Household funds with banks rise at a record pace amid high interest rates and income growth

Amid tighter monetary policy, corporate lending decreased by more than 50% to 2.4% in 2024 Q1 compared to 2023 Q4 but remained above expectations. The 2024 forecast for corporate lending growth was raised from 6–11% to 8–13%.

Mortgage lending slowed down significantly to 2.6% primarily due to changes in the terms and conditions of government subsidised programmes, tight monetary and macroprudential policies, as well as a seasonal decrease in activity at the beginning of the year. The 2024 forecast remained within 7–12%. Contrastingly, consumer lending noticeably sped up to 3.7%, which was driven by high consumer activity on the back of household income growth. The 2024 forecast was revised upwards from 3–8% to 7–12%.

The banking sector earned about ₽0.9 trillion in 2024 Q1. The growth in profit was mainly due to a decreased cost of risk on corporate loans and lower operating expenses. Taking into consideration growth of business, a moderate decrease in margins, and low provisioning, the 2024 profit forecast was increased to ₽3.1—3.6 trillion.

More details are available in the quarterly review Banking Sector.