Elvira Nabiullina’s speech at Association of Russian Banks
Good afternoon, dear colleagues.
I am pleased to welcome you all to our traditional meeting. As usual, I would like to begin with an overview of the current situation in the banking sector and our forecasts of its development.
We may say that the banking sector’s performance over 2025 was strong. Lending was growing at a more balanced rate, which has led to a decline in inflation that we see now, while also preserving all the financial resources required for economic development. This year, we expect the balanced growth trend to continue: our forecast is currently within the range of 7–12% for corporate loans and 6–11% for mortgages. We also expect unsecured consumer lending to resume growth, estimating it at around 4–9%, on account of a decrease in interest rates and the debt burden.
Banks’ profits – the exact figures were given by Mr Aksakov – were largely capitalised. However, profits edged down, as compared to the previous year, against the backdrop of banks recognising their credit losses. Nevertheless, these profits allow banks to maintain capital adequacy, support lending growth, and restore capital buffers.
Although it is still the beginning of the year, we expect 2026 profits to be close to last year’s level, that is, within the range of ₽3.3–3.8 trillion. Certain banks and analysts are more optimistic in their forecasts, anticipating a reduction in loan loss provisions, while our estimates remain more cautious here. If banks perform better – good! They will thus be able to accumulate additional capital cushions.
Now, about the key areas mentioned by Mr Aksakov. Strengthening banks’ capital base, preventing credit risks, and managing non-performing loans – all these work streams remain relevant in 2026.
First, as regards strengthening banks’ capital base. This is a key objective, and we can see that banks are doing well. A more moderate pace of lending expansion enabled banks to build up their capital cushions in 2025. For the first time since 2022, capital adequacy demonstrated growth, having increased by 0.7 pp to 13.2% over 2025. The total amount of banks’ capital cushions above the minimum threshold of required ratios is now about ₽9 trillion, which is a good safeguard against stress conditions.
All banks have managed to comply with the ratios that have risen since the beginning of this year. According to an earlier approved schedule, there will be two more increases in the ratios to the target values over the next two years. I should say that most banks already comply with these ratios in advance, so for them, it is only about maintaining their capital buffers at the current level. Nevertheless, certain banks will have to try harder to catch up with others.
I would like to highlight that, according to our estimates, banks are on schedule in terms of these requirements, provided that lending continues growing at a balanced rate. We closely monitor the situation and regularly assess the potential of lending to the economy, considering all our planned regulatory measures, among other things, in order to avoid a credit crunch.
After restoring basic add-ons, we plan to start setting differentiated capital buffers for systemically important banks, approximately starting from 2028. I know that many banks would prefer to postpone this decision to a later date, i.e. until 2030, pointing to the persisting sanction pressure and the need to recognise losses on frozen assets. Nevertheless, we are convinced that introducing differentiated buffers, which we discussed long ago and in detail, is necessary to prevent systemic risks of major market participants. That said, we do not plan to introduce them all together, but will do it smoothly, similarly to the existing buffers. Moreover, next year, we will extensively discuss with banks the schedule for introducing these buffers as well as their size to take into account all nuances.
As you know, we intend to raise minimum capital requirements for small banks, approximately by the rate of inflation accumulated since 2018 when the effective requirements were established.
I know that some small banks are also concerned whether they will be able to bolster their capital cushions in the current environment, but I would like to emphasise that we are going to increase these requirements gradually as well – over the course of several years. According to our estimates, the vast majority of market participants will not be affected by this novelty as their capital already exceeds our targets for minimum capital requirements. Those affected will be able to increase their capital base through profits and recapitalisation, or, in the worst-case scenario, by changing the licence type – they will have enough time for that. We will shortly prepare a consultation paper on this topic and discuss details with you. Today, at the round table, my colleagues will be separately talking about our main plans regarding capital regulation.
Banks often complain that we do nothing but increase their burden. However, where risks are declining, and we do see this, and changes in regulation will help mitigate long-term risks, we are ready to ease regulation. Therefore, this is not a one-way street. Specifically, the new national liquidity coverage ratio is even less restrictive than Basel III as it is tailored to the Russian context. Another example is the approach to deducting intangible assets, which banks have created and continue to create as part of import substitution plans, from capital calculation. These are significant investments for many banks that put additional pressure on their capital. We have adopted a decision – and will release it soon for your information – to allow banks to deduct intangible assets over the course of four years, rather than simultaneously as it is stipulated now.
To be clear, this will only affect those assets that relate to the critical IT infrastructure that banks are obliged to replace as part of import substitution. For some banks, the effect will be up to 0.5 pp of capital adequacy, according to our estimates.
Turning now to the subject of preventing credit risks and managing non-performing loans. This is the second topic that we also raised last year and that remains relevant in 2026.
