Net profit of Russian banks almost tripled in June

Russian banks’ total revenues reached 1.2 trillion roubles in the first half of 2021, which is almost twice as much compared to the same period of 2020.

Russian banks’ net profit amounted to 204 billion rubles in June, which is 2.9 times more compared to June 2020, but 5.6% less than in May 2021, according to the Bank of Russia’s Review of Banking Sector.

"The sector's net profit amounted to 204 billion roubles in June (22% return on capital, year-on-year), slightly lower than in May (216 billion roubles), as a result of negative currency revaluation amidst the rouble strengthening,” the regulator reports.

In June 2020, banks earned about 70 billion roubles. Russian banks’ total revenues reached 1.2 trillion roubles in the first half of 2021, which is almost twice as much compared to the same period of 2020.

The Bank of Russia attributes this result to lower provisioning costs (dropped from 729 to 298 billion roubles) and business growth.

Increase in the net interest income (by 223 billion roubles, or 13%), mainly due to less interest paid on individuals’ deposits, had positive effect on that.

Also, net fee and commission income grew by 150 billion roubles (27%) due to increased income from the payment and cash services for corporate clients and from the brokerage services provided.

The financial results of credit institutions in the first half of the year were adversely affected by a 10% increase in operating expenses and a twofold decrease in the income from foreign currency revaluation and transactions (from 122 to 56 billion rubles).

The number of profitable banks increased from 234 to 237 in June. And the share of profitable credit institutions grew to 98% in the sector's assets in the first half of 2021. Over 80% of the profit was generated by systemically important banks.

Source: Prime

Tweet