Page 84 - RusRPTOct23

billion rubles in July). This growth was fueled by the weakening of the ruble, which depreciated by 5% in August and 4% in July, along with several banks maintaining long foreign currency positions. However, the core profit in August remained nearly unchanged at 225 billion rubles, representing a marginal 1% decrease.
The number of profitable banks remained largely stable compared to July, with 263 banks, accounting for 81% of the total, staying profitable (as opposed to 265 banks, or 82%, in July). Over the course of the first eight months of 2023, there were 276 such banks (85% of the total), contributing to 99% of the sector's assets.
Despite the sector's profit of 353 billion rubles, the balance capital increased by 223 billion rubles, reaching 13.4 trillion rubles. The main factors contributing to this difference were the negative revaluation of securities assessed at fair value through other comprehensive income (approximately 82 billion rubles), the revaluation of subordinated loans (a decrease of 32 billion rubles), and dividend payments (approximately 16 billion rubles).
Based on preliminary results, the capital adequacy ratio (N1.0) in August 2023 remained largely unchanged at 12.1%, primarily due to the even growth of average regulatory capital and capital (both increased by 2.6%).
The growth in regulatory capital in August was driven by monthly profits. Average regulatory requirements increased mainly due to the expansion of the credit portfolio and the revaluation of its foreign currency component, influenced by the ruble's depreciation by 5% against the US dollar.
The capital buffer remained stable, ending the month at around 6.7 trillion rubles.
Deputy Governor of the Bank of Russia Olga Polyakova did not rule out that the profit of the Russian banking sector in 2023 could amount to 3 trillion rubles ($30.9 bln).
"Given that nearly 2.4 trillion [rubles] have already been earned in eight months, anything is possible," she said.
When asked about next year, she noted, "Time will tell." "Everything will depend on how the macroeconomic situation will develop," Polyakova said.
Expert RA rating agency said on September 27 that, according to its projections, the banking sector's earnings at the end of 2023 will approach 3 trillion rubles ($30.9 bln), with the top 10 banks accounting for more than 75% of the profit.
84 RUSSIA Country Report October 2023 www.intellinews.com