TIRANA, July 10 /ATA/ The Bank of Albania announces that the non-performing loan increased to the level of 5.23% in May.
Compared to April this year, non-performing loans in May increased by 0.05%.
According to the BoA, in May this indicator reached an all time high since July 2022, reflecting the increase in interest and rising inflation, as a factor that slowed down the repayment of loans that individuals received from banks.
In its analysis, BoA notes that loan interests have been increasing until March, as a result of the tight monetary policy followed by the Bank of Albania, which has increased the base rate several times since March 2022, bringing it to 3% currently from 0.5% that was over a year ago. This trend was reflected in increasing cost of loan interests and, therefore, the monthly installments paid by businesses and individuals.
Also in May, inflation returned to a slight upward trend, after six months when it had only shown a slowing trend.
The Bank of Albania informs that, in response to these indicators, credit to the private sector continues to grow and the financial health of the banking sector suggests that this sector will be able to continue responding to the economy’s demands for funds.
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