Talking about the retail portfolio, the share of problem loans in it has expanded, which was inevitable after two years of fast lending growth. Nevertheless, the proportion of non-performing loans is far below its historic highs and is already trending downwards. The quality of new disbursements has improved since mid-2025. According to our estimates, this improvement is attributable to, among other things, macroprudential policy measures.
As to the corporate loan portfolio, its quality remains good overall, with the majority of borrowers proving to be resilient and banks having enough capital and provisions to cover potential losses on problem loans. To additionally encourage banks to meet the needs of borrowers facing temporary hardships, we have recommended restructuring such loans. Mr Aksakov has mentioned that we are acting flexibly here. Indeed, it is essential considering the current stage of economic development and the need to transition to more balanced growth rates of both lending and the economy. That said, where a borrower has a realistic financial recovery plan and follows it, banks are allowed not to make additional loss provisions.
Nevertheless, we are concerned about a possible accumulation of risks in the future and are taking preventive measures to avoid it.
As you know, from 1 March, we have raised the macroprudential add-on for new loans issued to large borrowers – to be more exact, to highly leveraged large borrowers. We are ready to raise it further if the outstanding debt of highly leveraged large companies continues to increase fast on account of bank funding. This will indicate an underestimation of risks, in our view, and we will therefore have to respond accordingly. This is part of the reason why we consider it important to ensure that more companies enter the stock market to raise non-bank funding, that is, not only debt but also equity financing. The above is crucial for companies to maintain their resilience and an acceptable level of debt burden and for banks to avoid an excessive increase in concentration of claims on certain borrowers.
In addition, we will phase in measures to prevent banks from employing a purely technical approach to assessing corporate credit risks. Specifically, in 2026 Q3, we will restrict the use of expert opinions (regarding the so-called other material factors) in banks’ assessments of large problem loans. For example, now, banks may base their assessments on the assumption that a borrower will receive government support even if there are no solid grounds for that. Simultaneously, we are going to allow banks to take into account more objective indicators, e.g. actual cash flows of a borrower, so that their provisions cover the part of the debt that such flows are insufficient to cover.
Next year, we plan to prohibit banks from recognising a company’s financial position as good or medium if it is a highly leveraged business (e.g. with a debt-to-EBITDA ratio above six and an interest coverage ratio below one) and oblige banks to take into account sureties issued by a borrower to other companies when analysing this borrower’s debt burden.
It is very important to gradually address the problem of high credit concentration at the level of individual banks. Unfortunately, banks are not so eager to reduce concentration on their own, although we constantly remind them about related risks. We do understand that decreasing the level of concentration requires difficult conversations with clients, large ones, which is a challenging process. However, this is critical as the objectives of ensuring the resilience of both a particular bank and the financial sector as a whole are coming to the fore in this regard. Over the next few months, we will present the final concept of concentration regulation, including the details of economic and regulatory stimuli to reduce the concentration ratio. Our objective, which we have repeatedly announced and explained, remains unchanged. Namely, in several years’ time, there should be no bank left with credit exposure exceeding 25% of its capital. It has to be achieved to ensure the resilience of the entire financial sector.
To assist banks in spreading credit risks and lowering the level of concentration, we plan to incorporate credit digital financial assets (DFAs) and credit default swaps (CDSs) into regulation in 2026 Q3. I know that banks are interested in these instruments, including to reduce concentration, so I will elaborate on this matter.
Credit DFAs enable greater flexibility in managing the ratios by transferring credit risk from a bank to investors. That said, we will also introduce a retention requirement for a bank to retain part of the risk. It is important for banks to be interested in transferring quality risk to the market.
As regards CDSs, we plan to develop this instrument in stages. First, we will allow a wide range of banks with high ratings to sell CDSs. Subsequently, we will consider gradually expanding access to this segment of derivatives to insurers and other market participants. We need to ensure that CDSs are only sold by those participants that have profound expertise in analysing and managing credit risk. Incorporating this instrument into regulation will make it possible not only to release capital on account of ‘insurance’ provided by a quality counterparty, but also to spread the risk across the system.
Another important topic concerns the development of risk-based supervision instruments. Last year, we prepared a report on changes in the approach to assessing banks’ economic position and presented it to market participants. Let me remind you that the new method will enable a more flexible classification of banks by risk level, similarly to the procedure implemented by credit rating agencies. We will supervise banks with low ratings very closely and they will pay higher contributions to the compulsory deposit insurance fund. Vice versa, high ratings will allow banks to pay lower contributions.
We have received many comments and questions as feedback on the report and have taken into account most of them. I thank you for your deep engagement and assistance in making our approach simpler and more risk-sensitive. The Bank of Russia is currently testing the updated method and will present the results at the Financial Congress in summer to discuss them.
These are the key issues related to banks’ resilience. No less important for us – and I hope for you too – are the topics of consumer protection, competition, and the banking system’s openness to innovation. Now, I will elaborate on these points.
