Net profit of Andorran banks in 2015 decreased by 8% compared to 2015 year and estimated at 168 million euros

abaNet profit of Andorran banks in 2015 decreased by 8% compared to 2015 year and estimated at 168 million euros.

It was reported by General director of the Association of Andorran banks (ABA, AFA) Esther Puigcercós during the presentation of results of activities of the banks of Andorra (Pyrenees) in 2015.

According to her, these results are still preliminary: “We continue a process of audit of all banks, and the final data will be known only after its approval by the Board of Directors of each bank”.

One of the main reasons of the profit decrease Esther Puigcercós calls the cause of low interest rates, acting within the framework of the European Union, and the inability of Andorran banks to compete with them. At the same time, Esther Puigcercós does not consider the negative situation in the financial sector of the country to be provoked by the scandal with Banca Privada d’Andorra.

Despite the drop in profits, banks noted the increase in gross income (643 million euros), up by 5.7% compared with 2014. In addition, in 2015, the banks recorded an increase of funds by 2.3% compared with 2014. According to Esther Puigcercós, the funds of 4 banks reached 44.982 million euros in 2014, which is 1.017 million more than in 2014.

An increase of the number of deposits (mainly off-balance sheet) was also recorded in 2015 (11.178 million euros, which is 3.5% more than in 2014).

The capital adequacy ratio of the banks of Andorra in 2015 amounted to 21.85%, which exceeds 10 basis points indicator of 2014. By Andorran legislation, banks must demonstrate this indicator at the level not less than 10%.

In 2015 the liquidity ratio is estimated at 71.17%, which is more than the indicator of 2014 by 300 basis points and is significantly higher the required standards.

Commenting the accession of Andorra to the agreement on automatic tax information exchange in 2018 with EU, Esther Puigcercós reported that Andorran banks were ready and had already started adaptation process.

See also Andorra business guide

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