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MIL OSI Translation. Region: Russian Federation –

Source: Central Bank of Russia – Central Bank of Russia –

The corporate portfolio increased by 1.8% in December, and overall growth for 2023 was a record 20.1%. Major business purchase transactions were financed, and financing for housing construction increased. In addition, the replacement of external debt continued, and companies also continued to have a high need for borrowed funds to finance current activities.

In December, the mortgage growth rate remained high (2.9%, taking into account securitization). The annual growth reached almost 35% – this is 1.7 times higher than the result of 2022 (20.4%). Mortgage growth was stimulated by available subsidized programs with increased demand due to elevated inflation expectations.

The effect of macroprudential restrictions and higher rates led to a reduction in consumer lending in December by 0.1%. However, for the year the increase was a relatively high 15.7% after the low results of the crisis year 2022 (2.7%).

The population’s funds in banks increased by 6.9%, which was caused by the traditional advance of January pensions and the payment of annual bonuses. At the end of the year, the increase was 19.7% due to significant social and budget payments, increased salaries and high deposit rates after the Bank of Russia increased the key rate.

In December, the net profit of banks decreased sharply (to 64 billion rubles excluding dividends paid within the banking group), which is associated with an increase in expenses for reserves and operating expenses. However, taking into account significant profits in previous months, the banking sector earned 3.3 trillion rubles over the year. But this result must be assessed in the context of modest profits in 2022 (about 0.2 trillion rubles).

Read more in the information and analytical material “On the development of the banking sector of the Russian Federation in December 2023”.

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Note; This information is raw content directly from the source of the information. This is exactly what the source states and does not reflect the position of MIL-OSI or its clients.

Please note; This information is raw content directly from the information source. It is accurate to what the source is stating and does not reflect the position of MIL-OSI or its clients.

EDITOR’S NOTE: This article is a translation. Apologies should the grammar and or sentence structure not be perfect.

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