In the first half of 2024, total assets of credit institutions decreased by 0.6% from the end of 2023 and stood at EUR 78.1bn. Assets decreased in most credit institutions.
Total loans and advances practically stagnated in comparison with the end of 2023 (increased by 0.1%). Loans continued to increase, especially loans to other credit institutions and households. However, this was set off by the decrease in assets with the central bank and other demand deposits. Non-performing loans and advances (hereinafter referred to as ‘NPLs’) declined by 1.9%, primarily those in the portfolio of loans to non-financial corporations.
The share of NPLs in total loans and advances at the end of the first half of 2024 did not change much from the end of 2023 and stood at 2.6%. However, the quality of loans to the two most important institutional sectors continued to improve: the share of NPLs of non-financial corporations decreased from 5.1% to 4.7% and of households from 4.2% to 4.0%.
The operations of credit institutions generated EUR 806.8m in profit in the first half of 2024. Profitability indicators rose from the end of 2023. The return on assets (ROA) thus rose from 1.8% to 2.1% and return on equity (ROE) rose from 15.5% to 18.2%, driven by an increase in interest income, with a large contribution coming from income from overnight deposits with the CNB, as well as the increase from other sectors.
The key indicators of banking system capitalisation remained high and the total capital ratio of the banking system declined to 22.9%, influenced by heightened risk exposure. All credit institutions had total capital ratios in excess of the prescribed minimum of 8%.
Banking system liquidity measured by the liquidity coverage ratio (LCR) was also very high. At the end of the first half of 2024, all credit institutions met the prescribed minimum liquidity requirements, and the average LCR stood at 220.2%.