Bad loans are decreasing. By the end of December 2024, they accounted for 4.17% of the total loan portfolio, marking the lowest level in the past 10 years. In November, the rate stood at 4.48%, while in 2023, bad loans made up 5% of the total.

According to data from the Bank of Albania, the quality of the loan portfolio improved at the beginning of 2024 and continued to do so in the second half of the year, defying initial expectations that inflation and interest rates would increase the level of problematic loans.

The progress in resolving this issue is also attributed to banks, which have exercised greater caution in loan approvals in recent years.

Additionally, there has been a shift in the behavior of businesses and individuals, who have increasingly opted for the Albanian lek.

Observing the exchange rate trends, which have depreciated the value of foreign currencies, the tendency to take loans in euros or dollars has declined.