You have 5 free articles left this month. Get your free Basic subscription now and gain instant access to more.

Serbian banks' NPL ratio falls to 3.5% at end-August - fin min aide

Author Radomir Ralev
Serbian banks' NPL ratio falls to 3.5% at end-August - fin min aide Source: Serbian Finance Ministry

BELGRADE (Serbia), November 5 (SeeNews) - The ratio of non-performing loans (NPLs) to total loans in Serbia's banking sector fell to 3.5% at the end of August, backed by auctions for their sale and regulatory reforms, Ognjen Popovic, an advisor to finance minister Sinisa Mali, said on Friday.

"A drastic decline in NPLs has been achieved as a result of a comprehensive change in the legal framework, as well as the strengthening of institutions and the adoption of bylaws, which have enabled banks and other financial institutions to address this issue," Popovic said in a press release issued by the finance ministry.

The ratio of non-performing loans in Serbia's banking system fell to 3.6% at the end of June from 3.9% in March 2021 and 3.7% in June 2020, the Serbian central bank said last month.

The sale of two portfolios of NPLs in 2019 and 2021 additionally contributed to the reduction of the NPL ratio and enabled banks to focus on their core business, because managing huge receivables requires huge human resources, Popovic said.

"This is an efficient way to entrust this job to people who deal with it professionally, to speed up the process, and to return real estate and all other forms of property that have been frozen to economic flows as soon as possible. In this way, we unlock growth and raise the living standard of citizens," he noted.

Serbia's central bank started regular monitoring of NPLs in 2008. After a temporary decrease in the second half of 2012, NPL ratio rose again in 2013 and continued to grow in 2014, reaching record-high 22.5% in 2015.

Compare