NPL stands at its lowest in almost five years

  • ECO News
  • 12 September 2017

Portuguese banks had a 15,392 million euros' portfolio of non performing loans in July - the smallest amount since December 2012. This decrease was a result of the cut back in companies' NPLs.

The amount of non performing loans (NPLs) held by the Portuguese banking decreased to a new minimum. Data disclosed this Tuesday by the Bank of Portugal shows that in the end of July, those types of loans went up to 15,392 million euros. This is the smallest amount in almost five years.

We would need to go back to December of 2012 to see a smaller level of NPL, a period in which it stood at 15,053 million euros. The weight of NPL in the overall amount of loans also fell, but to minimums of June, 2014. In July of this year, NPL represented 8.1% of the 190,041 million euros in loans.

Companies are responsible for most part of this decrease in NPL. In July, companies had 10,533 million euros in non performing loans, 85 million euros less than in the previous month. As a result of that decrease, the weight of NPL shrunk to 14.04% — the lowest amount since September of 2014.

Private individuals, on the contrary, registered an increase of NPL. These loans had a 28 million euros’ increase in July, so families had a total of 4,859 million euros of NPL — 4.225% of the total amount of financing granted to families.

Among privates, housing continues to present the largest volume of NPL: there are 2,000 million euros of NPL, in line with June’s 2,001 million euros. Out of all the money granted by banks for the purchase of houses, 2.24% concerns non performing loans, the lowest amount since September 2013.

In consumption, NPL ascended to 708 million euros, more than the 702 million euros from June — which equals 5.53% of all that financing. As for other purposes, the total was 2,051 million, more than the 2,028 registered in June. Consumer credit includes, therefore, 56.8% of non performing loans.