Bank of Albania: “Bad loans, lowest level in six years”

Official data from the Bank of Albania say that the bad loans in June reached 15.58%, from 15.86% that it was in May.

Compared to June of one year ago, bad loans have decreased with 4.5%. Compared to 2014, 10%.

The Bank of Albania says that the drop of bad loans was mainly due to restructuring and removing of loans. Banks remove from their balance all loans that have not been paid for the past three years. This request was imposed by the Bank of Albania.

In parallel, some of the banks are also deleting problematic loans newer than three years, when borrowers accept to pay part of the debt. The sum is agreed on between the bank and borrower.

Sources from the Bank of Albania say that this method has been efficient for reducing the bad loan portfolio, while restructuring has continued. Restructuring means that banks accept to delay the payment deadline for borrowers and reduce the interest rate.

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