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for the month. However, the situation across banks remains varied.
Some banks declared dividends totaling 59 billion roubles and recorded a negative revaluation of securities amounting to -50 billion roubles. This was due to the ongoing rise in yields on Russian government bonds (OFZs), with average monthly yields increasing by 15–100 basis points. On a sectoral level, these factors were partially offset by the recapitalization of certain banks, amounting to approximately 76 billion roubles, and the positive revaluation of perpetual subordinated loans (+24 billion roubles) resulting from the appreciation of the rouble.
While data for June is pending, in May, the capital adequacy ratio (N1.0) of the sector decreased to 11.9%, a decline of 0.27 percentage points for the month. This reduction was due to a 0.3% decrease in total capital amid a simultaneous increase in risk-weighted assets (RWA) by 2.2%. This decline in capital adequacy highlights ongoing challenges in maintaining robust capital buffers amid fluctuating market conditions and regulatory requirements. Further details on the May data are available in previous reports.
8.1.1 Earnings
The Russian banking sector's net profit, adjusted for the redistribution of income within banking groups, amounted to 225 billion roubles in June, a decrease of 30 billion roubles, or 12%, from May's adjusted figure of 255 billion roubles. This decline brought the sector's return on equity (ROE) down to
152 RUSSIA Country Report August 2024 www.intellinews.com