Montenegro’s banks recorded substantial growth in lending during the first five months of 2026 while aggregate profitability declined compared with a year earlier. Total bank loans reached €5.77 billion in May, representing an increase of 12.3% year on year. Net banking profit, meanwhile, stood at €55.29 million, down 12.4% from May 2025.
Credit expansion was recorded across both corporate and household lending. Loans to companies increased 14.9% to €2.03 billion, while household loans rose 18.6% to €2.55 billion. The figures show that the decline in aggregate banking profit occurred alongside an increase in the amount of credit extended to the economy and households.
The available Ministry report does not identify the factors behind the lower profitability. It does not provide detailed figures on interest margins, impairment costs, operating expenses or fee income, leaving the specific drivers of the profit decline outside the information provided. Bank lending growth is taking place as other sources of economic financing have weakened. Net foreign direct investment declined during the first four months of 2026, while merchandise exports fell during January-May.
With corporate and household borrowing both expanding, domestic bank credit represents an increasing part of the financial activity recorded in the wider economy. The lending figures also show different rates of expansion between the two main borrower groups, with household credit growing faster than corporate lending. Total loans nevertheless increased by more than 12% while banks’ net profit was lower than a year earlier.
