Central Bank of Bosnia and Herzegovina
Bosnia and Herzegovina's central bank, responsible for monetary stability under a statutory currency board arrangement.
Last updated August 22, 2026
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Overview
The Central Bank of Bosnia and Herzegovina (CBBH) is the country's central monetary institution, headquartered in Sarajevo. It was created by legislation adopted by the Parliamentary Assembly of Bosnia and Herzegovina on 20 June 1997 and began operating on 11 August of that year, following the Dayton peace settlement and the reorganization of the country's fragmented wartime monetary institutions. Its establishment consolidated the functions of the former National Bank of Bosnia and Herzegovina and the National Bank of the Republika Srpska. The CBBH operates under a currency board arrangement rather than a conventional discretionary central-bank model. It issues the convertible mark, Bosnia and Herzegovina's domestic currency, only against full coverage by freely convertible foreign-exchange reserves. The convertible mark is fixed to the euro at a statutory rate of 1 BAM to 0.51129 EUR. This framework places the primary emphasis of the institution on preserving monetary and exchange-rate stability, maintaining confidence in the currency, and ensuring that the monetary base is adequately backed by foreign assets. Within the authority granted by the Law on the Central Bank of Bosnia and Herzegovina, the institution defines and controls the implementation of monetary policy, supports payment and settlement systems, and performs central-bank functions for the entire country. It also coordinates activities involving the banking agencies of Bosnia and Herzegovina's two entities. Those agencies are responsible for bank licensing and supervision, while the CBBH provides the monetary and payments infrastructure within which the banking system operates. The institution is governed by a five-member Governing Board. Members are appointed by the Presidency of Bosnia and Herzegovina for six-year terms, and the board appoints one of its members as governor. Operational management consists of the governor and three vice governors. The CBBH's organizational network includes its head office, the Main Unit Sarajevo, the Main Bank of Republika Srpska CBBH in Banja Luka, the Main Unit Mostar, the CBBH Branch in Brčko, and the Main Bank of Republika Srpska CBBH Branch in Pale. The CBBH's headquarters occupy a historically significant building in central Sarajevo. Completed in 1931 for the Sarajevo branch of the State Mortgage Bank of Yugoslavia, the building was designed by architect Milan Zloković. Its façade includes reliefs by Vladimir Pavlovich Zagorodnjuk and monumental bronze figures at the main entrance. Today, the building serves as the institutional base of a central bank whose mandate is closely linked to post-war state-building, monetary credibility, and the functioning of a unified national payments system.
History
The institutional origins of Bosnia and Herzegovina's central banking system extend to the National Bank of Bosnia and Herzegovina, established in 1971 within Yugoslavia's system of national banks. That system replaced the National Bank of Yugoslavia as the collective monetary authority for the federation. The National Bank of Bosnia and Herzegovina operated as the republic-level monetary institution until Bosnia and Herzegovina declared independence in March 1992. The country's independence and the subsequent Bosnian War disrupted the pre-existing monetary structure. The National Bank of Bosnia and Herzegovina continued in a national role, but the conflict produced separate monetary arrangements in different parts of the country. The Republika Srpska established its own National Bank, while the Croatian Republic of Herzeg-Bosnia operated a monetary system associated with its finance ministry. This fragmentation reflected the political and territorial division created by the war and meant that a unified post-war monetary authority had to be built as part of the broader peace settlement. The Dayton Agreement ended the war and established the constitutional framework within which Bosnia and Herzegovina's state institutions would operate. In that setting, the Parliamentary Assembly adopted the Law on the Central Bank of Bosnia and Herzegovina on 20 June 1997. The law created a single central bank and assigned it responsibility for monetary stability, currency issuance, and payment-system functions across the country. The institution began operations on 11 August 1997 and incorporated the relevant operations of the former National Bank of Bosnia and Herzegovina and the National Bank of the Republika Srpska. The former national bank was subsequently liquidated. The CBBH was designed around a currency board arrangement. Under this model, the convertible mark is issued with full backing in freely convertible foreign-exchange funds and is maintained at a fixed exchange rate of 1 BAM to 0.51129 EUR. The arrangement limits discretionary monetary expansion and makes reserve coverage and exchange-rate credibility central to the bank's work. Rather than setting an independent floating exchange rate or using broad interest-rate discretion as its main policy instrument, the CBBH operates within the statutory constraints of the currency board while maintaining the monetary and payments infrastructure required by the domestic economy. The bank's responsibilities include defining and controlling implementation of monetary policy within its legal powers, issuing the domestic currency, supporting payment and settlement systems, and coordinating activities involving the banking agencies of Bosnia and Herzegovina's two entities. The entity banking agencies handle bank licensing and supervision, so the CBBH's role is complementary: it supplies the national monetary framework and coordinates institutional activities relevant to the financial system. Governance is vested in a five-member Governing Board. The Presidency of Bosnia and Herzegovina appoints board members for six-year mandates. The board is responsible for monetary policy, institutional organization, and strategy, and selects one of its members to serve as governor. Day-to-day administration is carried out by the governor and three vice governors, with each vice governor responsible for a sector of the institution's operations. The CBBH's territorial organization reflects the country's administrative structure. In addition to its head office, it operates the Main Unit Sarajevo, the Main Bank of Republika Srpska CBBH in Banja Luka, the Main Unit Mostar, the CBBH Branch in Brčko, and the Main Bank of Republika Srpska CBBH Branch in Pale. Its Sarajevo headquarters also connect the modern institution with the city's earlier financial history. The building was completed in 1931 for the Sarajevo branch of the State Mortgage Bank of Yugoslavia. Architect Milan Zloković designed it, while Vladimir Pavlovich Zagorodnjuk produced eight façade reliefs and two monumental bronze figures at the main entrance. The building now houses the central institution responsible for monetary stability in the post-war state.
