Page 69 - bne IntelliNews monthly country report Russia February 2024

As of early November, problematic corporate loans were covered by individual reserves at 78%, and overall reserves at 124% (compared to 77% and 123% at the beginning of October). In retail, the coverage stood at 92% with individual reserves and 136% with overall reserves, up from 91% and 134% at the start of October, respectively.
8.1.5 Liquidity, NIMs & CARs
LIQUIDITY: The reserve of liquid ruble assets, including cash, claims on the Bank of Russia, and unencumbered market collateral, increased by 1.6 trillion rubles.
Banks secured loans from the Bank of Russia using non-market assets (+0.7 trillion rubles) within the primary mechanism for liquidity acquisition. Additionally, the Lombard list was expanded at the end of November (+0.4 trillion rubles). In total, this led to a growth in market collateral by 1.1 trillion rubles and an increase in claims on the Bank of Russia by 0.4 trillion rubles.
The overall volume of ruble liquid assets reached approximately 16.8 trillion rubles. The coverage level for all client funds is close to a comfortable 20% (+1.5 percentage points from 18.5% in October). The coverage level for individual funds increased to 44% from 41%.
The growth in liquid assets predictably resulted in a reduction in the share of banks (by assets) with a coverage of client funds below 20% (to approximately 70% from 80%). The volume of liquid assets needed to increase coverage to 20% also decreased to 4.3 trillion from 6.0 trillion rubles, with these banks able to secure most of the shortfall using non-market assets.
The reserve of foreign currency liquidity experienced a slight reduction, decreasing to 48.9 billion F from 51.4 billion US dollars. This shift occurred amid the preemptive growth of foreign currency lending compared to client funds. The decrease was primarily observed in the area of interbank loans provided to non-resident banks.
Coverage of client funds also saw a slight decline, down to approximately 52% from 54%. Similarly, coverage of foreign currency obligations decreased to 27% from 29%.
CAPITAL: The sector's balance capital increased by 274 billion rubles, reaching 14.1 trillion rubles, driven by a profit of 268 billion rubles.
According to preliminary data, in November, the Common Equity Tier 1 (CET1) capital adequacy ratio (CAR) grew by 0.13 percentage points to 12.15%, attributed to the advanced growth of capital (2.2%) compared to risk-weighted assets (1.1%).
The regulatory capital growth in November resulted from the monthly profit.
The growth of risk-weighted assets (RWA) was primarily fueled by the expansion of the loan portfolio and the continued increase in macro-additions
69 RUSSIA Country Report February 2024 www.intellinews.com