How much is owed by farmers of ACC?

Not long ago there was news in the media that the amount of new loans to farmers, provided by JSC "Agrarian Credit Corporation" by the end of the year will reach 350 billion tenge. Subsequently, World of NAN decided to analyze the loan portfolio and find out about the level of delinquency rate of farmers.

The latest available financial statements are for the 3rd quarter (excluding KazAgroFinance). It shows that over the first 9 months ACC increased its gross loan portfolio by 147 billion tenge, well below the 350 billion tenge reported by the results of the year. It may be that ACC clients repaid their loans for a conditional 153 billion and ACC disbursed 300 billion, resulting in a net increase of 147 billion tenge. Besides, the reports separately mention the loans the ACC issues to banks at 1.5% per annum under Ken-Dala program. Last year the volume of such loans did not grow and remains at a typical level for September: about 43-44 billion tenge.

And yet, exactly for the last year, if we compare it with the end of September 2021, the loan portfolio grew by 310 billion tenge. Of them 189 billion were issued to individuals, which gave a threefold growth last year. Meanwhile, the increase in loans to individuals led to a decrease in the quality of the portfolio. The share of overdue loans to individuals rose from 12% to 17%. For legal entities, the share of overdue loans remains at 15%. In general, more than 10% of loans are overdue for more than a year. At the same time the individuals have a large share of overdue loans with the period less than 30 days - 4.3%, while the legal entities have 1.4% of short-term overdue loans. In total the amount of overdue loans is 139 billion tenge while last year this figure was 86 billion tenge.

Then what was the source of money for the growth of the loan portfolio, begs the question. The main source of money is the government. It lent 140 billion tenge (last year 70 billion) to ACC at 0.01% interest rate, repayable in December and the end of March. ACC also received 45 billion tenge in state subsidies in the form of loans. The rate on such loans does not exceed 1% per annum.

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