- 2024
Jasmina Selimović becomes governor
[1]Jasmina Selimović succeeded Senad Softić as governor on 3 January.
- 2015
Senad Softić becomes governor
[1]Senad Softić succeeded Kemal Kozarić as governor on 11 August.
- 2005
Kemal Kozarić becomes governor
[1]Kemal Kozarić succeeded Peter Nicholl as governor.
- 1997
CBBH law adopted
[1]The Parliamentary Assembly adopted the Law on the Central Bank of Bosnia and Herzegovina on 20 June, establishing the institution within the post-Dayton state framework.
- 1997
Central bank begins operations
[1]The CBBH commenced operations on 11 August and consolidated operations associated with the former National Bank of Bosnia and Herzegovina and the National Bank of the Republika Srpska.
- 1992
Bosnia and Herzegovina becomes independent
[1]Following independence in March, the former republic-level bank became the monetary institution of the newly independent country, although the war soon fragmented the monetary system.
- 1971
National Bank of Bosnia and Herzegovina established
[1]The National Bank of Bosnia and Herzegovina was created within Yugoslavia's system of republic-level national banks.
Products and positioning
The statutory monetary authority of Bosnia and Herzegovina, focused on exchange-rate and monetary stability through a currency board system.
Currency · 1997
Convertible mark issuance
The CBBH issues Bosnia and Herzegovina's convertible mark under the currency board arrangement. Currency issuance is linked to full coverage by freely convertible foreign-exchange reserves, and the mark is maintained at the statutory fixed rate of 1 BAM to 0.51129 EUR.
Monetary framework · 1997
Currency board arrangement
The currency board is the CBBH's defining monetary framework. It prioritizes reserve backing and exchange-rate stability and constrains discretionary monetary expansion. The arrangement provides the institutional basis for maintaining confidence in the convertible mark.
Financial infrastructure · 1997
Payment and settlement systems
The CBBH supports and maintains payment and settlement systems used within Bosnia and Herzegovina. These functions provide infrastructure for the transfer and settlement of funds across the country's financial system.
Information services · 1997
Monetary and financial statistics
As the national central bank, the CBBH produces and maintains monetary, banking, and financial information within the scope of its mandate. These data support monitoring of monetary stability and the financial system.
Brand decisions
1997
Adoption of the currency board frameworkStrategyBackground
The post-Dayton monetary system required a unified institution capable of supporting monetary stability in a country emerging from war and divided monetary administration.
Action taken
The CBBH was established with a statutory currency board arrangement under which domestic currency issuance is fully backed by freely convertible foreign-exchange reserves and the convertible mark is fixed to the euro.
Aftermath
The framework became the central operating principle of Bosnia and Herzegovina's monetary system and defined the CBBH's role as a stability-focused central bank with limited discretionary monetary-policy flexibility.
1997
Consolidation of wartime monetary institutionsStrategyBackground
The Bosnian War had produced separate monetary institutions and arrangements in different parts of the country.
Action taken
The new central bank incorporated the relevant operations of the former National Bank of Bosnia and Herzegovina and the National Bank of the Republika Srpska, while the former national bank was subsequently liquidated.
Aftermath
The consolidation created a single central monetary authority for Bosnia and Herzegovina.
Recent events
- 2024
Jasmina Selimović becomes governor[1]
Leadership change
Jasmina Selimović succeeded Senad Softić as governor of the Central Bank of Bosnia and Herzegovina on 3 January 2024.
- 1997
Central Bank of Bosnia and Herzegovina begins operations[1]
Other
The newly established central bank started operations after legislation adopted in June 1997 created a unified monetary institution for Bosnia and Herzegovina.
Sources2 sources
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