{"id":28432,"date":"2023-05-03T04:02:06","date_gmt":"2023-05-03T11:02:06","guid":{"rendered":"https:\/\/coinnetworknews.com\/russian-banks-set-for-record-profits-this-year-central-bank-rating-agency-say-finance-bitcoin-news\/"},"modified":"2023-05-03T04:02:06","modified_gmt":"2023-05-03T11:02:06","slug":"russian-banks-set-for-record-profits-this-year-central-bank-rating-agency-say-finance-bitcoin-news","status":"publish","type":"post","link":"https:\/\/coinnetworknews.com\/russian-banks-set-for-record-profits-this-year-central-bank-rating-agency-say-finance-bitcoin-news\/","title":{"rendered":"Russian Banks Set for Record Profits This Year, Central Bank, Rating Agency Say \u2013 Finance Bitcoin News"},"content":{"rendered":"
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Bank of Russia raised its forecast for the profits of Russian banks in 2023, expecting results that may break the 2021 record. This year\u2019s high numbers are coming after 2022 became the worst annual period in seven years for the sanctioned Russian banking sector in terms of financial outcome. <\/strong><\/p>\n

Banks in Russian Federation Headed for at Least $23 Billion in Profits in 2023<\/h2>\n

Data from the first months of 2023 give the Central Bank of Russia (CBR<\/a>) reason to believe that by the end of the year Russian banks can earn 1.9 trillion rubles (almost $24 billion), \u201cor even more, which is comparable to the profit for 2021,\u201d Deputy Governor Olga Polyakova unveiled at a conference held by the National Credit Ratings (NCR) agency.<\/p>\n

Two years ago, Russian banking institutions made a record-high 2.37 trillion rubles (close to $30 billion at current exchange rates), the business daily Vedomosti noted in a report, quoting the central bank official and the organizers of the forum.<\/p>\n

When it released its baseline projections in March, Bank of Russia expected net profits in the banking sector to reach 1.2 \u2013 1.5 trillion rubles this year and 1.2 \u2013 1.7 trillion rubles in 2024. Those estimates came after 2022 \u2014 when Russian banks earned only 200 billion rubles ($2.5 billion) \u2014 turned out to be the industry\u2019s worst year in a seven-year period.<\/p>\n

Amid unprecedented sanctions<\/a> in response to Russia\u2019s invasion of Ukraine last year, the state-owned giant Sberbank registered a net profit of just 300 billion rubles, a 75% decline over 2021, and Russia\u2019s second largest bank, VTB, reported a record loss of 756 billion rubles.<\/p>\n

NCR Believes This Year\u2019s Banking Sector Profits in Russia May Break the 2021 Record<\/h2>\n

In January \u2013 March 2023, however, Russian banks have already accumulated a record quarterly profit of 881 billion rubles, the Central Bank pointed out while also noting that excluding currency revaluation due to the weakening of the ruble, earnings amounted to 500 billion rubles.<\/p>\n

Meanwhile, ahead of the conference, NCR also updated its predictions for this year. The rating agency expects even more positive results than the monetary authority. The company said that banks\u2019 profits in Russia could reach 2.4 \u2013 2.6 trillion rubles and break the 2021 record.<\/p>\n

At the height of the crisis in 2022, the CBR sharply raised its key interest rate from 9.5% to 20%, which increased costs for banks through expensive deposits. The new forecasts coincide with its latest decision<\/a> to keep the rate at the current level of 7.5%, for the fifth consecutive time, against the backdrop of moderate inflation held back by the Russian economy adapting to sanctions pressures.<\/p>\n

\u201cWe will continue to help the banking sector adapt, we will create all the necessary conditions where possible,\u201d Polyakova assured. She emphasized that the central bank\u2019s policy of risk-based regulation and supervision as well as a decade of work on the financial recovery of Russian banks have helped them to survive the crises of 2020 and 2022 without significant losses. Nevertheless, they may still need up to 600 billion rubles to cover losses on assets blocked due to Western sanctions, according to the NCR.<\/p>\n

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Bank of Russia<\/a>, banks<\/a>, CBR<\/a>, Central Bank<\/a>, costs<\/a>, earnings<\/a>, forecast<\/a>, Forecasts<\/a>, interest rate<\/a>, Losses<\/a>, NCR<\/a>, Profit<\/a>, profits<\/a>, rate<\/a>, restrictions<\/a>, Russia<\/a>, russian<\/a>, Russian banks<\/a>, Sanctions<\/a><\/div>\n<\/div>\n

Do you think banks in Russia will register record-breaking profits in 2023? Share your expectations in the comments section below. <\/strong><\/em><\/p>\n

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\nLubomir Tassev <\/h6>\n

\nLubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens\u2019s quote: \u201cBeing a writer is what I am, rather than what I do.\u201d Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.

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Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons<\/em><\/p>\n

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