Non-performing loans decreased slightly in October. According to the statistics of the Bank of Albania, they constituted 5.12%, from 5.24% that had been at the end of September.

The ratio of non-performing loans is also up 0.12% compared to the same period a year ago, when it stood at 5%.

The increase in the ratio of bad loans during this year was expected, but so far this increase has been small and below the expectations of the Bank of Albania.

The high inflation and the increase in interest rates last year are considered to have influenced the deterioration of the indicators this year.

Meanwhile, as far as the exchange rate is concerned, the strengthening of the Lek has partially also had a parallel negative effect, because it has shrunk the value of the foreign currency loan portfolio. The value of the loan portfolio for the economy at the end of October reached 7.2 billion euros, with an annual increase of 1.9%. In the absence of the exchange rate effect, the Bank of Albania calculates that the annual growth would have been around 7%.

In total, the Albanian banking system has more than 360 million euros in loans, which are not paid on time.