Retail lending continues to surge in May
According to preliminary data, the growth of banks’ mortgage portfolio sped up from 1.4% in April to 1.7% in May. This could be associated with borrowers’ desire to raise a mortgage loan before the expected termination of the large-scale Subsidised Mortgage programme and changes to the targeted Family Mortgage programme. As before, over 75% of mortgages were issued under the government programmes.
Consumer lending expanded by 2.0%, driven by high consumer activity, rising incomes, and people’s seasonal expenses for vacations.
The growth of the corporate loan portfolio edged down from 1.9% in April to 1.7% in May. The increase was largely accounted for by lending to developers.
Amid high interest rates, household deposits with banks were up by 2.6% compared to 2.1% in the previous month. Contrastingly, after a 5% increase in April, legal entities’ funds declined by 2.2%, which was primarily because of tax payments.
Banks’ profit (excluding Russian subsidiary banks’ dividends) in May totalled ₽255 billion, which is 16% less month-on-month.
More details are available in the information and analytical material Russian Banking Sector Development in May 2024.