Volume of non-performing loans volume increases by UAH 30 billion, says NBU

1 November, 11:45 AM
Money stock photo hryvnia (Photo:NBU press center)

Money stock photo hryvnia (Photo:NBU press center)

The volume of non-performing loans in Ukrainian banks has increased by more than UAH 30 billion (about USD 809 million) over the last month, the Ukrainian central bank, the National Bank of Ukraine, reported on Telegram on Oct. 31.

The share of non-performing loans (NPLs) in the banking sector, as of Oct. 1, increased to 33.6% compared to 30.8% on Sept. 1, according to the NBU.

Thus, the volume of NPLs increased by UAH 30.4 billion (about USD 820 million) in September, and by UAH 59.6 billion (about USD 1.6 billion) in the third quarter. In July-September, the share of non-performing loans in the portfolio increased by 3.9%.

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The growth of problem loans is directly related to the consequences of Russian aggression, the NBU said.

“Loss of income, destruction of assets and collateral, deterioration of borrowers’ solvency – all of these negatively affect the quality of the loan portfolio, leading to an increase in losses from credit risk and to a further increase in the share of NPLs,” the central bank said.

However, the level of NPLs will not increase rapidly, as banks are allowed to conduct flexible restructurings to support debtors, the NBU said. Such restructurings will allow a number of debtors to survive difficult times and return to timely servicing of loans, it added.

According to NBU surveys, Ukrainian banks in July-September showed a further slowdown in crediting during the war.

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