KYIV, Reuters – Ukraine’s banking system suffered a net loss ($7.5 billion) of $733.3 million in January-April. That is an increase from $0.16 billion hryvnias that was recorded in January March.

To cover future losses due to war, the banks were required to transfer additional 11.2 million hryvnias to their reserves in April. Banks transferred almost 15.8 billion Hryvnias to reserve in March.

Russia’s February 24 invasion has caused havoc in business, made it difficult for many individuals and companies to service their loans and resulted in the first loss of bank accounts since 2017.

The central bank stated that the rate of return on assets in the banking sector – an indicator for profitability – has declined to minus 11% from minus 0.03 as of March.

According to the central banking, the conflict could result in Ukraine’s economic contraction by at least one third of its GDP by 2022. It also increase inflation to more than 20%.

($1 = 29.2500 hryvnias)