Banks ended September with AZN 915.5 million in non-performing loans. The balance fell AZN 31.3 million during the month, but remained well above its end-2025 level.
September brought an improvement
The CBA September bulletin, Table 5.6 shows non-performing loans falling from AZN 946.8 million to AZN 915.5 million, a 3.3% monthly decline. Their share of bank lending decreased from 2.88% to 2.72%.
Two movements supported the ratio: bad loans declined while the total portfolio expanded from AZN 32.82 billion to AZN 33.68 billion. The lower ratio therefore was not simply the result of a larger denominator.
Still above December
At end-2025, NPLs stood at AZN 762.6 million, or 2.54% of lending. By September their value had risen AZN 152.9 million, roughly 20.1%. One better month has not reversed that increase.
This prudential NPL measure covers outstanding principal on loans with principal or interest more than 90 days overdue. It differs from overdue lending in monetary statistics. Combining those series would produce a misleading comparison.
| Measure | December 2025 | August 2026 | September 2026 |
|---|---|---|---|
| NPLs, AZN million | 762.6 | 946.8 | 915.5 |
| NPL ratio | 2.54% | 2.88% | 2.72% |
| Loan portfolio, AZN billion | 30.06 | 32.82 | 33.68 |
The implication for banks
A smaller NPL balance reduces the amount of lending requiring closer attention. The bulletin does not separate repayments, write-offs and reclassification, however, so the entire decline cannot be attributed to improved borrower finances.
The next monthly readings and provisioning costs will help establish whether the improvement lasts. September was better than August, but the NPL ratio remained above December.
