Banking sector assets up by 8.6% in Q3

TIRANA, Nov. 19 – The assets of the banking system at the end of September 2012 amounted to ALL 1.189 trillion, registering an annual growth rate of 8.6 per cent, and increasing during the third quarter of 2012 by 2.7 per cent or ALL 18.4 billion, the Albanian Association of Banks says.
Deposits placed with banks, at the end of the third quarter of 2012 amounted to about ALL 995 billion, increasing by ALL 33 billion over the quarter, and 10.2 per cent on an annual basis. The increase of the deposits basis was supported mainly by the growth of individuals’ deposits that marked at end-September a steady annual growth rate of about 11 per cent, and were 2.8 per cent higher than in the second quarter of 2012. Meanwhile, in line with their seasonal behaviour, deposits of businesses also reflected growth, increasing over the third quarter by ALL 9.6 billion or by 7.8 per cent compared to end-June 2012.
Outstanding loans granted by banks to the economy increased during the third quarter 2012 with about ALL 5.3 billion, marking an annual growth rate of 6.4 per cent. Outstanding loans granted to individuals increased by 1 per cent throughout the quarter in contrast to the downward trend of previous quarters. Meanwhile, the new loans granted by banks during the quarter amounted to approximately ALL 59.2 billion. About 85 per cent of the new loans were granted to businesses; 43 per cent of them were in local currency, 49 per cent in Euro and 8 per cent in U.S. dollars.
Non-performing loans at the end of the third quarter amounted to 22.7 per cent compared to 21.1 per cent at the end of the second quarter 2012. At the end of September, the ratio of lost loans was approximately 7 per cent. These indicators reflect the difficulties faced by the business community under the current economic conditions, but also the difficulties faced by banks in the execution of loan collaterals. The banking system remains well capitalized with a capital adequacy ratio of 15.9 per cent at the end of the third quarter, compared to 15.7 per cent at the end of the second quarter. At the same time, the good performance of deposits confirms that the system has sufficient liquidity to expand its role as a financial intermediary in the economy.