The European Bank for Reconstruction and Development (EBRD) will provide a €30 million standby credit line to Bosnia's Deposit Insurance Agency of (DIA) to ensure that citizens and businesses are protected against potential vulnerabilities in the financial sector during the coronavirus pandemic, EBRD said on Tuesday.

The new facility will safeguard the financial sector and strengthen the deposit insurance system in Bosnia and Herzegovina by providing funds to help ensure the protection of retail and corporate banking clients. The facility is in line with recommendations by the International Monetary Fund (IMF) and important for the country’s progress towards EU approximation.

The new facility will replace an existing €50 million standby credit line signed by the EBRD in 2010 with the DIA, an independent public institution established to provide insurance to the owners of deposits held with local banks.

The EBRD’s standby facility will offer an important confidence boost to the financial sector, thus strengthening the banking system in Bosnia and Herzegovina. The country’s financial safety net is key to withstanding the economic shocks caused by the coronavirus pandemic.

“Supporting the stability of the financial sector in our countries of operations is one of the EBRD’s core priorities in the current challenging environment. We are delighted to renew our standby credit line with the Deposit Insurance Agency of Bosnia and Herzegovina as the new facility will contribute to the protection of depositors and help maintain confidence in the country’s banking sector,” said Manuela Naessl, EBRD Head of Bosnia and Herzegovina.

Since it began operations in Bosnia and Herzegovina in 1996, the EBRD has invested more than €2.7 billion in 183 projects in the country.