Lending to businesses and population up in Q1 - NBU

The National Bank of Ukraine (NBU) reports that during January-March of this year, lending to businesses and population grew.

This is stated in the NBU material, Ukrainian News Agency reports.

The growth of the net hryvnia loan portfolio of businesses in the first quarter accelerated to 9.5% compared to the previous quarter and to 28.4% in annual terms. Banks of all groups briskly increased the volume of loans. Traditionally, the volume of loans to farmers, wholesale trade enterprises, as well as in the construction and mechanical engineering sectors grew.

The NBU notes that business demand for financing capital investments remains. In the first quarter, loans with a maturity of over three years increased by 8.5%. Medium-term loans with a maturity of one to three years grew at a faster pace - by 21.6% in the first quarter and by over 34% in the year. In contrast, the volume of short-term loans up to one year has remained almost unchanged.

At the same time, the volume of net hryvnia loans to individuals continues to grow briskly: 6.7% per quarter and 35.9% per year. Traditionally, unsecured loans dominate the portfolio. In contrast, the growth of the mortgage loan portfolio has slowed down for the third quarter in a row, which is explained by the further restructuring and corresponding slowdown of the eOselia program, which dominates mortgage lending.

The NBU notes that the quality of the loan portfolio is improving. The share of corporate borrowers that defaulted on hryvnia loans in the first quarter decreased to about 3% - this is better than the average indicators before the full-scale invasion. The definition of non-performing loans (NPL) according to the updated methodology in accordance with EU requirements did not have a significant impact on the share of NPLs.

This share decreased by 1.7%. pp per quarter and by 7.5 pp per year - to 28.6% (17.1% - excluding old bad debts of state banks and debts of former owners of JSC CB PrivatBank).

As Ukrainian News Agency earlier reported, the volume of loans issued by commercial banks to the corporate sector and individuals, according to the latest data of the National Bank, increased by 1.7% in April to UAH 1,164.954 billion.

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