The private sector loan portfolio grew by around 14% in the second quarter of the year, compared to the same period a year earlier, reflecting the increase in bank financing for businesses and individuals.

According to data from the Bank of Albania, the expansion of lending has extended to most categories. For businesses, the demand for loans continues to be high, especially for investments, liquidity needs, and expansion of activity.

Banks report that lending standards for businesses have generally remained unchanged, while competition in the banking sector has contributed to the creation of more favorable conditions for borrowers.

An increase in the demand for financing has also been evidenced by small and medium-sized businesses, which are using bank loans more to expand capacities, purchase equipment and develop their activities.

Individuals have also continued to increase their demand for credit, mainly for housing purchases and consumer financing. According to banks, the easing of financing conditions and greater competition in the market have influenced this trend.

Meanwhile, loans in lek are gaining greater weight in the banking portfolio, as financing in the local currency has grown at a faster pace.

The expansion of lending to the private sector is seen as a positive signal for economic activity, as it creates more opportunities for investment and business expansion, while for individuals it supports housing and consumer financing.