The share of non-performing loans (NPLs) in Ukraine's banking sector increased for the first time in around three years at the beginning of the summer, reversing a prolonged period of improvement as lending to households and businesses accelerated, reported Ukraine Business News.
As of June 1, non-performing loans accounted for 12.8% of the banking system's total loan portfolio, up by approximately 0.2 percentage points from a month earlier.
The increase marked the first monthly rise in the NPL ratio since 2023, when Ukrainian banks began steadily reducing their stock of distressed assets following years of balance sheet clean-up and the economic disruptions caused by war.
The latest uptick comes against the backdrop of rapidly expanding lending activity to both consumers and companies. As banks increase credit issuance, a modest rise in problem loans is not unusual, particularly during periods of strong portfolio growth.
The increase interrupts what had been an almost uninterrupted downward trend in the NPL ratio over the past three years. During that period, banks benefited from improving asset quality, loan restructuring programmes and the gradual stabilisation of the financial sector despite wartime conditions.
Don’t just follow the news—understand it.
The IntelliNews PRO service includes access to reports, exclusive market data, and more news that decision-makers care about. Stay ahead of the market with IntelliNews PRO.
Sign Up NowRelated Articles
Canada’s Ksi Lisims finalises 20-year LNG contract with Uniper
Cargoes from the proposed project in British Columbia could begin being delivered by as early as 2032. What: German utility Uniper has closed a 20-year deal with Ksi Lisims LNG to begin ... more
PrivatBank to auction major real estate assets including football stadium
Ukraine's state-owned PrivatBank plans to auction several of the country's largest real estate assets by the end of 2026, including a major football stadium, a shopping centre and part of a leading ... more
Iran demands compensation from Ukraine over Caspian ship attack
Iran has demanded full compensation from Ukraine for an attack on an Iranian vessel in the Caspian Sea, Foreign Minister Abbas Araghchi said, Mehr reported on July ... more