The share of non-performing loans in Ukrainian banks has decreased.

The share of non-performing loans in banks has decreased

As of early April 2025, the share of non-performing loans (NPL) in the banking sector has dropped to 28.6%, which is 1.7 percentage points lower than at the beginning of the year. This information was disseminated by representatives of the National Bank.

According to the National Bank, the volume of non-performing loans decreased by UAH 10.7 billion in the first quarter, to UAH 382.6 billion, which represents a decrease of 2.7%. This downward trend has been ongoing since the beginning of 2023.

Key factors for the reduction of the NPL share:

The write-off of corporate and retail non-performing loans. The share of non-performing loans for individuals decreased by 1.2 percentage points to 14.3%, while for businesses it dropped by 1.9 percentage points to 37%; further growth of high-quality hryvnia loans. The volume of gross loans in banks increased by UAH 40.7 billion in the first quarter, or by 3.1%.

A recorded decrease in the share of non-performing loans in all groups of banks:

• in private Ukrainian banks - down to 10%;
• in banks with foreign capital - down to 10.2%;
• in state banks - down to 41.1%.

According to the results of the quarterly Bank Lending Conditions Survey, banks expect an increase in demand for loans from businesses and individuals and predict an increase in the loan portfolio over the next 12 months. Respondents believe that the quality of corporate loans will remain at the same level but may slightly deteriorate for household loans.

Effectiveness of the National Bank's work

By analyzing the provided data, it can be concluded that the National Bank's efforts to reduce the share of non-performing loans in the banking sector appear to be effective. The reduction of the NPL level indicates positive trends in the financial sector, which may influence the overall stability of the country's economy.