Serbia’s non-bank financial industry continued to grow in nominal terms in early 2026, but insurance companies, voluntary pension funds and leasing providers remained a relatively small segment of the overall financial system. At the end of the first quarter of 2026, these institutions accounted for 9.5% of total financial-system assets, limiting their role as an alternative source of financing alongside commercial banks.
The sector was dominated by insurers, which held approximately RSD456 billion, representing 5.8% of financial assets. Leasing companies followed with RSD228 billion, or 2.9%, while voluntary pension funds managed around RSD66 billion, equivalent to 0.8% of the financial system.
Insurance Sector Remains Dominant Within Non-Bank Finance
Ownership of Serbia’s insurance companies is spread among domestic and international investors. Serbian shareholders controlled 33% of insurance companies, followed by Dutch capital with 22%, Austrian investors with 20%, Italian owners with 13%, Slovenian investors with 7%, and other shareholders with 5%.
Despite diversified ownership, insurers’ investment portfolios remain heavily concentrated in government securities. Serbian government bonds represented 91% of assets covering life-insurance technical reserves, while bank deposits and real estate each accounted for 3%.
Non-life insurance companies maintained a more diversified reserve structure. Serbian government securities accounted for 66% of reserve-covering assets, followed by bank deposits at 15%, real estate at 3%, and other investment instruments at 16%. The investment structure limits exposure to volatile equity markets and supports solvency levels, but it also creates a strong connection between insurers and the state bond market. Changes in Serbian government bond valuations would affect multiple parts of the financial sector, including banks, insurers and pension funds.
Insurance underwriting remained profitable, with the combined ratio staying below 100%, indicating that non-life insurers generated underwriting profits before investment income. Both life and non-life insurance businesses recorded positive profitability during 2025.
Pension Funds Focused on Government Debt Investments
Voluntary pension funds remained the smallest segment of Serbia’s institutional investor base. Their net assets decreased slightly from approximately RSD67 billion to RSD66 billion, despite the long-term increase recorded by the FONDex investment index.
Portfolio allocation continued to favour low-risk instruments. Government securities represented 66.4% of pension-fund assets, while deposits accounted for 14.5%, equities for 10.8%, foreign investments for 6.1%, and corporate bonds, investment funds and receivables for 2.2%.
The structure reduces exposure to market volatility but limits the role of pension savings as a source of long-term capital for domestic businesses, infrastructure development, renewable-energy investments and private-market financing. A larger institutional investor base would be required for Serbia’s corporate bond market and listed equity market to expand further.
Leasing Market Concentrated on Vehicles and Transport Assets
Leasing companies represented the most commercially active part of the non-bank financial sector, although their portfolios remained highly concentrated in vehicle financing. Companies accounted for 83.6% of leasing placements, followed by entrepreneurs at 7.1%, local governments at 3%, individuals at 2.3%, farmers at 2%, and public enterprises at 1%.
Passenger vehicles made up 45.2% of leased assets, while trucks and buses accounted for 35.9%. Construction machinery represented 7.3%, agricultural equipment 3.4%, service equipment 2.5%, and production machinery 2.4%. With more than 81% of leasing exposure linked to vehicles, the sector benefits from demand for fleet replacement and commercial transport financing. At the same time, its performance remains connected to used-vehicle values, automotive market conditions, logistics activity and the cash-flow position of borrowers.
Non-Bank Finance Still Limited as Alternative Funding Source
Serbia’s non-bank financial institutions remain conservative and stable but have yet to develop into a major source of financing for corporate growth, infrastructure investment, energy projects or start-up companies. A broader non-bank financial market would expand funding options beyond traditional bank deposits and lending, while increasing the role of institutional capital in supporting economic activity.
