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(MENAFN – UkrinForm) Banks received 10.9 billion UAH of net profit in January-March 2021, 32% lower than in the first quarter of 2020, when the banking sector earned more than 16 billion UAH, the press service of the National Bank of Ukraine (NBU) reported.
“The main factor holding back the growth in profitability of the sector in the first quarter was changes in the fair value of securities. The total result of buy and sell and revaluation operations is “less†5.1 billion UAH, compared to the positive result of UAH. 7.7 billion in the first quarter of 2020, “the NBU said.
At the same time, the regulator noted that the volume of reserves built up by banks for expected losses in January-March decreased by 58.3%, to 2 billion UAH. For comparison, in the same period of 2020, banks built up reserves of 4.7 billion UAH.
“The gradual recovery in demand for banking services with the current decline in the cost of funding has had a positive effect on banks’ interest income. Net interest income increased 21.9% year-on-year compared to 6.8% year-on-year last year. The intensification of non-cash transactions helped increase net fee and commission income from January to March by 15.1% year-on-year. In the first quarter of 2020, they only increased by 7.9% year-on-year. Net interest and commission income is now sufficient to cover the costs of most banks, â€said the NBU.
As of April 1, out of 73 solvent banks, 66 recorded profits in the first quarter of 2021. Only seven banks suffered losses (a total of 100 million UAH). Above all, the sector’s profits have become less concentrated: the five most profitable banks accounted for 57% of the gross margin, up from 83% in 2020, according to the NBU.
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