Banking System on the Albanian Path to European Union Integration
Banking System on the Albanian Path to European Union Integration

Summary/Abstract: Purpose: This article aims to assess the contribution of the Albanian banking system to the European Union integration process by analysing its progress and challenges in alignment with accession criteria and compliance with EU acquis. Methodology: The research spans 12 years (2011-2022) of monitoring by the European Commission. The methodology involves a thorough review and content analysis of annual EU integration progress reports for Albania, uncovering banking system-related criteria, requirements and recommendations enhanced by a thematic analysis identifying recurring themes and report patterns over the years. Findings: The analyses confirm the hypothesis that the Albanian banking system has made significant progress in aligning with EU accession criteria, as evidenced by positive evaluations of the European Commission, mainly in macroeconomic and financial stability, but still ample room for lending and financial inclusion improvement. The progress reports over the years have consistently ascertained the positive impact of the monetary and macroprudential policy, while progress in non-performing loans (NPLs) is acknowledged, ongoing concerns persist regarding the extensive use of the Euro in the economy Value: This paper holds multifaceted value as a resource for policymakers, researchers, and those engaged in EU integration. It comprehensively assesses the Albanian banking system’s progress and offers practical recommendations, with a particular emphasis on improving financial education as a key factor on the demand side. Using a long-term, data-driven approach, it uniquely examines the system’s contributions and challenges in meeting EU standards, making it essential for Albania’s European Union integration efforts.

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