Central Bank of Russia outlines 2025 banking credit risk, provisioning and capital reforms and finalises a concentration risk implementation roadmap

The Central Bank of Russia published its Banking Regulation Review for 2024 Q4, setting out updated approaches to banks’ credit risk assessment and planned regulatory amendments that are expected to take effect in 2025 Q3–Q4. The package targets tighter control of higher-risk lending while reducing requirements where risks were assessed as excessive. On provisioning, the Bank plans to define a closed list of official documents for assessing an individual borrower’s income, while allowing banks to include loans of up to RUB 200,000 in homogeneous loan portfolios when such documents are unavailable, subject to higher loan loss provisions. It also plans a higher provision ratio for mortgage loans where payments increase by more than 20% per year and the total grace period exceeds three years. On capital, all banks with a universal licence will move to a more risk-sensitive finalised approach; the “investment-grade” borrower category (65% risk weight) will be tightened by requiring a national rating of at least A (for the borrower or its parent) and a standalone credit rating of at least BBB+; reduced SME risk weights will be discontinued for SME borrowers with outstanding loans above RUB 8 billion; and mortgage risk weights will be updated using default statistics and aligned between shared construction agreements and mortgages for existing housing. Separately, the Bank completed a report on the concentration risk regulation concept discussed the previous summer, which sets out further steps to finalise the framework and a timeframe for implementation.