The loan portfolio of Ukrainian banks in April 2021 grew by 1.7%, to UAH 1.076 trillion, and the volume of non-performing loans (NPL) – by 0.8%, to UAH 425.88 billion, according to reports posted on the website of the National Bank of Ukraine (NBU).
According to its data, the share of non-performing loans in the banking system in April fell from 39.93% to 39.57%.
The National Bank indicated that over the month the portfolio of loans in the corporate sector increased by 1.9%, to UAH 807.408 billion (including the NPL volume in it – by 0.8%, to UAH 369.615 billion), and the portfolio of loans issued to individuals – by 1.6%, to UAH 218.678 billion (NPL – by 0.7%, to UAH 52.289 billion).
At the same time, the volume of interbank loans increased by 0.6%, to UAH 39.388 billion (including NPL decreased by 0.1%, to UAH 980 million), while the volume of loans issued to state and local authorities decreased by 3%, to UAH 10.909 billion (NPL remained at 0).
According to the National Bank, in April, the share of NPL in the portfolio of loans provided to the corporate sector decreased by 0.5 percentage points (to 45.78%), loans to the population – by 0.2 percentage points (to 25.28%), interbank loans – by 0.2 percentage points (to 2.49%), and loans to state authorities remained at the level of 0%.
The central bank report indicates that the loan portfolio of state-owned banks excluding PrivatBank in April 2021 increased by 0.2%, to UAH 299.733 billion (the NPL volume in it increased by 1.8%, to UAH 131.15 billion), while PrivatBank’s loan portfolio grew by 0.4%, to UAH 246.337 million (NPL remained at the level of UAH 177.99 billion).
In addition, over the month, the loan portfolio of banks with foreign capital grew by 3.5% (to UAH 352.736 billion), and with private capital – by 2.6% (to UAH 177.577 billion), while the NPL volume in them decreased by 0.6% (to UAH 93.55 billion) and by 1.7% (to UAH 23.2 billion).
The National Bank of Ukraine (NBU) has revised its inflation forecast from 7% to 8% in 2021, expecting inflation to return to the 5% target in H1 2022.
“Considering the fast-paced recovery of the global economy and higherinflationary pressures, the NBU revised its inflation forecast from 7% to 8% in 2021, expecting inflation to return to the 5% target in H1 2022 and settle at this level further on,” the NBU said on its website on Thursday.
The central bank said that inflation will peak in Q3 2021. Inflation will start to decelerate in autumn, return to the 5% ± 1 pp target range in H1 2022, and subsequently remain there.
The steep rise in inflation was largely driven by temporary factors, such as growing global prices for food and energy. A revival in the global economy and the effects of smaller harvests continued to push up prices. A low comparison base also played an important role.
Underlyinginflationary pressures increased due to sustained growth in consumer demand, which was, among other things, fueled by higher wages, the NBU said.
Retail turnovers consistently exceeded pre-crisis levels, being 5.6% year-over-year larger in February, the central bank said.
The growth of consumer prices in Ukraine in March 2021 accelerated year-over-year to 8.5% from 7.5% in February, from 6.1% in January and from 5% in December 2020.
According to the State Statistics Service on Friday, in March inflation increased to 1.7%, while in February it was 1%, in January 1.3%.
In addition, the State Statistics Service in March 2021 recorded underlying inflation of 1.6% compared to the previous month and 2.4% from the beginning of the year.
The Ukrainian government expects inflation of 7.3% in 2021, while the National Bank of Ukraine (NBU) 7%. At the same time, the NBU said that inflation in the first quarter was higher than its expectations. According to the NBU, a turning point ininflationary dynamics may occur in August or September 2021.
The largest number of branches of insurance companies (per 100,000 population) is located in Kyiv – 115, Kherson region – 124 representative offices, Zaporizhia – 49, Mykolaiv – 36, Khmelnytsky – 33, Cherkasy – 31, Ternopil-30, Chernivtsi – 28, according to the website of the National Bank of Ukraine (NBU).
