Weak economy to blame for increase in bad loans, jump in bad credit indices

Almost every fifth loan granted by national banks in Poland today is in serious danger of not being paid back. This is mainly due to the poor economic situation, economic analysts and bankers judge. The volume of bad loans went up by 2.6% last year while their share of the credit portfolio increased from around 15% at the end of 2000 to nearly 18% by the end of last year, according to data released by the National Bank of Poland (NBP) and the Foundation for Education and Banking Research (FEiBB). The so-called indices of bad credit of the first and second degree, which reflect borrowers' repayment situations, rose significantly. The former went up from 9.5% to nearly 12%, while the latter rose from 3.8% to 5.6%. According to bankers, particularly alarming is the quickly rising level of lost loans, which exceeded 8% in the fourth quarter of last year. (Prawo i Gospodarka, p. 1) A.K.