Bank profits increase five times
04/07/2014 00:00
The Washington Agreement Must Be Reactivated! 06/01 19:04
Private banks profited 50 million USD for the first five months of this
year, 10 million USD each month. Recent data from the Bank Associations
show that compared to one year ago, the banking system profits have
increased with five times, marking a historic record.
Figures show an improvement in all indicators that measure the profit. The return from their capital, which measures the profit rate for every investment was 11.2% by the end of these five months.
This means that for every 100 ALL of invested capital, shareholders have taken back 11.2 ALL as profit for the first five months. One year ago this figure was 2.2%.
The improvement comes when the main activity of banks is that of financial intermediation, which is decreasing, compared to one year ago.
The deposits in the system have frozen for some months, while loans by the end of these five months were 1.7% lower than one year ago.
Bank of Albania experts say that most of the profits were generated after a drop in the funds that banks need to leave aside for covering bad loans.
Bad loans have stopped growing and are now stable at 24%. This has freed banks from the obligation for freezing new funds for covering the losses that comes from problematic loans.
Data show that 2014 will still be a difficult year for the economy, but apparently not for the financial system.
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