State-owned banks reduced NPLs by UAH 87 billion

The state-owned banks continue the reduction of their non-performing loan (hereinafter- NPL) portfolio. Thus, in 2020, state-owned banks reduce their NPLs by 22% or UAH 87 billion to UAH 310 billion. The share of NPLs in the state-owned banks’ loan portfolio decreased to 57.4%. 

In 2020, all public sector banks reduced their non-performing loan portfolios. The decrease in the level of NPLs accumulated in state-owned banks was mainly due to the write-off of distressed assets from the banks' balance sheets (banks in the sector wrote off loans from reserves amounting to over UAH 123 billion).

In addition, in 2020, public sector banks restructured NPLs in the amount of about UAH 42 billion, of which more than half (UAH 23 billion) under the Law of Ukraine "On Financial Restructuring". The amount of overdue debt of public sector banks was also reduced by UAH 6 billion.

In the sectoral context, the largest volume of non-performing loans of state-owned banks is traditionally concentrated in wholesale and retail trade, production of chemicals and chemical products, food production, and metallurgical production.

The issue of solving the problem of NPLs for both the banking system as a whole and state-owned banks remains extremely urgent and important.

In accordance with the updated Principles of Strategic Reform of State-Owned Banks, solving the problem of NPLs in public sector banks is one of the Government's priorities.

To address issues related to the reduction of non-performing loans, state-owned banks have also been active in debt collection legal claims. As of January 1, 2021, there were more than 68,000 lawsuits filed by state-owned banks in the amount of UAH 78 billion.

In 2020, more than 94,000 new lawsuits worth about UAH 31 billion were filed, more than 100,000 court decisions worth about UAH 23 billion were obtained, and more than 101,000 enforcement proceedings worth UAH 51 billion were opened.