First of all, I would like to note positive trends in consumer protection, namely a declining number of complaints about tied selling, misselling, and misrepresentation. Complaints, however, show new problems as well. I would like to draw your attention to two of them.
The first one is banks’ failure to comply with the procedure and deadlines for considering clients’ applications, established by law in 2024. People complain (and, unfortunately, the number of such complaints is growing) about delays in responding and formulaic letters instead of substantive answers, or even no reply at all in some cases. If banks fail to improve the quality of complaint handling, which reflects their real customer focus that almost all banks claim to have, we will go further than merely issuing recommendations. Currently, we only give advice in this regard, which is often the case, and we warn banks that if such violations recur, they will receive enforcement orders, including penalties. The information about this will be published on the Bank of Russia website for clients to know which banks are really customer focused and which are not.
The second issue at hand is how banks process applications of those clients whose transactions are restricted in accordance with the anti-money laundering laws or as part of combatting fraud. We have had multiple discussions of this topic as it is a matter of concern for your clients. We also discussed it at the Ural Forum. I would like to reiterate that we receive many complaints that are directly related to the fact that, after a transaction was restricted, people do not always understand the reasons, what to do, and where to apply to lift these restrictions – especially when people know that they are bona fide customers. By the end of 2025, the number of complaints stopped growing, having stabilised, and banks notably improved their communication. We communicated with you about this for you to better communicate with your customers. However, the situation is far from being perfect. Therefore, we propose a proactive approach that I also spoke about at the Ural Forum – do not wait for your customers to apply to you. If a customer’s transactions have been restricted, you should proactively inform this customer about further steps and the reasons behind the restrictions. Banks should not just include a link (as is often the case) to Federal Laws No.
In our view, banks should also proactively work with those customers who – as you can see early on – will have problems servicing their loans. Do not wait until there are significant loan delinquencies. Customer focus should not only be applied in sales (which banks pay attention to), but also in resolving customers’ problems, including those related to loan repayments. If you do so, people will be less inclined to resort to debt relief companies. You are well aware that there is an acute problem with them as, more often than not, borrowers’ situation only becomes worse after they apply to these companies. Therefore, we urge banks to pay attention to this matter and take a proactive approach to working with customers having risks of delinquency.
The issue of debt relief companies has already been discussed at the venue of the Association of Russian Banks, and I would like to thank you for your specific proposals. We believe that the first step should be to develop standards for advising and assisting customers on matters of overdue debt. This will help people clearly see which debt relief companies will really help and which are only seeking to aggressively cash in on others’ misfortune.
A few words about a specific but important topic also related to financial consumer protection – about the situation with mortgages issued for single-family home construction. I believe you remember this case where, because of contractors, thousands of borrowers both lost their homes and still had to repay their mortgages because the requirement regarding escrow accounts had not been applicable when they took out these loans. In April 2025, we recommended that you provide support to these borrowers. Owing to the measures taken by banks – we appreciate those who stepped up – the situation has notably improved. However, this is still a pressing problem for a relatively small number of socially vulnerable households. We are closely monitoring the situation because this persisting problem is unlikely to resolve by itself. We recommend that you restructure their loans again, as necessary. Banks should be more proactive in discharging debts – whether in full or in part – for borrowers who are unable to service their mortgages for objective reasons, especially considering that people often relied on the list of developers that banks published on their websites. Although this is not exactly foisting these developers on customers, the latter trust the information you provide, including the lists of developers on your websites, even without direct recommendations to apply to them.
This is also about customer focus. Real customer focus is precisely about solving problems like these. By the way, the cost of such support – if you provide full support to customers with mortgages for single-family home construction – is not that high. It amounts to a little more than ₽4 billion for the entire banking sector. I do believe that banks are able to solve this problem, and I would prefer not to raise this issue again. In addition, I would like the Association to step in here.
Last year, we extensively discussed with you new fines for systemic violations of consumer rights. They will be many times higher than those that were effective in the past. Therefore, we discussed the conditions for applying the fines in advance at the State Duma Committee on Financial Market. The Bank of Russia prepared the related draft ordinance taking into account these arrangements. Specifically, we will not apply higher fines for violations of laws or regulations effective for less than six months. This is reasonable as banks should have time to adjust to new requirements. However, beyond this timeframe, a violating bank will not only fully compensate consumers for damages, but also pay an equivalent fine. The aim is to make lying to customers unprofitable.
Now, on to the next topic, which is crucial for both resilience and consumer protection. I am talking about competition. Here, I should definitely mention disagreements between banks and marketplaces that started with bank cards and discounts, but ultimately pushed us to take a broader view of this topic and comprehensively discuss changes and challenges for competition related to the development of the platform economy.
