The profit of the banking sector during the period January-November 2020, saw the lowest level since 2016, reaching the value of 14,35 billion ALL, or around 116 million euros. For the same period of time in 2019, the net profit was reported to be 18,25 billion ALL, or around 147 million euros. While the profits have fallen, overall the banking sector in Albania has managed to limit the effects of the economic crisis in Albania, caused by the tragic earthquake in 2019 and the COVID-19 pandemic.
According to Monitor magazine, “the decrease in profits for this year is mainly due to the increase in provisions for bad loans. By the end of the 9 months period of 2020, the costs for provisions had increased three and a half times compared to the same period last year.” The lending volumes are considered another factor that has helped the overall results of this year since in the second half of 2020 they have seen continuous growth. Also, the growth of new credit during the period June-November by 6.3% compared to the same period in 2019, will help maintain a stable share of bad loans, while increasing the loan portfolio.
