Russia's biggest bank detects signs of recovery

25th November 2015, Comments 0 comments

Russia's biggest bank, state-controlled Sberbank, said on Wednesday that it sees signs of recovery in the financial sector which has been in deep crisis.

Reporting the bank's "best quarterly results of the year" for the three months to September, finance director Alexander Morozov said Sberbank had booked higher interest earnings, and mortgage lending was also on the rise.

Net profit for Sberbank came in at 65.4 billion rubles (930 million euros, $993 million), down 8 percent from a year earlier but ahead of forecasts from analysts' polled by the Interfax agency.

Interest income rose 25 percent and commission earnings by 33 percent.

But provisions against non-performing loans were also up, by 25 percent, which was however a smaller increase than expected.

The Russian banking sector has paid a heavy price for the country's economic crisis, brought on by sharp declines in the oil price and Western sanctions over Ukraine.

Soaring interest rates accompanied by corporate and household insolvencies have forced banks to set aside large provision against bad loans.

Some 70 small banks have filed for bankruptcy since the beginning of the year, including 10 in November alone.

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© 2015 AFP

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