Second-tier banks in Albania write off lost loans worth 50 million USD: Cbank

For the first eight months of the year, the value of loans written off from the balance sheets of second-tier banks in Albania amounted to 6.3 billion leks (50 million U.S. dollars), Bank of Albania experts announced Tuesday.

The Bank of Albania estimates that the amount of loans that the banks need to write off from their balance sheets is still high, but it expects that in the last month of the year, there would be an accelerated clearance of loan loss from the balance sheets, local media here cited Cbank report.

The reduction of the value of write-off loans is related to a partial depletion of this process because the majority of lost loans were deleted last year, experts said.

However, according to them, the writing-off of the lost loans has been insufficient in reducing the level of bad loans this year.

Generally, this process is more concentrated in the last months of the year, before the banks close their annual balance sheets, they said.

According to the regulatory changes approved by the Bank of Albania last year, banks have to write off from their balances the loans that were classified as lost loans for more than three years.

According to the bank, in 2015, banks operating in Albania wrote off about 27 billion leks as lost loans. (1 U.S. dollar = 128 Albanian leks) Endit