Ukraine’s banking system for the first time in five years ended the first half of the year with a net loss.
Ukrainian banks received a net loss of UAH 4.6 billion in the first six months of 2022, the National Bank reported on Thursday, August 11.
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At the same time, almost the entire loss was generated in the second quarter – 4.5 billion rubles.
The negative financial result is determined by the significant amount of reserves formed for expected losses due to the consequences of the war: banks formed reserves for UAH 57.9 billion, where in March-June – for UAH 52.1 billion.
“The realization of credit risk as a result of a massive war has led to the unprofitability of the banking sector for the first time in the last five years. Reserves for credit losses will continue to grow,” said Yaroslav Matuzka , deputy head of the NBU.
The growth rate of banks’ net interest income slowed from 35% in January-February to 19% in March-June on an annual basis.
The decrease in demand for banking services limits the fee income of banks. Net fee and commission income fell 35% yoy in March-June compared to a 15% yoy growth in January-February.
Net operating profit before provisions for the second quarter amounted to UAH 33.5 billion against UAH 23.5 billion in the second quarter of 2021.
As of July 1, out of 68 solvent banks, 47 banks were profitable and received a net profit of UAH 10 billion, 21 – losses of UAH 14.6 billion.
Recall that last year Ukrainian banks received a record profit – UAH 77.530 billion, which is 95.2% more than in 2020 (UAH 39.727 billion).
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Source: korrespondent
I am Dylan Hudson, a dedicated and experienced journalist in the news industry. I have been working for Buna Times, as an author since 2018. My expertise lies in covering sports sections of the website and providing readers with reliable information on current sporting events.