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The aim of this paper is to evaluate the influence of trends in retail loan portfolio on the consumption and economic growth of Macedonia. The consumption of population is one of the components of GDP, and one of its drivers is the retail credit activity. On macroeconomic level, there is wide consensus among researchers that credit activity and quality of portfolio is driven by GDP movements, unemployment ratio and indebtedness of population. Also, vice verse the activities in retail segment influence on consumption and indirectly on GDP. So these two linkages enhance between and can result in negative spiral. Negative movements in GDP influence on the quality of portfolio and higher NPL ratio. And higher NPL ratio results in further decrease in credit activity and has additional negative impact on GDP. Because of that is important to determine the causes of credit activity in this segment. The retail portfolio in the last 4 years in Macedonian banking sector is growing continuously, opposite of other Balkan countries. That is why is important to analyze the past growth of retail portfolio and to determine possible weaknesses because of its future impact on GDP. One of the most important drivers that determine the future credit growth is the quality of retail credit portfolio in the moment. Another important aspect for the portfolio trend will be the interest rate environment. There is clear empirical evidence that low interest environment triggers greater credit activity and vice versa. Another important aspect of the credit qrowth, is the maturity of the retail credit portfolio as a way to decrease the monthly installments and to accumulate greater risk on longer term. Special focus of this paper will be the trend in retail loan portfolio after 2008, when the banking system of Macedonia felt the impact from financial crisis. The activities that were taken by the banking sector then can be some guidelines for future crisis. The retail credit growth will be analyzed by products in order better to understand bank strategies and reasons that contributed for such a growth. Also, the analyze of NPL ratio by product will give answer whether the quality of portfolio by products was one of the key drivers for credit activity.

The aim of this paper is to examine the impact of the accession of Macedonia in the EU on the banking system. EU enlargement is a complex process with enormous impact on the economy of the new member countries. The financial system of the new member country, and the banking system as part of it, faces the challenge of integration in the EU financial system. The best evidence of the EU accession impact on the banking system is the analysis of the basic characteristics of banking systems of the countries that have become members in the last 20 years. The future banking development in the new EU member countries will very likely follow some main patterns known from the old EU members. In a way, banks from candidate countries can see their own future by observing the current developments in the Western European banking. The process of restructuring in the banking system through consolidation which has led to increased concentration has been one of the main drivers of changes. The existence of this process in new EU countries will be examined together with the structure of the Macedonian banking system. It is important to examine whether significant efficiency improvements have been achieved in the banking systems of the new EU countries and if they are a result of the bigger market power or some other factor. Also, there have been changes in the funding sources of the banks from the new EU countries with a lot of potentials for alternative funding. The financial crises has made these potentials evaporate, but on the long-term horizon, those opportunities will appear again. The low level of financial intermediation in new EU countries leaves space for increasing the range of financial services and their scope.

The aim of this paper is to examine the impact on the banking system from the accession of Macedonia in the EU. EU enlargement is a complex process with enormous impact on the economy of the new member countries. The financial system of the new member country, and the banking system as a part of it, faces with the challenge of integration in the EU financial system. The best evidence of the EU accession impact on the banking system is the analysis of the basic characteristics of banking systems on the countries that became members in the last 20 years. The future banking development in new EU member countries will very likely follow some main patterns known from the old EU members. In a way banks from candidate countries can see their own future by observing the current developments in Western European banking. The process of restructuring in the banking system through consolidation which lead to increased concentration was one of the main drivers of changes. The existence of this process in new EU countries will be examined together with the structure of Macedonian banking system. It is important to examine whether significant efficiency improvements were achieved in the banking systems of the new EU countries and are they result from the bigger market power or some other factor. Also, there were changes in the funding sources of the banks from the new EU countries with a lot of potentials for alternative funding possibilities. The financial crises made these potentials to evaporate, but on long term horizon, those opportunities will appear again. The low level of financial intermediation in new EU countries leaves space for increasing the range of financial services and their scope. Associated with the previous, a further enlarge of the market share on non-bank financial intermediaries in new EU members can be expected.