the participation of this region that declared independence from Serbia in 2008, in certain international and regional initiatives, which was previously harmonised with Serbia.

"BiH Ministry of Foreign Affairs has delivered to all competent institutions of Bosnia and Herzegovina a detailed explanation of the said foreign-policy goal, which is the ground for Bosnia and Herzegovina's acting at international forums", said the ministry.

Kosovo's recognition is a political issue in Bosnia and Herzegovina, where a decision to acknowledge the independence of this country requires the consent of three constituent ethnic groups and two semi-autonomous entities. Republika Srpska politicians are following the stance of Serbia on this matter. It means that BiH will not recognise Kosovo until Serbia does it.

Pristina issue triggered the very first sparks between elected members of BiH Presidency, Milorad Dodik and Željko Komšić, because Komšić recently said that, as far as he is concerned, Kosovo is an independent state. Dodik reacted with a statement, saying that there is no way to consent to BiH recognising this "Serbian region". Also, politicians in Serbia, the country's president Aleksandar Vučić and the Minister of Foreign Affairs, Ivica Dačić, underlined that the Komšić statement is not in accordance with the good relations between two states.

"BiH did not recognise Kosovo, and if members of the Presidency do not respect the territorial integrity of Serbia, they should know that they are breaking friendly relations, as well as provoking our reciprocal reaction. Instead, it's better to turn to co-operation and a common future", Dačić note…. / ΙΒΝΑ

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Inauguration of the SOCAR refinery in Izmir

The state-owned company of Azerbaijan, SOCAR, has put its own stamp in the field of hydrocarbon management in Turkey, inaugurating its first refinery in the eastern city of Izmir.

Turkish president, Recep Tayyip Erdoğan, and his Azeri counterpart, İlham Aliyev were at today's inauguration ceremony of the STAR refinery.

It took seven to build the refinery -its construction started in 2011- and is expected to reduce Turkey's annual current account deficit by at least $ 1.5 billion.

It is one of the biggest investments in Turkey's history, with a budget of $ 6.3 billion, and one of the largest oil and gas facilities in Europe, the Middle East and Africa. The STAR refinery started its operation by receiving the first cargo ship carrying 80,000 tons of crude from Azerbaijan in early August.

SOCAR's chief executive for Turkey, Zaur Gahramanov, then confirmed the arrival of the first freight and said production would begin at the end of October.

With this refinery Turkey's need to import jet fuels, which will account for 7% of STAR's total output, is expected to be completely eliminate while at the same time it is anticipated to reduce its LPG imports from 79% 70%.

With an annual production capacity of 10 million tons of crude, the refinery will also produce 1.6 million tons of naphtha and 1.6 million tons of jet fuel annually…. / IBNA

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Lending in Albania drops: Central Bank

The Report on Lending for the third quarter of the year published by the Bank of Albania suggests a decrease in lending for businesses operating in the country. Meanwhile, the report adds that lending for individuals grew and this includes consumer loans and mortgage loans.

On the other hand, in the last quarter of the year, banks are expecting to apply similar standards to the third quarter regarding business loans, while for individuals, they’re expected to soften them even further.

According to banks, demands for loans are expected to be higher in the third quarter for both businesses and individuals alike. /ibna/

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FDI in Bulgaria in January-August 2018 was 230.5M euro

Foreign direct investment in Bulgaria in the first eight months of the year stood at 230.5 million euro, the equivalent of 0.4 per cent of the gross domestic product, statistics from the Bulgarian National Bank (BNB) showed on October 19. In the same period of 2017, FDI was 812 million euro, but the original amount reported by BNB last year was 516.4 million euro, which was revised upward later.Investment in equity, including in the real estate sector, recorded an outflow of 27.1 million euro (compared to an inflow of 174.4 million euro in January-August 2017) and re-invested earnings accounted for an outflow of 18 million euro (less than the outflow of 33.6 million euro a year earlier), according to preliminary data.Receipts from real estate investments by foreign companies totalled 4.6 million euro, compared to 13.3 million euro during the same period of 2017.The central bank data showed 275.6 million euro in investment inflows as debt instruments, recorded as the change in the net liabilities of Bulgarian companies towards their foreign investor owners, compared to 671.2 million euro in the first eight months of 2017. Such financial flows include financial loans, suppliers’ credits and debt securities, BNB said.By country, the largest direct investment in Bulgaria in January-August 2018 came from the Netherlands (264.9 million euro), Russia (158.5 million euro) and Germany (79.7 million euro). Notable net outflows were recorded towards Italy (-164.4 million euro) and Ireland (-112.1 million euro).According to preliminary figures, Bulgarian investment abroad increased by 287 million euro in the first eight months of 2018, compared to 219.2 million euro in the same period of last year, BNB said… / ΙΒΝΑ

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