The expert Galina Zhukova

Will the quantity of problem banks and "bad" loans increase in 2010?

I think the quantity of problem banks will grow. The matter is that not all the problems acquired by banks during active crediting process, are revealed and eliminated. The list will replenish due to those banks, whose shareholders cannot give a financial support to its "daughters" in such uneasy economic conditions. Despite all large foreign investors will be support Ukrainian banks in future though it is rather hard to tell in what quantity. For example, Kredi Agrikol supported “INDEKSBANK” and continues doing it. In second half of 2009 we have received 300 million UAH for capital reequipment, and the plan of financial support for 2010 is now discussed.

Growth of the problem loan debts acquired during active crediting process should be slowed down. The most part of these problems was showed during 2009, and the basic share of resources is already formed. But it is true only for those banks which fairly showed the problem loan debts and conservatively approached to a question of creation of provisions. For them the main period of bad loans and creation of provisions will end in 2009. At the same time the banks, continuing to loan in 2009, adhere to very cautious policy, therefore their loan portfolios increase qualitatively. It is reasonable to suppose that the loans which have been made by banks in 2009, will not pass into the problem category neither in 2010, nor next years.