Albanian central bankers take 50% pay cut in virus response

Top executives of Albania's central bank took a 50% pay cut on Thursday in solidarity with citizens suffering amid the coronavirus pandemic, coming into line with reductions already accepted by government ministers and lawmakers.

The central bank's supervisory board chaired by Governor Gent Sejko said it would halve its own pay and those of the central bank's managers until the coronavirus outbreak that has killed 22 Albanians so far had been brought under control. The central bank also said on Thursday it had told banks to suspend handing out dividends until the end of June and scrapped its own and the banks' online fees to make sure they could absorb possible losses and continue lending.

Prime Minister Edi Rama's Socialist government has already halved its own pay, as have its lawmakers. Parliament on Thursday asked independent supervisory institutions to follow suit. The central bank said its dividend request aimed to bolster the banking sector.

"This measure by the supervisory authority aims to build up support for the banks, mainly by boosting their capacity to absorb potential losses and back lending for clients and businesses during this period," it said in a statement. It also asked banks to scrap commissions on lending transfers in non-paper form from Friday, April 10, so clients could pay online and to minimize crowds at their branches.

"More to the point, this decision seeks to make more attractive the use of home banking services by eliminating the costs of this service," the statement added. To compensate for the banks' lost income, the central bank said it would also scrap fees for its own payment systems.

There has been no reaction so far from the banks, who have also been asked to postpone loan payments until the end of May. One banking source told Reuters he felt online fee scrapping was OK and he personally saw the dividend suspension as a positive move. Since March 15 Albania has been enforcing a curfew on weekdays from 1 p.m. to 5 a.m. and closed most businesses except for the garments sector, call centers, construction and banks.

Albania has passed a package of $370 million to cushion the health sector, business, the less privileged, and those who lost jobs. It also includes a guarantee of 11 billion leke ($96 million) to companies to help them borrow and pay employees. Payments were made to some applicants on Thursday though some were rejected, leading to opposition complaints that the process was selective.

($1 = 115.5000 leke)