Risk-weight add-ons
Since 2018, the Bank of Russia Board of Directors sets risk-weight add-ons to calculate capital adequacy ratios for credit institutions. From 1 February 2025, the Bank of Russia Board of Directors’ decisions to increase risk-weight add-ons come into effect no earlier than a month after the publication, while decisions to decrease risk-weight add-ons may become effective immediately after their release.
From 1 February 2025, the application of macroprudential add-ons is regulated by Bank of Russia Ordinance No.
Risk-weight add-ons for retail loans are differentiated based on the following characteristics of asset types determined by the Bank of Russia Board of Directors.
| Credit claim type | Loan characteristics taken into account to set macroprudential add-ons |
|---|---|
|
Mortgage loan for existing housing |
DSTI |
| LTV | |
|
Mortgage loan for new housing under construction |
DSTI |
| Down payment | |
|
Mortgage loan for single-family home (individual housing) construction |
DSTI |
| Down payment | |
| General-purpose consumer loan secured by residential property | DSTI |
| Car loan | DSTI |
| General-purpose consumer loan secured by a motor vehicle | DSTI |
|
Unsecured consumer loan (microloan) without a credit limit |
DSTI |
| EIR | |
|
Unsecured consumer loan (microloan) with a credit limit, including credit cards |
DSTI |
| EIR | |
| Retail loan in foreign currency | DSTI |
| Corporate loan in rubles or foreign currency or investment in highly leveraged companies’ bonds | |
| Corporate loan in foreign currency or investment in exporters’ and non-exporters’ bonds | |
| Corporate loan in rubles issued for commercial property construction |
Note. DSTI – debt service-to-income ratio; EIR – effective interest rate; LTV – loan-to-value ratio.
Add-ons for corporate foreign currency loans were used in
To limit the over-indebtedness of large companies as well as the banking sector’s credit risks, starting from 1 February 2025, risk-weight add-ons may also be set for claims related to loans (microloans) and investments in bonds of highly leveraged large corporate borrowers, in rubles or in foreign currency. The add-ons are applied to increases in banks’ claims on highly leveraged large corporate borrowers. The add-ons are applied to the above claims if the following three conditions are met simultaneously:
- the total outstanding debt of a borrower and its related entities to a bank is over ₽50 billion and 2% of the bank’s capital;
- the ratio of a borrower’s debt on a consolidated basis to the banking sector’s capital exceeds 2% (if there are IFRS consolidated financial statements) or the amount of a borrower’s liabilities on an individual basis to a bank exceeds ₽50 billion and no less than 2% of the bank’s capital (if there are no IFRS consolidated financial statements); and
- a company is highly leveraged, i.e. its interest coverage ratio based on operating income before depreciation and amortisation is less than 3.
In addition, add-ons may be established for corporate loans issued to finance real estate transactions (although they have not been established yet).
Additional clarifications on the calculations and threshold values are published in Russian only.