According to the latest available statistics, in October 2021 the NPL ratio fell to 3.52%, the lowest level in 2021 and in the last decade, after hovering around 3.9% of total loans in the spring months of 2021. Basically, the NPL ratio fell in October to its lowest level since 2009, when signs of the global financial crisis were being felt in the local market. By comparison, in 2014 the NPL ratio was above 20% of total loans.
The highest level of the NPL ratio in the first half of 2021, 3.98%, was recorded in February. The NPL ratio fell in the second half of 2021 below the December 2020 level of 3.83%, as well as below the summer 2020 values of around 4%.
Looking back at the trend of the last few years, we can see that the banking system ended 2020 with an NPL ratio of 3.83% of total loans, below the end of 2019 level of 4.09%, while at the end of 2018 the NPL ratio was 4.96%, according to NBR statistics.
In 2018, the NPL ratio fell below the 6% threshold in May and below 5% in November, continuing the adjustment of previous years. The downward trend in the NPL ratio came after one in five loans fell into the non-performing category during the previous economic crisis in 2008/2009, becoming a major problem for the banking system.
(English version by Loredana Fratila-Cristescu)