In the first quarter of 2023, total assets of credit institutions were down 5.2% from the end of 2022 and stood at EUR 72.0bn. Assets decreased in most credit institutions.
Total loans and advances fell (7.0%) more than non-performing loans (NPLs, 2.2%), with the result that the share of NPLs in total loans and advances rose from 3.0% at the end of 2022 to 3.2% at the end of the first quarter of 2023. The fall in total deposits with the central bank influenced the fall in total loans and advances. NPLs fell in the portfolio of loans to non-financial corporations where their share in loans dropped from 6.4% to 6.2%. The fall in the amount of NPLs was also seen in the portfolio of household loans, with their share falling from 5.0% to 4.8% of loans to that sector.
The operations of credit institutions generated EUR 301.2m in profit in the first quarter of 2023. Profitability indicators rose from the end of 2022. The return on assets (ROA) thus rose from 1.0% to 1.6% and return on equity (ROE) rose from 8.2% to 14.0%.
The key indicators of banking system capitalisation remained high, with the banking system total capital ratio standing at 23.6%. All credit institutions boasted total capital ratios in excess of the minimum prescribed of 8%.
Credit institutions' liquidity measured by the liquidity coverage ratio (LCR) also remained very high. At the end of the first quarter of 2023, all credit institutions met the prescribed minimum liquidity requirements, with the average LCR standing at 226.2%.