Ukraine’s banking sector increases losses as war rages

A normal view reveals the headquarters of the Nationwide Financial institution of Ukraine in Kiev, Ukraine April 18, 2019. REUTERS/Valentyn Ogirenko

KYIV, Could 24 (Reuters) – Ukraine’s banking system posted a web lack of 7.4 billion hryvnias ($253 million) in January-April, an increase from 0.16 billion hryvnias in January-March, as Russia pressed on with its army offensive, central financial institution knowledge confirmed on Tuesday.

In April, banks needed to switch an extra 11.2 billion hryvnias of their earnings to reserves to cowl potential future losses linked to the battle. In March, banks transferred to reserves virtually 15.8 billion hryvnias.

Russia’s invasion on Feb. 24 has harmed enterprise actions, prevented many corporations and people from servicing their loans and led to the banking system’s first losses since 2017. learn extra

The central financial institution stated the return on property ratio of the banking system – an indicator of profitability – had worsened to minus 1.11% as of end-April from minus 0.03% as of end-March.

The central financial institution has stated the battle might trigger Ukraine’s financial system to contract by at the least one-third in 2022 and drive up inflation to over 20%.

($1 = 29.2500 hryvnias)

Reporting by Natalia Zinets, Enhancing by Timothy Heritage

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