Nonperforming loans jump by 84.5 billion MNT

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Mongol Bank held its monthly briefing session on May 29 to detail changes in the financial and banking sectors in April.

Money supply and savings

Mongol Bank representatives reported that out of total money supply, savings accounted for 55.1 percent, tugrug current accounts took up 15.2 percent, current accounts in foreign currency made up 14.2 percent, savings in foreign currency accounted for 12 percent, and money outside of depositories accounted for the remaining 3.2 percent as of April.

The total savings amount reached 13.8 trillion MNT last month, with savings accounts of individuals making up 80.4 percent. It was reported that 19.4 percent of savings of individuals and 25.9 percent of savings of organizations are deposited in foreign currency.

Loans

At the end of April, the amount of outstanding loan to entities, enterprises and individuals amounted to 17.5 trillion MNT, up by 182 billion MNT (1.1 percent) from the previous month and by 3.2 trillion MNT (21.9 percent) from the same period of last year.

On the other hand, the number of new loans issued to individuals increased by 28 percent to stand at 9.1 trillion MNT as the number of new loans issued to private organizations rose by 15 percent, reaching 8.2 billion MNT.

According to Mongol Bank, 15 percent of all loans – 1.6 percent of loans to individuals and 29 percent of loans to private organizations in particular – are conducted in foreign currency. In April, total loans amounted to 17 trillion MNT, of which 14.9 trillion MNT are in local currency and the rest in foreign currency. While loan performing normally rose by 31 billion MNT, or 0.2 percent, from March to April this year, nonperforming loans hiked by 84.5 billion MNT, or 4.5 percent. Loans to private organizations account for 85 percent of all nonperforming loans.

As for overdue loans, 79 percent belonged to organizations.

Mortgage

Out of new mortgage loans worth 66.5 billion MNT issued to 923 people in April, 45.2 percent were financed by the mortgage program and the rest were financed by commercial banks with their own capital. The weighted average interest rate of newly issued mortgages declined by 1.7 percentage points compared to the previous month and by 0.8 percentage points compared to the same period of last year.

Almost a third of outstanding mortgage loans were financed by the program, while 23.6 percent were sourced by commercial banks and 2.1 percent by other financial sources. Program loans accounted for 77.9 percent of mortgage loans issued outside of Ulaanbaatar, those financed by banks accounted for 24.2 percent and 0.82 percent were issued through other financial sources.

Interest rate

The average weighted interest rate of tugrug savings accounts for individuals stood at 11.5 percent by the end of April while the average weighted interest rate of tugrug savings accounts for organizations stood at 10.3 percent.

As for loans, the average weighted interest rate of loans to individuals was 17.9 percent in April and 17.1 percent for loans to organizations.

At present, the average weighted interest rate of tugrug savings accounts for individuals is 11.7 percent and the average weighted interest rate of tugrug savings accounts for organizations 11.1 percent. Loans to individuals have 18 percent average weighted interest rate, while organizational loans have 15.6 percent average weighted interest rate.

Dulguun Bayarsaikhan

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