The Central Bank of Russia published its February 2025 update on the Russian banking sector, showing a modest recovery in corporate and mortgage lending, a continued contraction in consumer credit, stronger household deposit inflows, and a marked decline in sector profitability. The corporate loan portfolio rose 0.1% in February after a 1.2% drop in January, with lending growth still constrained by large budget expenditure as companies receiving compensation under state contracts did not need loans. Mortgage lending increased 0.2% after a seasonal 0.2% decline in January, while the consumer loan portfolio fell 0.9% (from -0.3% in January) amid high interest rates and strict macroprudential policy. Household funds held with banks grew 1.9% after a seasonal 0.8% decline in January, supported by attractive deposit rates, while business funds were broadly flat at +0.1% after +0.5% in January. Sector profit fell by around a quarter to RUB 214 billion from RUB 286 billion in January, driven by higher operating expenses and a negative foreign-currency revaluation. Further detail is set out in the information and analytical material “Russian Banking Sector Development in February 2025”.
Central Bank of Russia 2025-03-25
Central Bank of Russia reports February lending stabilisation and banking sector profit fall to RUB 214 billion
The Central Bank of Russia's February 2025 update indicates a modest recovery in corporate and mortgage lending, continued contraction in consumer credit, and stronger household deposit inflows. Sector profitability declined significantly, with profits falling to RUB 214 billion from RUB 286 billion in January, due to higher operating expenses and negative foreign-currency revaluation.