NBU: Business lending in Ukraine is growing at its fastest rate in over 15 years

This is stated in the National Bank of Ukraine’s Financial Stability Report.

The NBU notes that the current period of credit expansion is the longest in over 15 years.

Hryvnia-denominated lending to businesses has been growing by around 30 per cent year-on-year for over a year now. Lending to households has been growing at a similar rate for two years running.

Banks are lending more actively to businesses of all sizes. In particular, funding for the defence industry and projects to restore energy infrastructure is on the rise.

According to the National Bank, the number of companies actively using bank loans has doubled over the last ten years.

However, only a third of Ukrainian companies, when assessed by asset size, currently use bank loans.

What risks does the National Bank see?

The regulator believes that this situation indicates both significant potential for the further development of lending and, as yet, limited demand from businesses for bank loans.

That is why the NBU recommends that banks make more active use of market-based financing mechanisms.

These include syndicated lending, factoring and credit guarantees from international financial organisations, rather than state-subsidised programmes.

Loan quality is improving

The National Bank also reports an improvement in the quality of loan portfolios.

As at 1 May 2026, the proportion of non-performing loans had fallen to 12.6 per cent, whilst the default rate on hryvnia-denominated business loans remains below 3 per cent.

This indicates that borrowers are generally meeting their loan obligations more effectively.

Why banks cannot lend more quickly

Despite the positive trend, banks’ profitability is gradually declining.

The NBU attributes this to rising administrative costs, the return of credit risk premiums to pre-war levels, and increased taxation on banks.

It is the tax burden, according to the regulator’s assessment, that limits banks’ ability to accumulate the capital needed for further expansion of lending.

Even if current profitability levels are maintained, banks will not be able to increase their assets by more than 15–20 per cent per year.

Furthermore, the sector’s development is hampered by uncertainty regarding dividend policy and the future privatisation of state-owned banks.

For Ukrainian businesses, this means that banks are increasingly willing to lend to companies, but their capacity is not unlimited.

According to the NBU, further expansion of lending requires not only maintaining the financial stability of banks but also creating conditions under which they can build up capital and provide broader financing for economic development.

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