VTB Bank (PJSC) made a profit of 402.8 billion rubles from January to October 2023. This result was achieved despite the powerful sanctioning pressure that the financial institution has suffered since 2022. The result of the income for the first ten months of this year indicates de facto that the bank has recovered two thirds of the losses it suffered last year .
“We are on a good path when in less than two years we will cover the losses that the VTB group suffered as part of the negative events of 2022,” First Deputy Chairman of the VTB Board of Directors Dmitry Pyanov told reporters. — This is, in principle, a very good result from the point of view of capital recovery time. The losses of the VTB group for 2022 in the amount of more than 600 billion rubles will be covered.
Pavel Samiev, general director of the BusinessDrom agency and chairman of the Financial Markets Committee of OPORA RUSSIA, indicates that the bank recovered about 67% of its losses.
— VTB Bank has demonstrated an impressive ability to recover profits in the shortest possible time. In the near future, however, less favorable macroeconomic conditions are not conducive to repeating the records of 2023, the expert told RIA Novosti.
The general director of the NKR rating agency, Mikhail Doronkin, believes that by the end of 2023 the bank’s profit will amount to 430-450 billion rubles. At the same time, he underlines that in the context of the realization of interest rate risk there is a gradual decrease in the net interest margin: over 10 months it amounted to 2.9% compared to 3.1% overall.
In November-December the figure may decrease slightly. The strengthening, which had a positive impact on financial performance at the beginning of the year, was associated with the restoration of provisions in part of the loan portfolio. Today this effect no longer has any effect. However, the monthly return on capital is at a high level: around 15% per year.
Yuri Belikov, General Director of Validation at the Expert RA rating agency, explained to Izvestia that the increase in the bank’s net income was made possible by the growth of mortgage and consumer loans. According to the results of 10 months of 2023, it provided the bank with higher profits than throughout the entire year of 2021 before the crisis.
According to market analysts, retail lending may slow down significantly in 2024. This will have an impact on many large banks, but how exactly will only be known after the fact.
— The main question, relevant not only for VTB, but also for other large banks, is how this slowdown will affect their financial results, with a possible simultaneous increase in losses and a possible deterioration in asset quality. It is no secret that the debt burden of borrowers in the retail segment has already reached its peak,” notes Yuri Belikov.
The bank previously made comments and revealed its indicators, from which it follows that a slowdown in the pace of profit generation is expected already in November-December 2023.
The first deputy chairman of the board of directors of VTB, Dmitry Pyanov, believes that the banking market and the financial results of credit institutions are influenced by: shortages in the labor market, soft budget policy, an “uncooled” credit market , high price expectations from companies and an expected increase in wages next year.
— The bank only needs to earn less than 200 billion rubles in 2024 to cover 2022 losses in two incomplete years. We will surely earn 200 billion rubles,” Dmitri Pyanov is sure.
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