December 2016 and year-end results: banking sector profits grow fivefold

Information and analytical material ‘On the Development of the Russian Banking sector in December 2016 and Year-end Results’ published on the Bank of Russia website focuses on the development of the banking sector in December 2016 and preliminary year-end results.

The appreciation of the national currency made significant inroads into the performance of Russian banks last year: the nominal value of assets of credit institutions dropped by 3.5% over the year, but grew by 1.9% if adjusted for currency revaluation.

Lending to non-financial organisations declined slightly (by 3.6%, adjusted for ruble appreciation). Household lending showed positive growth primarily due to the expansion of housing mortgage lending, which is socially and economically significant. The quality of both corporate and retail loan portfolios improved.

Sustainable deposit inflow (9.2% YoY, adjusted for currency revaluation) points that households still have confidence in banks.

In 2016, credit institutions increased their profits fivefold as against the previous year – from 192 billion rubles to 930 billion rubles.