Annual profits increased markedly despite a decline in November.
The net profit of solvent banks for January-November 2023 reached UAH 130.55 billion, while for the same period in 2022 this figure was 6.7 times lower and amounted to only UAH 19.43 billion.
According to the National Bank's data, in November net profit decreased to UAH 7.85 billion from UAH 12.85 billion in October; this year it was lower only in January, while banks also finished November last year with the best figure - 8.45 billion UAH
The decrease in profit compared to previous months is explained, in particular, by an increase in contributions to reserves last month to UAH 3.75 billion, which is a record figure for this year, while in the previous two months reserves were even dissolved in the amount of up to UAH 1 billion.
According to the NBU, the total income of financial institutions for 11 months increased by 25.7% compared to the same period last year, including net interest income increased by 34.5% - to UAH 182.22 billion, while net commission income - by 2. 5%, up to 45.6 billion UAH.
At the end of 10 months, the growth rate was higher: total income increased by 27.3%, net interest income increased by 36.5% - to UAH 164.24 billion, and net commission income - by 3.8%, to 41.4 billion UAH
This is due to the fact that in November of this year compared to November last year, the growth of total bank income slowed to 12.3% or UAH 39.47 billion, including net interest income increased by 18.3% - to UAH 17.98 billion , while net commission even decreased by 8.6% – to UAH 4.23 billion.
The share of banks' interest income in the overall structure in November remained at the October level - 68.1%, while in November last year it was at 60.2%.
The share of commissions at the end of last month also did not change - 21.7%, while a year ago it was higher - 23.7%.
The share of receipts from foreign exchange transactions increased in November by 0.1 percentage points. - up to 7.1%, while for the same period last year it reached 13.1%.
It is noted that banks paid UAH 26.17 billion in income tax over the 11 months of this year, including UAH 4.13 billion in November.
“Consequently, banks remain highly profitable and operationally efficient: The basis of this profitability in 2023 is significant interest income received primarily due to risk-free investments in government securities (government bonds and certificates of deposit) and moderate contributions to reserves,” added the chairman of the Supreme Court committee Raised on issues of finance, tax and customs policy Daniil Getmantsev.
He noted that, according to the NBU, the net interest margin of banks for 10 months amounted to 8% (compared to 7% and 6% for the same periods of the previous two years, respectively). And the return on capital of the banking system (net profit to equity) for 11 months of this year is 52.8% (versus 9.3% for 11 months of 2022, 32.9% for the same period in 2021).
