Assets of insurers and pawnshops continued to grow in Q3, while those of finance companies stabilized after falling in the previous quarter. Credit unions increased volumes of consumer lending. The volumes of lending, factoring, and leasing rose markedly. This is according to the latest Non-bank Financial Sector Review.
The decline in the number of non-bank financial service providers slowed, while total assets increased compared to the previous quarter. However, the share of NBU-supervised non-bank financial institutions (NBFIs) in the financial sector’s assets remained at its all-time low of 8.9%.
Insurers
Insurers’ assets increased the most. Non-life insurers’ assets rose by 10% quarter-on-quarter (qoq) and by 31% year-on-year (yoy), while life insurers’ assets grew by 3% qoq and 15% yoy.
The main drivers of growth in premiums for non-life insurers (up by 9% qoq and 39% yoy) were transport insurance and health insurance; for life insurers (up by 12% qoq and 6% yoy), these were endowment life insurance products.
All insurers complied with the solvency capital requirement (SCR) and the minimum capital requirement (MCR), meaning that they adapted fully to the new requirements.
Credit Unions
The number of credit unions and their assets continued to decrease, primarily due to the revocation of licenses from violators of required ratios. Ten largest credit unions accounted for 61% of the segment’s assets.
Volumes of new consumer lending increased, whereas lending to entrepreneurs decreased. The share of loan principal payments past due for more than 90 days declined to 25%.
All credit unions complied with the required regulatory capital adequacy ratio (N1). Only one union did not have an adequate liquidity cushion.
Finance Companies and Pawnshops
Finance companies’ assets somewhat increased in Q3 after a significant decline a quarter ago. New loans to businesses have reached their highest level since the start of the full-scale war, and in the retail segment, new loans have been consistently high for five consecutive quarters.
The volumes of classical factoring – financing accounts receivable – rose for the fourth consecutive quarter.
Pawnshops increased their asset volumes, in particular new loans against collateral, as well as their profits.
Only one finance company, which was in the process of merging with another, did not comply with the minimum equity requirement.
Prospects and Risks
From January 2026, insurers will form technical provisions in line with an updated methodology, and finance companies will have to meet revised prudential requirements. Significant companies, the list of which will be published by February 2026, will also be subject to additional requirements with a transition period lasting until July.
The Non-bank Financial Sector Review is a report that was first published by the NBU in October 2020. It focuses on the activities of NBU-regulated non-bank financial institutions: insurers, credit unions, finance companies, and pawnshops. The review highlights key developments in the non-bank financial market and provides comprehensive insights into its performance.