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Business lending/ Construction and energy decline, trade weight increases

2026-03-11 07:18:21, Ekonomi CNA

Business lending grew again during 2025, but at slower rates compared to the record rates of 2024.

According to statistics from the Bank of Albania, new business loans reached 296 billion lek, up 10% compared to the previous year. For 2024, new loans had increased by 24%.

Trade remains dominant in the structure of credit to the economy and its share increased further last year. Trade credit accounted for almost 37% of the value of new credit disbursed during the year.

The share of trade credit increased further from the previous year's level of 35.6%. In value, new trade credit in 2025 reached 109.2 billion lek, an increase of 14.2% compared to 2024.

Although domestic demand has shown signs of weakness, the increase in the number of foreign tourists seems to have partially offset this effect and has led to tourism-related services, especially trade, having a growing role in the Albanian economy after the pandemic.

The second most-credited sector of the economy last year was construction, with a new loan value of 40.8 billion lek. However, the value of new loans for construction fell by 13% compared to 2023.

The specific weight of new construction loans fell even more sharply, to 13.8%, from 17.5% a year earlier. The decline in construction loans over the past year may be a signal that the growth cycle of this sector that began after the pandemic may have peaked.

In part, the performance of construction credit may have been influenced by annual changes in the financing of large projects mainly related to PPPs in road infrastructure.

The third most credited sector of the economy was the manufacturing industry, with 35.6 billion lek, 29% more compared to the previous year. The specific weight of credit to industry to total credit to business increased to 12.1%, from 10.3% a year earlier.

Despite the fact that industry as a whole and the processing industry in particular have shown poor production performance over the past year, lending in this case seems to have moved in the opposite direction and has recorded strong growth.

Meanwhile, the energy sector in particular saw a significant decline in lending last year.

The loan portfolio in this sector decreased to 13 billion lek, down 46% compared to 2024. This also brought a significant decrease in the weight in the structure of new financing for businesses, to 4.4%, from 9.1% a year earlier.

The transport and warehousing sector again marked an increase in its share in business loans and reached 5.7% of new financing, up from 5% a year earlier.

New financing in this sector reached 19.8 billion lek, 46% more compared to a year earlier.

The hotel and restaurant sector gained increasing weight last year, reflecting the high demand for new investments in this sector. New credit reached 16.4 billion lek, an annual increase of 27.8%. The weight in the business credit structure increased to 5.5%, from 4.8% a year earlier.

The agricultural sector also recorded modest lending last year, with 2.6 billion lek in total, 3% less than the previous year. Agriculture remains significantly under-credited, with 0.9% of loans granted to businesses in 2025.

Credit for agriculture declined, despite the application of various financing facilitation schemes, including a new sovereign loan guarantee scheme, which was applied by the Albanian government in the second half of 2025./Monitor.al