Albanian banks' profits fell by 8.8 percent in the first half of the year compared to the same period last year as falling interest rates are putting an end to the golden period of the past three years.
Official data from the Albanian Banking Association shows that in the first half of the year, the total profit of 11 Albanian banks amounted to 17.7 billion lek or 182 million euros, down from 199 million euros for the same period last year (1 euro = 97 lek).
According to the data, the decline in profits has affected almost all banks, with the exception of the American Investment Bank. ABI Bank's profit for the 6 months increased to 21.7 million euros from 15.8 million euros in the first 6 months of 2024, expanding by about 37 percent in annual terms.
The American Investment Bank, or Abi Bank as it is otherwise known, is focused primarily on lending to businesses. About 87 percent of the bank's loan portfolio is for businesses, particularly in the construction and tourism sectors, including large concession projects, a strategy that appears to be paying off this time around.
Meanwhile, as for other banks, OTP Bank and Tirana Bank have maintained last year's financial results with a slight decrease in profit, while the profit of the country's largest bank, BKT, marked a decline of almost 18 percent, dropping to 39.7 million euros in the first half of the year.
However, despite the decline recorded in the first half of the year, Albanian banks' profits remain at relatively high levels, a trend that began after the increase in interest rates brought about by the global inflationary wave of 2022.
Editorial
