The National Bank of Ukraine has published its Q1 Banking Sector Review, showing that net hryvnia lending to businesses and households accelerated from the previous quarter and was growing at close to one-third year on year. Banks’ net assets were up 16.2% year on year, supported by nearly two years of loan growth, while the non-performing loan ratio fell to 12.9% as legacy bad loans were written off and new lending remained high quality. Sector profitability weakened, with net profit down by one-third in Q1 because of the 50% income tax rate, but all solvent banks remained compliant with capital adequacy requirements at quarter end. Corporate hryvnia lending was driven mainly by loans to private corporations, with the fastest growth at private and foreign banks, in maturities above three years, and in trade, machine building, mainly the defense industrial base, and construction. Household lending growth picked up on unsecured loans, while mortgage and car loan growth slowed. Banks also continued to increase holdings of domestic government debt securities as certificates of deposit fell 26.1% quarter on quarter. On pricing, the average rate on new household hryvnia deposits declined to 10.1% per annum overall and 12.2% for term deposits, while hryvnia business loan rates fell to 15.1%, with private banks with foreign capital offering the lowest average rate at 13.3%. The review notes that net loan data gives a clearer picture of lending dynamics because gross figures were affected by large legacy NPL write-offs by state-owned banks in December 2025. The review indicates that further lending growth is expected to be supported by measures under the updated lending development and mortgage development strategies.
National Bank of Ukraine2026-05-25
National Bank of Ukraine reports faster hryvnia loan growth in Q1 and NPL ratio down to 12.9%
The National Bank of Ukraine’s Q1 Banking Sector Review reports strong net hryvnia lending growth to businesses and households, with banks’ net assets up 16.2% year on year and the non-performing loan ratio down to 12.9%. Sector profitability declined as net profit fell by one-third due to the 50% income tax rate, though all solvent banks met capital adequacy requirements. The review notes continued growth in corporate and unsecured household lending, increased holdings of domestic government debt securities, lower deposit and loan rates, and expects further lending growth.