Ratio of bad loans to individuals drops to 9.4%: BoA
The ratio of non-performing loans for individuals has now dropped to one-digit levels.
According to data from the Bank of Albania, in the middle of this year, the level of non-performing loans to individuals dropped to 9.4%, from 12.5% at the end of last year.
Figures show once again that lending to households today is a safer business for banks, mainly due to the better distribution of credit risk.
This explains best why in recent years banks are focusing more on lending to individuals, facilitating credit standards and significantly lowering interest rates.
Considering the statistics of the Bank of Albania, lending to households expanded by 2.5% during the first half of this year.
The level of non-performing loans is also improving for businesses, but it remains significantly higher compared to households.
In June this year, the ratio of non-performing loans to business was 19.4%, from 23% at the end of last year.
Despite qualitative improvements, banks continue to be conservative in lending to enterprises.
During the first half of the year, the loan portfolio for resident businesses in Albania fell by 3% compared to the end of 2016.
SCAN
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