Gref warned about unprofitability of the banking sector this year

Sberbank, like the entire Russian banking sector, showed record profits last year. According to the HEAD of the bank, if the banking sector "works to zero" this year,

With a high degree of probability, the Russian banking sector will suffer losses this year, and it will be an excellent result if it “works to zero”. This was stated by the head of the bank, German Gref, in an interview with the RUSSIA 24 TV channel at the St. Petersburg International Economic Forum (SPIEF).

“There will be an excellent result if the banking sector works to zero, but there are high chances that the banking sector as a whole will be unprofitable this year,” said the head of Sberbank.

According to Gref, Sberbank will solve all the problems that have arisen against the backdrop of sanctions by the middle of the year, including reserves, and from the second half of the year it will enter a normal mode of operation.

See also Organizer InterCHARM about sanctions and the future of the beauty industry in Russia 14:26

At the same time, the head of the bank said that he sees grounds for further reduction of the key rate of the Central Bank to 7% by the end of the year. “There are factors that allow us to talk about further rate cuts, in particular, deflation for four weeks in a row,” he said.

The Central Bank predicted record profits for banks

Last year, Sberbank increased its net profit under RAS excluding events after the reporting date by 1.7 times, to 1.24 trillion rubles. The amount was a record in the history of the bank. At the end of 2020, the indicator was 781.6 billion rubles, and in 2019, net profit was 870.1 billion rubles.

Read on RBC Pro Pro Sanctions traffic light:how bans affect different sectors of the economy Research Pro x The Economist You "eat" money:What awaits leaders in an era of stagflation Articles Pro 12 of the most popular Russian stocks:what experts expect from them Articles Pro Banks in Russia are urgently changing their software due to sanctions.What awaits the financial market Forecasts Pro How the "Fear Index" helps to predict the dynamics of the marketusa How can an investor make money on this? Articles Pro Will it set back 10 years? How to conduct digitalization against the backdrop of import substitution Forecasts Pro Throw back 10 years? How to conduct digitalization against the backdrop of import substitution Forecasts Pro Throw back 10 years? How to conduct digitalization against the backdrop of import substitution Forecasts

At the same time, over the past year, Sberbank’s net interest income increased by 12.3% to RUB 1.62 trillion, net fee and commission income grew by 13.5% to RUB 578.9 billion, and the amount of funds on customer accounts — by 11.1% excluding currency revaluation.

In general, the Russian banking sector last year showed a record profit of 2.4 trillion rubles. Excluding the bank of non-core assets "Trust", it amounted to 2.3 trillion rubles. - this is almost 1.5 times more than earned at the end of 2020, but it falls slightly short of the optimistic forecast of the Central Bank of 2.5 trillion rubles, which the regulator gave earlier.

The record profit result was shown against the backdrop of active growth in banking business volumes. Net interest income increased by 15% to RUB 4.1 trillion, net fee and commission income increased by 20% to RUB 1.5 trillion. “Low spending on reserves after banks had a lot of reserves in 2020, when the pandemic situation was extremely uncertain,” the Central Bank pointed out, also had a positive effect.

In early April, the United States imposed blocking sanctions on Sberbank , which provide for a “freeze” of assets in the United States, as well as a ban on American citizens from conducting any transactions with the bank. The United Kingdom introduced similar restrictions on Sberbank. On June 14, the bank was disconnected from SWIFT.