ZSP Advokati Partner Jelisaveta Stanisic talks about banking and finance in 2025 in Serbia.
CEELM: What is in the pipeline in terms of legislation that you believe will have the most impact on the banking/finance sector in Serbia?
Stanisic: There are two key legislative developments in Serbia’s banking and finance sector. First, lawmakers are working on a draft law on real estate investment trusts (REIT). When it enters into force, the legislation will represent a significant upcoming regulatory change for Serbia’s financial markets.
This framework will establish the first regulated vehicle for capital market-based real estate investment in Serbia. The legislation aims to transform traditional property investment practices by providing a market-based alternative to direct real estate ownership.
Secondly, the forming of the working committee for updating FX legislation hints at potential updates and modernization of FX regulations. However, given the early stages, the scope and impact of these planned changes are yet to be seen.
CEELM: Of the above, which ones are you/your clients most excited about and why?
Stanisic: We expect that the REIT legislation will generate substantial interest among investors. Serbia’s culture has historically favored real estate investments, but this has been limited to direct property acquisitions.
The new framework promises to enhance market liquidity through securities trading while offering tax incentives and broader access to diverse real estate portfolios. Despite the underdeveloped state of local capital markets, regulators anticipate that the combination of liquidity benefits and tax advantages will attract significant investor interest.
CEELM: On the flip side, which ones are you/your clients dreading the most and why?
Stanisic: In my view, market participants have not expressed significant concerns regarding upcoming legislative changes, suggesting the reforms are viewed as market-enhancing rather than restrictive.
CEELM: What trends do you expect to shape the banking sector in Serbia in 2025?
Stanisic: Several key developments are expected to shape the sector. We expect to see an expansion of capital markets debt through anticipated dinar-denominated bond issuances.
There will also be a potential entrance of leading Serbian companies into international bond markets – a trend already kickstarted in the second half of 2024 by Telekom Serbia’s Eurobond issuance. Additionally, we expect intensified competition among banks in the prime borrower segment.
CEELM: What is the biggest challenge for the banking sector in Serbia at the moment, in your view, and what is the likelihood you’ll see it overcome in 2025?
Stanisic: I believe that the primary concern centers on the potential economic impact of the current political climate. There are concerns about possible economic deceleration, though the banking sector remains optimistic about maintaining stability.
The combination of new investment vehicles, particularly REITs, and evolving market dynamics suggests a period of significant development for Serbia’s financial sector.
While challenges exist, the institutional framework appears sufficiently robust to support continued market development.
This article was originally published in Issue 12.1 of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.
