Page 96 - RusRPTDec21

Balance sheet. Gross customer loans were up 1.6% q/q and 10.0% y/y, while customer accounts were flat q/q – and were only 4.3% higher y/y. The bank’s net LDR was at 97%.
Asset quality. The share of NPLs declined 15bp q/q to 9.9%, while the share of problem loans dropped 65bp q/q to 9.5% amid repayments, write-offs and the sale of problem loans. The coverage ratio of problem loans grew to 87% despite the 77bp q/q CoR decline to 84bp.
Capital position. The bank’s capital adequacy ratios increased q/q: T1 50bp to 13.82% and Total 43bp q/q to 16.46%. N1.0 stayed at 13.2%, leaving room for further capital distribution.
2021-23 Strategy update. Yesterday, BSPB shared an update of its 2021-23 Strategy. The bank targets more than 16% ROE, keeping its focus on developing EXIM operations and the SME business in both Moscow and St Petersburg. However, BSPB increased its CIR target 3pp to 37%, which implies a lower CoR outlook. BSPB’s intention to distribute capital via dividends (more than 20% of IFRS earnings) and share buybacks is intact.
The adjusted net profit of Russian insurer Renaissance Insurance increased by 7% on the year to 3.5bn rubles in January–September, as calculated under International Financial Reporting Standards (IFRS), the company said in a statement on Monday. Gross collection of insurance premiums grew by 27% on the year to 74.4bn rubles in the period due to recovery of demand for insurance services. Collection of premiums on contracts other than life insurance grew by 21% to 32.9bn rubles. Premiums in the car insurance segment rose by 32% in the period as sales of new cars gained 15%, while premiums in voluntary medical insurance increased by 15% to 5.8bn rubles.
8.2 Central Bank policy rate
The CBR hiked rates to 7.5% in September but warned that inflation remains high and investors are watching the December 17 meeting closely, expecting more hikes.
In its monthly policy report the CBR said: “Inflation had been evolving significantly above the Bank of Russia’s July forecast. Price growth has accelerated since the second half of August largely driven by temporary factors. A more modest harvest of vegetables and growing livestock costs are behind a considerable acceleration in food inflation.
Core inflation indicators remain markedly above the target. This reflects a strong imbalance between the level of aggregate demand and output expansion capacity.
High inflation expectations are further fuelling current demand. After a decline
96 RUSSIA Country Report December 2021 www.intellinews.com