Together with the Russian Government, we are currently discussing the so-called open model for providing any financial services on marketplaces. All banks should have an opportunity to offer their bonuses and cashback on marketplaces. The same goes for financial products, e.g. loans and buy-now-pay-later services.
However, this is only one side of the coin. It is fair to apply the same benchmark to partnership projects within ecosystems developed by major financial market participants and participants from other industries, such as retail chains. We suggest discussing an approach ensuring that the principles of non-discrimination and equal access to infrastructure apply uniformly to all major companies with an ecosystem business model and a multi-million user base. It does not matter which business is the basis of an ecosystem – whether it started as e-commerce or banking services. What matters is to make sure that neither side enjoys preferential treatment at the expense of the other, and that the terms of partnership are known in advance and transparent to all, e.g. published on the website. Transparent terms of competition are important for consumers because the greater competition is, the better outcomes it brings to consumers.
The Russian Ministry of Economic Development, with the participation of the Federal Antimonopoly Service and the Bank of Russia, is currently analysing loyalty programmes offered by marketplaces, retailers, and banks. I will repeat: it started with marketplaces, but the same practices are applied by other market participants with an extensive client base, including by major banks. The approaches should therefore be uniform. This is a resolute stance of the Bank of Russia as a regulator. What matters to us is fair rules of competition within the financial sector as well. Today’s agenda includes developing a memorandum to codify best competition practices, including the principle of an open model. We are ready to discuss the content of this memorandum with both platforms and banks and believe it equally important for them to join the memorandum as, otherwise, it will not be effective. In this regard, I think the Association could play a key role in organising this dialogue. We would like to summarise the first outcomes of these efforts at the Financial Congress in July. Together with the Government, we also discussed the need to amend the legislation if the memorandum turns out to be inefficient or not all stakeholders decide to join it.
The second point I would like to mention in the context of competition is the introduction of a universal QR code this year. Once it is introduced, people will be able to scan the QR code at any point of sale, irrespective of their bank, and choose a payment method they prefer. This means that people will actually have a free choice. It is very important to prevent imposing any payment methods and domination of major players.
According to law, banks must ensure the support of payments using a universal QR code starting September 2026. We are going to release the rules of its use as soon as this March. As part of supervision, we will be paying close attention to whether banks make timely adjustments, if necessary. Some banks need to introduce certain adjustments. We will make sure that all banks are ready for this by September.
Another factor to boost competition is the emergence of non-bank payment service providers. We have been discussing this topic for many years already. Surely, many banks would prefer not to see any new payment service providers enter the market. However, this long-lasting discussion is close to an end, in my opinion. We have taken into consideration many comments made by banks, but there is one area where our position has remained unchanged, namely non-bank payment providers will have the freedom to operate independently of banks. Otherwise, this institution makes no sense. I mean that, essentially, this independent status should enable fintech companies to introduce innovations to the market faster. This is not just about how innovative the current participants are, but rather about the innovative potential of the entire financial sector. Therefore, those who design innovations that are convenient for people and cost-effective for the economy should be able to roll out these products quickly and compete with market leaders, including to prevent the latter from resting on their laurels. Overall, this will reduce transaction costs in the economy. Now, technologies already enable businesses to substantially cut their transaction costs. We know how important this is for companies, especially for small and medium-sized businesses that pay quite large amounts to conduct their transactions. If this is technologically possible, our job is to make it happen and ensure that the financial sector provides these services. The relevant draft law is ready to be submitted for the second reading, and I hope that the State Duma will adopt it at this session.
In conclusion, I would like to speak about one of the most significant and expected events of 2026, namely the introduction of the digital ruble and making it available to everyone, that is, to all clients of major banks. In this regard, we are on schedule. Specifically, all essential functions (transfers and payments) are operational, a multi-level protection of the digital ruble platform against cyber threats has been built, and first-wave banks are completing their preparations to provide the new option to all those who wish to use the digital ruble.
Over the past year, we introduced payments in digital rubles using a universal QR code, successfully tested the digital ruble in fiscal processes on some projects, and received a lot of meaningful suggestions from banks regarding the advancement of the digital ruble. Your proposals are very important to us as they will help us ensure that the digital ruble is truly in demand. One such proposal is the creation of a platform of commercial smart contracts where market participants would be able to introduce their own developments. We strongly support this idea – this is the only way to create a wide range of smart contracts and continuously enhance it. Furthermore, we see that the Government and businesses are really interested in using smart contracts in digital rubles as a way to automate, simplify, and reduce the cost of all manual checks and operations. This year, we will present the concept of a platform of commercial smart contracts to you for discussion. After the discussion, we will need to find ways to develop it quickly, because there is clearly demand for such a platform.
That is all I wanted to talk about today. It has been a long speech, but I wanted to mention both the problems we see and the main plans and regulatory changes that will affect you. I know there are questions, and we will discuss them now. My deputies and I are ready to answer them. Thank you.