There are 62 commercial banks operating in Croatia at present. The first foreign bank, namely, Raiffeisen Bank Austria d.d. Zagreb started operating in Croatia at the beginning of 1995, and was the first bank with 100% foreign capital. During 1997 a further six banks, which are 100% or partially owned by foreign banks, started operating in Croatia.



According to the Banks and Savings Banks Act foreign legal entities and natural persons may establish new banks or make investments in existing banks provided that the condition of reciprocity is met.

The minimum amount of capital required to establish a bank or a savings bank:

  • the domestic currency equivalent of 5,000,000 DM; banks established with this amount of capital can perform all banking transactions except money transfer and credit transactions with foreign countries
  • the domestic currency equivalent of 15,000,000 DM; banks established with this amount of capital can perform all banking transactions, including money transfers and credit transactions with foreign countries ("full authorisation")
  • the domestic currency equivalent of 2,000,000 DM; savings banks established with this amount of capital can perform transactions involving foreign means of payment.

Subsidiaries of foreign banks

A foreign bank may decide to establish a subsidiary for performing banking transactions, provided that the condition of reciprocity is met. Such a subsidiary does not have the status of a legal entity, and the bank is responsible for all the obligations stemming from the business activity of the subsidiary.

The minimum capital required to establish a subsidiary of a foreign bank is the domestic currency equivalent of 2,500,000 DM (guarantee capital). A subisidiary has "full authorisation".

Permission to operate is granted to the above-mentioned financial institutions by the Croatian National Bank.

Representative Offices of foreign banks

One or more foreign banks may, alone or with other banks, decide to establish a Representative Office in the Republic of Croatia, (provided that the condition of reciprocity is met), for the purpose of market research in banking and financing, or for the purpose of advertising, promotion and representation. A Representative Office does not have the status of a legal entity and is not allowed to engage in banking operations. The establisher guarantees for all the obligations of the Representative Office.

Permission to operate is granted to Representative Offices of foreign banks by the Croatian National Bank which keeps the Register of Representative Offices of Foreign Banks in the Republic of Croatia and issues permissions for their registration.


Foreign investors may also establish and invest in an insurance company; their contribution should amount to the domestic currency equivalent of 2,000,000 DM to 3,000,000 DM, dependant on the type of activities they wish to perform. Permission to operate is granted by the Directorate for the Supervision of Insurance Companies, which also supervises their business activities.


The Croatian Bank for Reconstruction and Development (HBOR) is the first investment bank founded by the State, and for which it guarantees its obligations.

The bank performs the following tasks:

  • credit financing for development projects and the reconstruction of the Croatian economy;
  • credit financing for the reconstruction and rebuilding of apartments, houses and infrastructure facilities;
  • credit financing for exports; and,
  • insurance of exports against non-commercial risks.


The Securities Act regulates the public offer of securities; activities of legal entities who are authorised to conduct business with securities; trading with securities; prohibitions and limitations regarding businesses with securities; and, the protection of investors.

According to the Securities Act the issuers will not issue securities in a material form. They must rather simply register them through electronic processing i.e. computers. A Central Depository Agency should conduct all the operations involved in the storing and transfer of dematerialised and immobilised securities. Before this Agency begins on a regular basis all such operations will be carried cut by the Croatian Payments Transfer Agency (ZAP).

Securities transactions are entered into a Court register and they can be performed by limited liability companies or joint-stock companies established with a minimum capital higher than the required capital for enterprises that are in another line of business.

Trading with securities that are issued through a public offer is conducted at the stock exchange or other forms of institutionalised public markets.

A stock exchange must be founded as a joint-stock company with at least 20 members. The equity capital has to be at least 1,000,000 HRK. Every stock exchange is obliged to include securities in at least two quotations, one of which (the highest one) is regarded as the official or regular quotation.

Institutionalised public markets are places which offer securities that are not officially listed. They are regulated by the same statutory provisions as the stock exchange, however, only the regulations referring to the listing of securities as official or regular do not apply.


The Investment Funds Act regulates the conditions for the establishment of investment funds and enterprises for the management of investment funds.

The Act stipulates the requirements for establishing open-end funds and closed-end funds.

In order to establish an investment fund, approval by the Securities Commission is needed for the public collection of capital and property assets by public sale, i.e. issuing of documents on the fund's shares or of shares which are to be invested in negotiable securities and/or real estate and deposits in financial institutions.

The establishment and operations of an enterprise for the management of a fund are subject to the provisions of the Company Act. The minimal required capital has to be at least 1,000,000 HRK and the enterprise has to employ members with the necessary expertise to manage it.

An enterprise for the management of a fund selects the depository bank for the investment fund. This activity may be performed by banks and savings institutions in Croatia. The enterprise and the depository bank have to act independently and in the best interest of their shareholders.


Foreign currency transactions with foreign countries are based on the Foreign Currency System, Foreign Currency Transactions, and Trade in Gold Act which states that foreign currency is freely available and that trade in foreign currency must be carried out through the foreign currency market.

In legal terms, a foreign person is a legal entity with headquarters abroad or a physical person with residence abroad.

Payments and credit transactions abroad are effected through authorised banks (banks authorised for foreign transactions) that are responsible for their own solvency regarding the payment to foreign countries.

Foreign legal entities may hold foreign currency accounts with authorised banks in convertible currencies, through which they can freely effect foreign currency transactions and payments abroad. Foreign legal entities may deposit foreign currency into their foreign currency accounts with authorised domestic banks.

External payments are made in domestic or foreign currency.

Profits gained from investments of capital in the Republic of Croatia, capital regained on disinvestment, and revenue from the sales of shares, may be transferred freely to foreign accounts abroad, provided all legal obligations in Croatia are settled.

Profits gained as a result of construction works in the Republic of Croatia carried out by foreign contractors may be transferred abroad freely.

Foreign entities may accept receivables in domestic currency in accounts with domestic banks authorised to conduct businesses abroad under the conditions established by the Government of the Republic of Croatia.

Such receivables in domestic currency can be used by foreign legal entities for transfer abroad, for payment in the Republic of Croatia, for loans to domestic legal entities in accordance with the Act, and for the transfer to another foreign legal entity's domestic account (in domestic currency).

Foreign currencies and securities in foreign currency nominations can be freely brought into Croatia.

Legal entities from Croatia have to collect the payment for exported goods abroad within 90 days of when the goods were exported or the service provided. This time limit can be prolonged once only, if approved by the National Bank of Croatia.

Domestic legal entities can also make a clearance, or claim their credits (collect their money) from abroad in foreign currency (cash), pay for the import of goods and services in advance, all in accordance with the Act. However, it is necessary to have special approval of the Croatian National Bank.

Payment and collection of payment for business with foreign countries can be done by the following usual instruments of payment:

  • documentary letter of credit (revocable and irrevo-cable, confirmed and unconfirmed, transferable and non-transferable, back-to-back, revolving, red-clause credit, stand-by credit)
  • bank transfer
  • documentary collection of bills
  • commercial letter of credit
  • bank draft
  • letter of exchange
  • promissory notes
  • bank guarantees.