Banking - Bosnia and Herzegovina

Bosnia and Herzegovina

In 2024, it is projected that the Net Interest Income in the Banking market of Bosnia and Herzegovina will reach US$532.70m.
Traditional Banks are expected to dominate the market with a projected market volume of US$480.30m in 2024.
The Net Interest Income is anticipated to exhibit an annual growth rate (CAGR 2024-2029) of 7.92%, resulting in a market volume of US$779.70m by 2029.
In comparison to other countries globally, China is expected to generate the highest Net Interest Income with US$4,332.0bn in 2024.
Bosnia and Herzegovina's banking market is experiencing a shift towards digital services to cater to the growing tech-savvy population.

Key regions: United States, China, Japan, Brazil, United Kingdom

Definition:

The Banking market refers to the financial services sector providing financial products and services to individuals and businesses. Retail banking focuses on offering financial services to individual consumers, such as personal loans, savings and checking accounts, credit cards, and mortgages. Commercial banking, on the other hand, provides financial services to small and large businesses, including loans, lines of credit, and other financial products designed specifically for businesses.

Structure:

The market consists of two segments:
- The Traditional Banking market refers to the financial services sector that provides a range of financial products and services to individuals and businesses through store-based branches and other traditional channels.
- The Digital Banking market refers to the emerging market for digital-only banks that offer financial services through online and mobile platforms.

The market data comprises Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Additional information:

The Banking market is highly competitive and characterized by the presence of large global players as well as regional and local banks. Banks are continually seeking ways to improve their offerings and remain competitive by leveraging technology and offering innovative financial products and services. Additionally, changes in regulations and the growing trend toward digitalization are shaping the Retail & Commercial banking market, creating opportunities for new entrants, and forcing existing players to adapt.
Key players in this market are companies such as the Industrial and Commercial Bank of China Ltd., JPMorgan Chase & Co., and HSBC Holdings.

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Analyst Opinion

The Banking market in Bosnia and Herzegovina has been experiencing notable developments in recent years.

Customer preferences: Customers in Bosnia and Herzegovina are increasingly seeking digital banking solutions, driving the demand for online and mobile banking services. Convenience, accessibility, and efficiency are key factors influencing customer preferences in the banking sector. Additionally, personalized services and competitive interest rates are becoming more important to customers in this market.

Trends in the market: One of the prominent trends in the banking market in Bosnia and Herzegovina is the growing competition among banks to innovate and offer advanced digital banking services. This trend is fueled by the rising adoption of technology among the population and the need for seamless banking experiences. Moreover, there is a noticeable shift towards sustainable and socially responsible banking practices in the country, reflecting global trends in the financial industry.

Local special circumstances: Bosnia and Herzegovina's banking sector is characterized by a relatively high number of banks operating in the market, leading to intense competition. This dynamic environment has prompted banks to differentiate themselves through innovative products and services tailored to meet the evolving needs of customers. Furthermore, the country's complex regulatory framework and diverse customer base present unique challenges and opportunities for banks operating in Bosnia and Herzegovina.

Underlying macroeconomic factors: The economic stability and growth prospects of Bosnia and Herzegovina play a significant role in shaping the banking market in the country. Macroeconomic factors such as GDP growth, inflation rates, and unemployment levels influence the overall performance of banks and their ability to attract and retain customers. Additionally, government policies and regulations impact the banking sector's operations and growth potential in Bosnia and Herzegovina.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on Net Interest Income, Bank Account Penetration rate, the value of Deposits, the number of depositors, the value of Loans, the number of borrowers, Credit Card Interest Income, the number of ATMs as well as the number of Bank Branches.

Modeling approach / Market size:

Market sizes are determined by a combined Top-Down and Bottom-Up approach, based on a specific rationale for each market segment. As a basis for evaluating markets, we use data provided by the IMF, World Bank and the annual reports of the top 1000 Banks by asset size. Next we use relevant key market indicators and data from country-specific associations such as GDP, deposit interest rates, lending interest rates or bank account penetration rates. This data helps us to estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the particular market. For example, the S-curve function and exponential trend smoothing are well suited to forecast financial services for digital as well as traditional products and services.

Additional Notes:

The market is updated twice per year in case market dynamics change.