Non-performing loans at 14.5%, the lowest level since December 2010

Non-performing loans declined again in October, touching the lowest level since December 2010.

According to Bank of Albania’s statistics, the ratio of non-performing loans fell further to 14.5%, from 14.8% that it was at the end of September.

Figures show that the decline in bad loans has been sustainable in time and is at the levels of the early years of the crisis.

According to bankers, the removal of old non-performing loans has brought a more realistic picture of the banking system portfolio.

Now, the main effect on reducing the ratio of non-performing loans comes from the rise, however modest, in lending, and also the effective use of the early credit restructuring mechanism.

Reducing non-performing loans is affecting the improving of financial performance of banks.

The ratio of return on equity, which measures the gain against the share capital, remains at a much more satisfactory level, at 16.3% for October.

The data show that the key element in the growth of profits this year is precisely the drastic reduction of non-performing loan provisioning costs.

Meanwhile, the capitalization and liquidity indicators of the banking system remain quite high, which, among other things, also shows considerable potential for boosting lending.

At present, this growth remains modest, albeit in positive value.

SCAN

*Material i përgatitur nga portali SCAN. Ripublikimi mund të bëhet vetëm kundrejt citimit të autorësisë dhe burimit origjinal.