• 18/07/2024 22:04

The share of non-performing loans in banks in 2023 decreased to 37.4%

The share of non-performing loans (NPL) in the banking sector as of January 1, 2024 amounted to 37.4%, which is 0.8 percentage points lower than the figure for January 1, 2023. The volume of non-performing loans over the year decreased by UAH 9.7 billion to UAH 422.4 billion. This was reported by the NBU press service.

The share of non-performing loans in banks in 2023 decreased to 37.4%

Read telegram -channel “Ministry of Finance”: main financial news

Reasons for the reduction in the share of NPL

According to the regulator, the key factor in reducing the share of NPL is the growth of credit portfolio, because lending continues in conditions of a full-scale war.

In 2023, thanks to improved demand for hryvnia loans, given the resumption of business activity, the portfolio of net corporate loans grew for seven months in a row, including outside government programs. Retail unsecured consumer and mortgage loans are growing.

Other reasons for the reduction in the share of non-performing loans are the restructuring and subsequent resumption of servicing of bad debts by corporate clients, which occurred mainly in state-owned banks, as well as the write-off of non-performing loans to individuals.

“Despite the active work of banks to resolve non-performing loans, their share remains quite high. An important reason for this is a full-scale war, which led to a new wave of customer defaults,” says the National Bank’s message.

In particular, according to a NBU study, in October 2023, “war” non-performing business loans accounted for 31% of their total volume . During the war, the retail portfolio accumulated more than half of the current volume of non-performing loans.

“Banks properly assess credit risk and recognize bad debt in a timely manner. This was once again confirmed by the sustainability assessment, which was completed in 2023,” the regulator added.

According to the analysis, the majority of “military” NPLs are not directly related to occupation or destruction, so these borrowers will be able to resume servicing loans with subsequent economic recovery.

In addition, banks are actively working with problem assets, primarily carrying out restructuring. According to the survey, banks restructured UAH 73 billion or more than 89% of “war” non-performing loans.

Loans of debtors whose main assets were lost or located in occupied territories or in a combat zone were reserved by more than 77% .


Before Russia’s full-scale invasion of Ukraine, the share of non-performing loans (NPL) in Ukrainian banks began to decline since 2018 (from 55% to 27% as of March 1, 2022 ).


Leave a Reply

Your email address will not be published. Required fields are marked *