Rohatinski informed the new members of the 14-member council of the guidelines in the work of the central bank and instruments of monetary policy with which it was carrying out its tasks.
According to a press release issued by the HNB, the governor pointed out factors which hampered the central bank's efforts to operate according to simple rules: a high rate of Euroisation, the fact that almost all local banks are owned by foreigners, an influx of foreign capital motivated by high yields in Croatia with the high offer of foreign currencies on a small and shallow marketand an aggressive offer of loans and their high growth.
According to Rohatinski, all of this has triggered taking loans abroad, although a rise in the foreign debt has recently slowed down and the debt reached 27.3 billion euros at the end of June. In addition, the national currency kuna is constantly exposed to steady appreciation pressure and the HNB has been dealing with that by interventions on the foreign market. As a result, the HNB has increased its foreign currency holdings by 580 million euros so far this year.
In such a climate, the central bank is forced to find solutions so as to keep unbalances within acceptable frameworks, with a satisfactory stability of prices and exchange rates, and support the overall economic policy and sustainable growth.
The 14-member HNB Council consists of Governor Rohatinski, his deputy Boris Vujcic, four assistant governors and eight external members, i.e. independent experts. These eight external members - Boris Cota, Vlado Leko, Branimir Lokin, Zeljko Lovrincevic, Silvije Orsag, Jure Simovic, Sandra Svaljek and Mladen Vedris - were appointed to the council by the Croatian parliament on 13 July.