THE LENDING SYSTEM IN COMMERCIAL BANKS AND THE CAUSES OF NON-PERFORMING LOANS

Abstract

The rapid growth of the country's economy is ensured by the mobilization of all available opportunities and
the consistent continuation of the strategy of reforms that have paid off. In particular, in recent years, as a result of
the implementation of consistent and targeted measures aimed at further strengthening the capitalization, liquidity and
resource base of banks, as well as further increasing their investment activity, the weight of banks' assets has been
increasing year by year. Due to the increase in the volume of loans granted by banks of our republic to legal entities and
individuals, and the fact that bank loans constitute the main part of bank assets, the presence of problem loans in the
loan portfolio of banks is becoming noticeable. It has a negative impact on ensuring the stability of the country's banking
system, that is, the circulation of bank funds, and the timely fulfillment of bank obligations to its clients. Losses from
problem loans are not only reflected in losses directly related to the return of loans and non-payment of interest