The NBU revises its forecast for credit losses from 30% to 20% due to the war.

According to National Bank, this year, banks have sharply reduced the formation of reserves after showing significant losses from credit risk last year.

Since the war began, banks have suffered losses of almost 15% of their portfolio that was in operation at the time of the Russian invasion. Losses are somewhat lower for the corporate portfolio and higher for the retail portfolio. At the same time, some of the business loans undergoing restructuring and for which service conditions have been relaxed may become non-performing over time.

“Considering these additional potential losses, the total portfolio losses due to the war will approach the NBU estimates of a year ago, to about 20%“, the bank added. The NBU states that the pessimistic scenario of credit losses assumed in the event of long-term negative consequences from the electricity shortage did not materialize.