At the same time, it is emphasized that in these regions the representation of insurers is 12.2 per 100,000 population.
The NBU also notes that in another eight regions of Ukraine the presence of insurers is significant (2.48 per 100,000 population). These are Lviv region with 57 representations, Odesa – 57, Vinnytsia – 34, Zakarpattia – 31, Ivano-Frankivsk – 28, Chernihiv-22, Kirovohrad – 20.
The smallest concentration of insurers (1.97 per 100,000 population) the NBU notes in Dnipropetrovsk region – 61 representative offices, Kharkiv – 44, Donetsk – 43, Poltava – 27, Rivne – 21, Zhytomyr – 20, Sumy – 20.
As reported, according to the NBU, as of March 31, 2021, the total number of insurance companies in Ukraine was 208, while on the same date a year earlier – 225. In particular, 20 insurers specialize in life insurance.
The net profit of UkrSibbank (Kyiv) in 2020 amounted to UAH 1.324 billion, which is two times less than in 2019 (UAH 2.615 billion).
According to a report on the bank’s website, net interest income for 2020 decreased by 1.3 times, to UAH 3.295 billion, while net commission income remained at UAH 1.7 billion.
By the end of 2020, the bank’s assets increased by 36%, to UAH 72.298 billion, including funds in other financial institutions – by 2.3 times, to UAH 23.5 billion, securities and investments – by 1.4 times, to UAH 18.3 billion, while loans to customers remained at the level of UAH 21 billion.
The bank’s liabilities last year increased by 1.4 times, to UAH 64.13 billion, including customer funds – by 1.4 times, to UAH 63 billion.
The bank’s equity capital in 2020 increased by 19.1%, to UAH 8.17 billion.
The charter capital remained at the level of UAH 5.07 billion.
UkrSibbank was founded in 1990. Its shareholders are BNP Paribas S.A (France), which owns 60% of the bank’s charter capital, and the European Bank for Reconstruction and Development with 40%.
According to the NBU, as of March 1, 2021, in terms of total assets (UAH 70.322 billion), UkrSibbank ranked eighth among 73 operating banks in Ukraine.
The number of banks expecting an increase in the volume of their loan portfolio over the next 12 months amounted to 78% for the corporate segment and 82% for lending to the population, according to the results of a survey conducted by the National Bank of Ukraine (NBU) on the conditions of bank lending.
“The survey participants positively assess the prospects for lending in the next 12 months: 78% of respondents predict the growth of the loan portfolio of corporations, 82% of households. These are the highest estimates of the growth of the loan portfolio of the population since 2015, however, some large banks expect a certain deterioration in its quality,” the review says.
According to the report, the optimism of the respondents regarding the further increase in funding has grown, in particular, 77% of respondents expect an increase in household deposits, 78% – funds of enterprises.
The banks note that despite expectations of the introduction of new quarantine restrictions, the demand for loans increased from business and the population, in particular, the demand for mortgages was the highest in the entire history of observations.
It is indicated that in January-March 2021, the demand for business loans increased, primarily for loans to SMEs, in hryvnias and long-term loans.
The main factors behind the revival of demand are still cited by banks as a decrease in interest rates, the need of enterprises for capital investments and working capital, as well as debt restructuring.
The banks explain the softening of the creditworthiness for business by the high level of liquidity, increased competition with other banks, as well as improved expectations regarding the overall economic activity and the development of certain industries, primarily for SMEs.
According to the survey, almost a quarter of the surveyed respondents noted an increase in the level of approval of applications for business loans and easing requirements for the size of the loan.
It is indicated that 92% of financial institutions rated the debt burden of household borrowers as average, and more than 80% of financial institutions also rated the debt burden of corporate borrowers.
The survey was conducted from March 19 to April 9, 2021 among credit managers of 23 banks, whose share in the total assets of the banking system of Ukraine is 88%.
