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International financial crisis of the last decade had a negative influence in almost all banking system of the world. The difficulties on managing problems brought into consideration that the balance of risk exposure versus return is very difficult to be controlled. Managers of the businesses are working hard to meet liquidity needs and to continue their business which is greatly supported by financial intermediaries. On the other side, banks and their regulators are following risk problems with increased management measures, as stability of financial system was undermined seriously from financial crisis and structural problems in all countries. There are several risks that all kind of businesses are exposed, but in this paper we are focused to credit risk in the banking system, which is counted as 60-70% of total risk exposure. Recently the Albanian economy is having low growth with the banking system suffering from the increase of non- performing loans (NPL). This reflects liquidity and performance problems for businesses with increased risk on financial stability. This paper deals with proof of macroeconomic factors that influence NPL rate for Albania. Verification of these factors can support the proper policies that reduce the NPL level. The analysis includes the comparison of Albanian and Italian data on the trends and factors that affect NPL rate. Albanian Central Bank and government are trying to apply prudent regulations based on analysis of factors driving bad performance. The analysis and findings of this paper is based on existing literature that is applied with a regression model. DOI:10.5901/mjss.2015.v6n1p391

During the last two decades the process of decentralization has been extended worldwide. This process has taken place in developed countries but in nowadays, this process is also being applied in developing countries in order to challenge the monopoly of centralized decision making of governments. The decentralization reform in Albania has done progress during the transition period. Today the local governance in Albania is absorbing and implementing the decentralization legal framework which is approved up to now and also is moving toward a complicated but progressive process of decentralization and autonomy that combines the decentralization of functions/services with fiscal decentralization supported by the process of strengthening the local democracy and accountability through free election and local community participation. This practice is supported by the economic theory of decentralization that it is a process that can and should lead to the improvement of the services that citizens receive from government by balancing local needs and expectations regarding the quantity, quality, cost and mix of services. This paper makes a snapshot of the process of decentralization by evaluating what has already been achieved, what is in process and what are the challenges laid ahead. It does the analysis of fiscal decentralization and fiscal autonomy in Albania and also gives a short description about the European models (West and East European countries). This paper touches upon the main achievements and challenges on all the complex issues that relate to decentralization. It is mainly focused on the progress of decentralization during the last couple years. DOI:10.5901/mjss.2013.v4n10p524