Net profit of Sberbank in 2017, investors were cheered

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Sberbank has published financial statements in accordance with IFRS for the year 2017. Bank’s net interest margin for the year increased by 7% to 1.45 trillion rubles, Net fee and Commission income increased by 13% to 394,2 bn and total income increased for the year 2017 by 12.1% to 1.9 trillion rubles. the Bank’s Net profit grew by 38.2% to 749 RUB bn Net interest margin for the year increased from 5.7% to 6%, return on equity (ROE) rose from 20.8 per cent to 24 per cent and return on assets (ROA) increased from 2.1% to 2.9%.
The increase in net profit of “Sberbank” was caused, on the one hand, an increase in income is associated with an increase in lending, on the other hand, a reduction in operating costs and expenses provision for impairment of debt financial assets. For 2017 Sberbank has increased the credit portfolio by almost 7% to 18.7 trillion rubles, including the volume of credits granted to natural persons increased by 13.6% and corporate customers by 4%.
Significantly increased “savings” and the securities portfolio (21% to 2.72 trillion) thus, the total assets of Sberbank grew by almost 7% a year before 25.37 trillion. in Other words, the total assets of “Sberbank” for 2017 was approximately 30% of the total assets of the Russian banking sector, if we compare the assets of “Sberbank” with the figures for total banking sector, published by the Bank of Russia. In addition, the growth of the total assets of Russia’s banking sector (6.4% in 2017) has been moving in the same direction with the dynamics of the assets of “Sberbank”.
The largest Bank in the country was probably the main beneficiary in the Russian banking sector from the multiple reduction of the key rate of the Central Bank of the Russian Federation in 2017, as lower interest rates of the Bank of Russia caused the reduction of interest rates of commercial banks for loans and significantly increased demand from individuals for lending and deposits citizens continue to keep it in the “savings Bank”, despite the fact that interest rates on Bank deposits in 2017 is also decreased. Thus, the volume of funds of individuals on deposits in “Sberbank” for 2017 increased by almost 8%.
However, the demand of enterprises for loans, especially non-financial sector, is still quite moderate, despite the favorable conditions offered by Sberbank. We believe that further reduction in the rate of the Central Bank of the Russian Federation “Sberbank” in 2018 will further boost customer base in the market of crediting of legal entities and individuals.
Natalia Milchakova,
The Deputy Director of analytical Department,