Page 78 - RusRPTDec23

• The capital buffer in October remained almost unchanged and stands at approximately 6.9 trillion rubles.
BONDS: The portfolio of debt securities in October remained almost unchanged, with an increase of only 1 billion rubles, which is less than 0.01%.
During October, banks sold a small portfolio of OFZs (Federal Loan Bonds), primarily those with fixed coupon income, on the secondary market, totaling around 60 billion rubles more than they purchased new issuances of OFZs, approximately 64 billion rubles, primarily with floating income.
Overall, the issuance activity of the Russian Ministry of Finance remained low in October, with OFZs placed at around 120 billion rubles, compared to 84 billion rubles in September. Apart from banks, non-bank financial organisations (NFOs) also showed interest in OFZs, purchasing approximately 44% of the total issuance volume for their clients in discretionary management.
Companies continue to replace eurobonds with local securities denominated in US dollars and other "toxic" currencies but allowing settlements in rubles. It is estimated that around 46 billion rubles' worth of ruble-denominated equivalents were placed in October.
CBR LOANS: In October, the volume of government funds significantly increased by 1.3 trillion rubles, marking an 11.2% growth after a 2.6% reduction in September. The primary reason for this increase was substantial tax revenues, particularly from oil and gas companies paying their quarterly tax on additional income in October. As a result, in October, they contributed nearly 1 trillion rubles more to the budget compared to September, totaling 1.6 trillion rubles versus 0.7 trillion rubles (see page 7).
Loans from the Central Bank of Russia experienced more moderate growth, increasing by 345 billion rubles, or 8.1%. Banks mainly secured loans against non-market assets.
8.1.7 Banks specific issues
Russia’s top bank Sberbank expects a significant cooldown of the mortgage market soon, although its mortgage lending will jump by 80% to 4.6 trillion rubles in 2023, CEO German Gref told reporters on November 8 on the sidelines of the Finopolis forum. “We are very likely to see a serious cooldown soon, but 2023 can be still called successful for the Russian mortgage market. Sberbank data shows that mortgage lending amounted to around 3.7 trillion rubles in less than 10 months,” he said. “Our forecasts say that the lending for the entire of 2023 will amount to about 4.6 trillion rubles. This translates into an 80% increase as compared with the previous year. The growth as compared with 2021 will also reach a significant 60%.” The mortgage market is about to cool down to a serious degree, but the year of 2023 will remain successful for the Russian mortgage market, Gref said.
78 RUSSIA Country Report December 2023 www.intellinews.com