This technical note reviews with thestatus access to finance for enterprises in Montenegro,identifies key bottlenecks, and provides recommendations onhow to address main challenges. In particular, the notefocuses on SME finance by assessing (i) bank SME lending,and (ii) current constraints facing further development anddeepening of the non-bank credit sector. The note developskey findings presented to the authorities during the FSAPmission and summarized in the aide-mémoire. The Montenegrinfinancial sector has yet to recover from the collapse of thereal estate bubble in 2008. The crisis has exposed importantweaknesses in the financial sector’s governance, oversightand infrastructure which had fueled years of unsustainablecredit growth leading up to the crisis. The resultingbalance sheet deleveraging and restructuring process hasreduced the banking sectors’ ability to finance thecorporate sector, which continues to suffer from sloweconomic growth and remaining weaknesses in the business environment.
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