The National bank of Croatia does not directly influence the allocation of financial resources in the economy any more. The NBC does control the prescribed capital adequacy ratio and other prudential control limits. However, banks cannot immediately change the quality of their portfolio and are still burdened with nonperforming loans from the past.
Enterprises still have great influence in managing boards in some banks.
Poor economic performance of some regions make that political and social criteria are more often than not substitutes for sound economic management. Main Statistical Indicators Vol. Out of total assets, claims on central government represent about 30 percent and claims on other domestic sectors 49 percent of total assets. Compared to 1993 claims on enterprises have risen, which is a good indication that banks are lending more to business related activity. But, banks finance the central budget deficits in basically two ways.