BANKING SECTOR REVIEW: 4th quarter of year 2022

Crepuscular rays

The indicators of the banking sector were relatively stable and growing. The banking sector’s total assets increased by 1 percent compared to last year’s period. Non-performing loans are expected to increase. Due to the uncertainty of the external environment, citizens have a high interest in saving and keeping foreign currency, which has contributed to the decrease in MNT deposits.

Supply and logistics difficulties due to the Russia-Ukraine issue and the situation of the pandemic affect the prices of the main products of Mongolia. They are the main reasons for the high inflation rate.

Also, the slow recovery of the mining and transportation sectors has a negative impact on economic growth. Still, the relatively fast recovery of the services, trade, construction, and agriculture sectors had a significant impact on the economy growing by 3.7 percent.

Loan growth in the banking sector, which has been the sole supporter of economic sectors during the pandemic, continues. It has been seen that the economy will not be able to grow steadily if the difficulties of transport and logistics are not solved step by step and the recovery of the mining and transport industry is not supported.

The balance of payments deficit not only puts pressure on foreign exchange reserves but also has a high risk of reducing the purchasing power of MNT.

The depreciation of the MNT, the instability of inflation, and the high balance of payments deficit will be an obstacle to the sustainable and accessible growth of the economy in the future. However, Oyu Tolgoi’s underground project, railway construction, and China’s loosening of its strict policy against Covid-19 have brought “Crepuscular rays” to our country’s economy.


  • The amount of loans provided by banks to citizens has increased. The trade sector loan drives the loan growth.
  • The loan quality of banks is at a normal level.
  • The gradual recovery of transport and logistics activities has played an important role in the growth of the construction and manufacturing sector.
  • The financial performance of 5 systemically influential banks has increased.
  • Two systemically influential banks have successfully issued IPO.
  • The uncertain situation all around the world due to the pandemic and geopolitics has been the main cause of higher prices of imported goods and services.

Please click Here to see the full version of the review in ENG.

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