Moody’s has estimated losses of Russian banks due to the key rate 15% – RBC Daily

Moody's has estimated losses of Russian banks due to the key rate 15% – RBC Daily

The losses of Russian banks at the end of 2015 could reach 1 trillion rubles., Estimated by analysts Moody’s. The Bank of Russia expects a profit of several hundred billion rubles.

Pessimists

«aggregate net losses of banks in 2015 will amount to 1 trillion rubles. compared to the total net profit for the 2014 600 billion rubles. provided that the rate will remain at 15% and non-performing loans continue to rise, “- said in the review of the rating agency.

Bank’s interest income (earned and accrued interest on loans and securities) while maintaining 15 the interest rate may be reduced by about a third, to 1.5 trillion rubles., and the total income (taking into account the non-interest – commissions, dividends, etc.) was only 2.3 trillion rubles. This, according to analysts Moody’s, will not be enough to cover the administrative costs of banks, as well as the cost of reserves.

On Friday, January 30, the Bank of Russia has lowered its key interest rate from 17 to 15% per annum . The agency’s analysts believe that the decline only slightly may ease the situation for banks and borrowers who are still adjusting to the rate increase in December from 10.5 to 17%: the key rate above 12% negative for the banking system, emphasizes Moody’s. If such rate will last for two, three or more quarters, it will seriously degrade the performance of the banks, as would increase the cost of funding and contraction in net interest margin.

The losses, according to analysts Moody’s, will influence and already weak capitalization of Russian banks. The program of state support through the mechanism of OFZ help only to large and medium-sized banks, while the majority of small any help would be requested.

great pessimist

Analysts Alpha -Bank Natalia Orlova and Dmitry Dolgin even more pessimistic in their forecasts. In his review, sent out to investors on Monday, February 2, they predict losses of Russian banks in 2015 to $ 2 trillion rubles., Or 25% of the share capital of all organizations. The losses Orlova and Dolgin called securities revaluation, the increase in funding costs and allocations to reserves for problem debt.

According to them, only securities revaluation may lead to losses of 1 trillion rubles. “Since December 2014 bond prices have fallen by 30%. Recovery of the debt market following the downgrade Russian agency S & amp; P is not expected, “- said in the review. Even if the regulator does not allow banks to show these losses in the financial statements, they still have a negative impact on the cash position of the banks, analysts said.

Another 1 trillion rubles. banks will take away extra provisioning for bad debts. So, if in 2008 the share of the crisis of delay in Russian banks was at 2.5%, then at the beginning of 2015 it has almost doubled – to 4.7%, said Orlova and Dolgin. “It is obvious that the current situation in the Russian banking sector is more difficult than in 2009″ – the report says.

Deputy director of Interfax-CEA Buzdalin Alex says that because of the high rates of profitability of the banking sector has decreased ” Liabilities Expensive faster than the return on loans and the growth of credit rates are rising significantly and credit risk. ” He notes that expensive loans will take companies that are risky business. “Credit risks from such borrowers are very high, the lower the quality of the loan portfolio and, as a consequence, higher provisioning for them,” – said Buzdalin.

Optimists

According to the Bank of Russia, at the end of 2014, Russian banks made a profit of $ 590 billion rubles., which is 41% less profit 2013th: decrease was due to an increase in provisioning.

Representatives of the Bank of Russia has calculated that the banking sector will make a profit at the end of the year, although less than previously planned. First deputy chairman Alexei Simanovskiy said on Wednesday, January 28, that the profits of banks at the end of 2015 could reach several hundred billion rubles. Last autumn Simanovskiy predicted that the profit of the banks could reach 1 trillion rubles. “With the implementation of the most hard-case scenario profits will be very small, two or three hundred billion rubles, maybe even less – quoted by Interfax news agency Simanovskiy. – At the same time I can not exclude options when profits will be more – half a trillion. Various possible scenarios greatly affect the income loss associated with the condition of assets and, accordingly, the profit of banks ».

According to the First Vice President of Gazprombank Ekaterina Trofimova, Moody’s assessment looks extremely pessimistic. “Saving the key rate at a relatively high level would increase the cost of new banks’ liabilities, in particular Bank of Russia refinancing. However, a significant proportion of commitments (50%) sector has a medium- and long-term nature, and the rate change will be reflected in their cost less, “- says Mills. According to her, a greater risk to the financial results are deteriorating credit quality of the loan portfolio and the need to create additional reserves for possible losses.