Page 97 - RusRPTOct20

8.1.4​ NPLs
Debts of Russians overdue by more than 90 days grew by 5.3% in August to more than RUB1 trillion as of September 1, overshooting a RUB1 trillion ruble threshold for the first time since the end of 2016, ​according to the Central Bank of Russia (CBR), as cited by Prime.
This level of overdue debts was last seen in the midst of almost four years of economic stagnation that followed the collapse of oil prices at the end of 2014 when the banking sector in particularly was making no money at all.
The share of bad debts of individuals also grew by 0.2 percentage points to 5.4% of the total amount of loans, the level of the beginning of 2019.
The combined volume of retail loans went up 1.9% in August to RUB18.8 trillion as of September 1.
Russia’s economy was recovering well in 2019 and the banking sector had returned to profit. This year got off to a good start and banks were expected to extend the gains they had made in 2019, but the sector was knocked sideways by the double whammy of another collapse of oil prices and the coronavirus (COVID-19) epidemic.
However, as bne reported the banking sector has staged a comeback in the last two months and has earned profits in the last months to take the cumulative profits made this year back to the level of last year.
8.1.7 ​Banks specific issues
The Russian government plans to prolong the program of cut-rate, 6.5% mortgages, ​Deputy Prime Minister Marat Khusnullin told reporters on Thursday. The program of reduced-rate mortgage was launched at the end of April and is applicable for loans issued until November 1, 2020. Khusnullin said that the program was very successful and the industry attracted 500 billion rubles. "We plan to prolong it," he said, adding that a final decision will be made closer to November.
The subsidised mortgage programme has been in place since 17 April and has had a strongly positive effect on residential sales during the pandemic-related economic turbulence. In the sales of the publicly listed developers, the share of mortgage sales climbed an average of 10pp from 50% in 2019 to 60% in 1H20. PIK reports the leading contribution of credit sales, at 76%, followed by LSR with 59% and Etalon with 40% (all as of 1H20).
97 ​RUSSIA Country Report​ October 2020 ​ ​www.intellinews.com