Ukrainian banks expect further loan growth and Deposit inflows, ascertain slight decrease credit risk and liquidity risk, and increasing interest rate risk.
This is evidenced by the results of the survey “On the terms of Bank lending” held by the National Bank of Ukraine in the first quarter of 2020.
According to the report, 84% of respondents predict an increase in corporate loan portfolio and 71% of retail. Clarifies that large banks expect a revival of demand for mortgage lending.
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All respondents predict an inflow of deposits of both enterprises and households. Also the majority of surveyed banks expect faster growth of funding from corporate clients.
As noted in the report, the expectations of the banks regarding the loan portfolio quality has improved, whereas in the previous two quarters it was predicted slight deterioration.
According to the survey of the NBU, mainly large banks expect that in the first quarter of 2020 insignificant decrease credit and operational risks, and interest rate risk, currency and liquidity risk will not change.
In addition, in the first quarter of 2020 banks expect easing of standards for loans to small and medium enterprises (SME), the national currency loans and short term loans and consumer credit.
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However, Ukrainian banks have registered an increase in demand of the population and business loans in the fourth quarter of 2019, mainly due to lower interest rates. In addition, the increased competition for quality borrowers among financial institutions have impacted the easing of lending standards for individuals and legal entities, the document says.
Assessment of banks in the fourth quarter, the overall level of risk fell slightly due to a decline in credit risk and liquidity risk, the foreign exchange and operational risks have not changed and the interest – increased marginally from 18% of respondents.
It is known that the survey was conducted from 17 December 2019, 10 January 2020 among credit managers, 49 banks, whose share in the total assets of the banking system is 99%.