In Q 1 2017, solvent banks posted UAH 5.09 billion in net profit, with the banking system delivering a profitable performance for three consecutive months. Thus, in January, the banking sector posted a net profit of UAH 0.36 billion, in February – UAH 3.49 billion and in March – UAH 1.24 billion.
In Q1 2016, the banking system reported a net loss of UAH 8.01 billion.
In Q1 2017, all groups of banks (foreign-owned banks, private banks and state-owned banks) exhibited a profitable performance, with state-owned banks accounting for half of the net profit posted by the banking sector – UAH 3.01 billion. However, the increase in net profit could be offset by higher provisioning against asset operations. Foreign-owned and private banks posted a total net profit of UAH 1.88 billion and UAH 0.2 billion respectively.
“Ukraine’s banking system has delivered a profitable performance for three consecutive months for the first time since the pre-crisis year of 2013. Today we can state that significant shocks of the previous three years are over and the domestic banking system is returning to health. The banking sector's return to profitability will help restore lending to the real sector,” said NBU Deputy Governor Ms Kateryna Rozhkova.
Lower allocations for provisions by banks (UAH 6.33 billion in Q1 2017 versus UAH 11.34 billion in Q1 2016 boosted banks' profitability. In addition, in the first three months of 2017, the banking system posted a 13.3 percent increase in net interest income to UAH 11.57 billion and a 16.8 percent rise in net commission income to UAH 6.62 billion.
Thus, as of 1 April 2017, performance of 72 banks out of 92 solvent banks was profitable with net earnings amounting to UAH 6.87 billion; 20 banks incurred loss for a total amount of UAH 1.78 billion.