Macedonian banks’ loan quality, capital adequacy weaken

By bne IntelliNews December 2, 2014

The loan quality and capital adequacy of Macedonia’s banking system have deteriorated slightly, data from the central bank showed. The sector's non-performing loan (NPL) ratio rose to 12.2% at end-September from 11.8% at both end-June and end-September 2013. At the same time, its capital adequacy ratio fell to 16.5% from 16.9% at end-June and 17.3% at end-September 2013.

A sector breakdown among the country's three large, eight medium-sized and four small banks shows NPL ratios of 13.9%, 8% and 16.9%, respectively. Notably, the indicator worsened only for large banks - from 13.2% at end-June and 12.1% at end-September 2013.

Medium-sized banks were best capitalised, with a capital adequacy ratio of 18.3% at end-September, trailed by large banks with 15.6% and small banks with 14.9%.

The data showed also that the stock of gross loans to the nonfinancial sector increased by 9.3% y/y to MKD244.2bn (€3.96bn, 46.5% of GDP) at end-September. Large, medium-sized and small banks accounted for 63.7%, 30.7% and 5.7% of the total.

The banking system's total assets were 6.2% higher y/y at MKD385.4bn at end-September.

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