Macedonia has a sound financial system that is comprised of:
Banks and Saving Houses
The banking system is based on the Banking Law and the National Bank Law.
The Banking Law (Official Gazette of Republic of Macedonia, No. 67/2007) introduces liberalization regarding the bank foundation and work. Banks in Republic of Macedonia are established as joint stock companies with head offices in Republic of Macedonia, with initial capital of €5m in Denar equivalent.
Foreign bank may, through its branch in the Republic of Macedonia, perform the financial activities listed under article 7 of the Banking Law, authorized to perform in the country of its head office. The foreign bank branch shall hold monetary assets in the amount of at least €2m in Denar equivalent. The National Bank of Republic of Macedonia is the only authorized institution for bank licensing and bank supervision.
The Law on Leasing (Official Gazette of the Republic of Macedonia, Nos. 4/2002, 49/2003, 13/2006 and 81/2008) regulates the financial leasing. The Ministry of Finance is authorized institution for issuing and revoking licenses for performing financial leasing, as well as for supervision of the Lessors of financial leasing.
Leasing companies are established according to the Company Law and around 90% of the capital is owned by foreign investors.
Insurance companies perform their activities in accordance with the Insurance Supervision Law – consolidated text (Official Gazette of the Republic of Macedonia No. 30/2012), Decision of the Constitutional Court of the Republic of Macedonia No. 202/2011 (Official Gazette of the Republic of Macedonia No. 45/2012), Decision of the Constitutional Court of the Republic of Macedonia No. 130/2011 (Official Gazette of the Republic of Macedonia No. 60/2012), Decision of the Constitutional Court of Republic of Macedonia No. 122/2011 (Official Gazette of the Republic of Macedonia No. 64/2012) and the Compulsory Insurance in Traffic Law (Official Gazette of the Republic of Macedonia No. 88/2005, 70/2006, 81/2008, 47/2011 and 135/2011). These laws set the legal framework of establishment and performing life and non – life insurance and reinsurance operations, insurance intermediation (insurance brokerage companies and insurance agencies), insurance supervision and winding – up procedures of insurance and reinsurance undertakings established on the territory of the Republic of Macedonia.
The provisions of these laws shall also apply to insurance undertakings which have their principal offices on the territory of a foreign country while concluding insurance contracts or otherwise promoting their services in Macedonia, after the expiry of the transitional period determined by the law.
Both domestic and foreign legal entities and/or natural persons may incorporate an insurance undertaking in the legal form of a joint stock company. One insurance undertaking is not allowed to perform composite insurance operations. The share capital of an insurance undertaking must be at a level not lower than the Guarantee fund. The Guarantee fund shall at all times be higher than one third of the required level of solvency margin, and not lower than €2m if the insurance undertaking performs insurance operations in non-life insurance classes other than compulsory insurance in traffic, and €3m if the insurance undertaking performs insurance operations in compulsory insurance in traffic, or life assurance. A reinsurance undertaking shall possess at least €4.5m shareholders capital to perform the active reinsurance operations.
The Insurance Supervision Agency, an autonomous and independent regulatory body, performs insurance supervision through established processes of licensing, on-site and off-site insurance supervision and issuing measures of supervision, with the purpose of safeguarding the interests of insurance policyholders and promoting sound and competitive insurance market. The Insurance Supervision Agency informs the public about the developments on the insurance market through its website (www.aso.mk).
As of December 31th, 2012 there are 15 insurance undertakings (4 life, 11 non – life), 21 insurance brokerage companies and 9 insurance agencies.