The net loss of Ukrainian banks in January-April amounted to 7.43 billion UAH. A year ago, during this period, banks collectively made a profit of 17.54 billion UAH, the NBU reports.
The main loss was absorbed in April — 7.27 billion UAH, although banks worked with a net profit of 9.9 billion UAH in January — February.
The main reason for this increase in the banks' spending is a significant increase in deductions to reserves for expected losses over the consequences of the war. Due to this operation, banks insure themselves and their clients against possible real losses.
In general, the banks' spending for March — April increased by 53% to 96.0 billion UAH, including:
- interest expenses — by 4.9%, to 17.74 billion UAH;
- commission expenses — by 12.8%, to 11.3 billion UAH;
- expenses of deductions to reserves — by 6.8 times, up to 32.73 billion UAH.
The overall slowdown in business activity since the start of the war has led to a drop in demand for loans and banking services and has resulted in lower settlement amounts — a key base for the banks' fee and commission income. The introduction of repayment holiday by the banks and the reduction of fees for using their services also had a negative impact on the income of the financial institutions.
Nevertheless, the banks’ income for four months increased by 10.6% compared to the same period last year — up to 88.61 billion UAH, including:
- interest income increased by 18.9% to 61.14 billion UAH;
- commission income decreased by 8.9% to 24.47 billion UAH.
As of April 1, out of 69 solvent Ukrainian banks, 44 were profitable and generated a net profit of 5.85 billion UAH, 25 were unprofitable with a loss of 6.01 billion UAH.
"The banking sector remains operationally profitable despite lower growth in operating income and increased operating expenses as a result of hostilities," the NBU assured.