Kyrgyzstan’s credit portfolio hit by 25.2 billion soms in 2009

Kyrgyzstan’s credit portfolio increased by 25.2 billion soms in 2009, that is 1.5 percent less than in 2008. These data are listed in the Prime-Minister’s annual report for 2009.

According to the report, the basic reasons for reduction of credit portfolio are slackening in the rate of economic growth as whole, increased risks due to unstable financial condition of borrowers of banks that served for commercial banks as a reason for “cautious” crediting, as well as increase of interest rates for credits. Thus, average interest rates on newly issued credits in 2009 amounted in national currency to 26.7 percent, in foreign – to 21.5 percent, the document says.

As noted in the report, the financial crisis primarily complicated the attraction of new credits in the banking system. The most tangled situation is observed in enterprises. Issuing of credits to the economic entities reduced by 1.3 times. The rate of unprofitable enterprises in KR amounted to 44 percent in 2009, illustrating the lack of current assets for expansion of production.