The banking system grew during the crisis – Assets increased by 250 million euros in five months
The banking system has continued to grow during the months of the Covid-19 crisis. Data from the Bank of Albania show that total assets increased by ALL 31 billion or about EUR 250 million in the period from February to July. On an annual basis, the sector has a growth rate close to the level of 6.5%. The growth of the banking sector during the months of crisis has relied especially on investment in Albanian government securities.
The increased demand to cover the deficit increase caused by the Covid-19 crisis has been covered mainly by the banking sector. Moreover, Albanian banks were among the main investors in the Eurobond of 650 million euros issued on the London Stock Exchange. Euro bonds have given banks a good opportunity to invest cheap liquidity in foreign currency.
Meanwhile, the loan has continued to grow, but at a slower pace, which is understandable in terms of the severe shock that the private sector of the economy received from the first wave of Covid-19. In gross terms, the loan portfolio increased by about ALL 17 billion or about EUR 137 million. Lending showed a positive performance, especially in May and June, driven by the sovereign guarantee schemes of the Albanian government.
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