Page 103 - RusRPTApr24

That said, in unsecured consumer lending the share of nonperforming loans has fallen slightly - to 7.8% from 7.9%, while in mortgage lending, according to preliminary figures, it remained at 0.6%, according to files provided by the regulator.
Preliminary data indicates that the housing market experienced a slight uptick in February, with a growth rate of 0.7% compared to 0.6% in January. This overall trajectory aligns with expectations for a cooling market, projected to fall within the range of 7% to 12% throughout 2024.
Approximately 330 billion rubles' worth of mortgages were issued during the month, marking a 20% increase from January's 272 billion rubles. Such fluctuations are typical, as January tends to lag due to extended holiday periods.
Both subsidized and conventional mortgage lending saw an uptick, rising by approximately 15% and 40% respectively. However, it's essential to note that the significant surge in conventional mortgage issuance is primarily attributed to a lower base in January. Nevertheless, the tightening of conditions for mass subsidized mortgages since late 2023, including an increase in the initial down payment to 30% and a reduction in the maximum loan size to 6 million rubles, may have contributed to some borrowers shifting towards conventional market programs.
In absolute terms, the increase in both conventional and subsidized mortgage issuance was comparable, totaling around 30 billion rubles.
These developments suggest a housing market that is adjusting to seasonal patterns and regulatory changes, with February's performance offering insights into ongoing trends and consumer behavior.
According to preliminary data, consumer credit growth remained unchanged in February, holding steady at January levels (+0.9%) against a backdrop of increased consumer activity.
This figure currently surpasses our forecast range for the year, which was projected to fall between 3% and 8%. Preliminary analysis suggests that these changes are largely driven by credit card usage, where interest rates have historically remained relatively high and thus less sensitive to fluctuations in market rates.
Nevertheless, we anticipate that lending will face some restraint due to Monetary Policy Measures (MPMs) [see figure below], which are expected to exert a dampening effect on credit extension.
The stability in consumer credit growth amidst heightened economic activity underscores the resilience of the market, although vigilance remains crucial as regulatory measures may influence lending dynamics in the coming months.
103 RUSSIA Country Report April 2024 www.intellinews.com