Banking sector performance during the COVID-19 crisis in the Republic of North Macedonia

Georgieva Svrtinov, Vesna and Miteva-Kacarski, Emilija and Paceskoski, Vlatko (2021) Banking sector performance during the COVID-19 crisis in the Republic of North Macedonia. Journal of Economics, Special Issue. pp. 221-230. ISSN 1857-9973

Text (Banking sector performance during the COVID-19 crisis in the Republic of North Macedonia) Banking sector performance during the COVID-19 crisis in the Republic of North Macedonia.pdf - Published Version Download (489kB)

Abstract

This paper explores the effect of the COVID-19 crisis on commercial banks in the Republic of North Macedonia. It has used data from financial statements of the banks in
order to find out if there are changes in banks profitability, as well as banks exposure on liquidity and credit risk in the period of Corona crises and before the crises.
Furthermore, we explore if there are changes in the credit and deposit potential of banks and whether there are an increase in non-performing loans. We conclude that even the banking sector has faced several challenges, it maintained its stability and contributed to mitigation of the consequences of the corona crisis. This, on the one hand, is a result of public confidence in the banking system, but, on the other hand is due to the rapid
reaction of the National Bank of Republic of North Macedonia. In 2020, the banking system made a higher profit compared to the previous year. Net interest income was the most significant in the structure of total income and did not decrease in 2020 compared to 2019. Banks ensured solid growth of loans and deposits as well as properly managed their credit and liquidity risk. It is important to emphasize that banks have maintained a stable and solid liquidity position, which is one of the main pillars of the stability of the banking system, especially important in times of crisis. There was also no increase in credit risk, on the contrary there was a decrease in the percentage of non-performing loans. This is primarily due to regulatory measures taken by the National Bank in the field of credit risk management and the introduction of the possibility of temporary deferral of loans.
Key words: bank profitability, banking system in the Republic of North Macedonia, COVID-19 pandemic, credit risk, liquidity risk, non-performing loans

Item Type:	Article
Subjects:	Social Sciences > Economics and business
Divisions:	Faculty of Economics
Depositing User:	Emilija Miteva
Date Deposited:	25 Aug 2021 10:32
Last Modified:	25 Aug 2021 10:32
URI:	https://eprints.ugd.edu.mk/id/eprint/28359

Actions (login required)

View Item