Lending surges in November, but consumer lending starts to cool down
The mortgage portfolio expanded by 2.8% in November, which is only slightly less than 2.9% in October. However, the overall amount of issued loans decreased more notably, specifically by 6%. These dynamics suggest a reduction in mortgage repayments, including those made ahead of schedule.
The increase in unsecured consumer lending slowed down to 1% in November vs 1.1% in October, although consumer activity normally grows at the end of the year. Considering the effective macroprudential measures, the deceleration might become more significant in the next few months.
The growth of corporate lending remained fast (2.0% in November vs 2.3% in October). However, this rate could be lower excluding large loans issued to finance business acquisitions.
Households’ funds with banks surged by 2.1% compared to 1.4% in October. High interest rates encourage people to increase savings and return cash to banks. Corporate funds soared as well, namely by 2.6%, after a weak inflow of 0.2% in October when companies were making quarterly tax payments.
The banking sector’s profit totalled ₽268 billion (return on capital — nearly 23% in annualised terms), which is close to ₽256 billion in October. The sector earned ₽3.2 trillion since the beginning of the year.
More details are available in the information and analytical material Russian Banking Sector Development in November 2023.