2010 period of stabilization for banks - analyst
2011-02-22 18:05:47
Last year was a period of stabilization for the Ukrainian banks. In particular, household deposits grew by 28.5% against their falling by 1.9% in 2009 (during the massive outflow of deposits the banking system lost about 25% of the deposit base of the population). This data from the report of member banks of the forum of leading financial institutions was quoted by an analyst at Raiffeisen Bank Aval, Dmytro Solohub.
Household deposits in the national currency grew more rapidly than in foreign currency (41.6% and 17.4%). The share of long-term deposits rose from 27% at the end of 2009 to 39% at the end of November last year.
Financial performance and condition of capital in the banking system improved. Bank losses decreased nearly threefold, from 34.8 billion UAH to 13 billion UAH (1 USD - 7.94 UAH). The number of unprofitable banks decreased from 64 to 41 at the end of September. The indicator of capital adequacy reached 20.8%, while the volume of regulatory capital increased by 25 billion UAH.
Last year, the total loan portfolio of the banking system increased by only 1%. Corporate loans grew by 7.9%, while the retail loan portfolio decreased by 13%. However, investment in government securities increased by 180% to 54 billion UAH. The share of securities in total assets of the banking system increased from 4% to 8%, while the share of loans declined from 67% to 59%.
In the second half of the year, the situation with the crediting somewhat improved. Interest rates reduced against the increasing liquidity. Rates on new loans in the corporate segment decreased from 25-28% at the beginning of the year to 15-18% at the end of the year.
Ukrainian banks have regained access to the international capital market (placement of Eurobonds and syndicated loans). However, the demand remained limited because the volumes of lending in foreign currencies were almost zero.
External bank debt declined from 42 billion to 20 billion dollars.
A high level of bad loans is still a problem of the banking sector. According to the National Bank, their amount is approximately 85 billion UAH, Dmytro Solohub said.
The forum of leading financial institutions was established in May 2010. Its founders are 9 banks with foreign capital. The mission of the Forum is to introduce the best international practices of governance and management of the Ukrainian financial market.