Banks earned UAH 118 billion in profit in 9 months: NBU explains how
12 November 10:29
In the first nine months of 2024, solvent banks maintained profitability and received UAH 118 billion in net profit. This is reported by Komersant ukrainskyi with reference to the NBU.
It is noted that the main factor of profitability remains the maintenance of a high net interest margin, given the growth in lending and investments in government bonds.
Thus, according to the NBU, in the third quarter, the average yield on loans and the portfolio of domestic government bonds practically stabilized, and the volume of such instruments continued to increase. Thus, the volume of the gross hryvnia portfolio of loans granted to customers has increased by 14.5% since the beginning of 2024 (net portfolio – by 23.6%), and the volume of investments in government bonds – by 21.1%.
“At the same time, the cost of funding decreased slightly following the decline in market deposit rates. Therefore, banks maintained a fairly high net interest margin. Despite further cost increases, operating efficiency remained high. At the same time, the high quality of the loan portfolio resulted in a low level of allocations to provisions for credit risks,” the statement said.
The NBU clarified that according to the results of 9 months of this year, only eight small banks out of 62 solvent banks were unprofitable with a total loss of UAH 342 million. These are mainly institutions with inefficient business models and a number of long-standing problems.
As financial results grew, so did the amount of income taxes accrued by banks, which amounted to UAH 35 billion over the period.
The banks’ return on equity in the first nine months of 2024 amounted to 45.8%, down from 56.9% in the previous year. If the law that provides for a 50% tax on bank profits comes into force in 2024, the return on equity in the sector will decline to about 30%. This will slow down the accumulation of capital by banks to strengthen their own sustainability and further lending to the economy.
The NBU reminded that in 2023, according to updated data, banks received UAH 82.8 billion in net profit after charging UAH 76.2 billion in income tax at an increased rate of 50%.
