Sberbank will cut interest rates on retail loans as inflation slows, chief executive German Gref said Friday.
Sberbank will lower rates on all retail loans starting Monday, Gref said during a meeting with Prime Minister Vladimir Putin, according to a government transcript. Signs of “insignificant” credit portfolio growth are emerging for the first time this year, which is the “beginning of a positive trend,” he said.
“We are significantly modernizing our credit policy because the inflation rate has been falling recently,” Gref said. “We see that until the end of this year, the trend of falling inflation and a further lowering of interest rates will continue.”
Consumer price growth eased to the slowest rate in 12 years in March, reaching an annual 6.5 percent. The credit portfolio of Russian banks excluding Sberbank expanded about 1.5 percent in March, the first indicator of lending growth this year, according to Central Bank Chairman Sergei Ignatyev.
This may be “a coincidence or a change of trend,” he said on April 9. Lending may grow 15 percent this year, according to Ignatyev. The Central Bank cut its main interest rates for the 12th time in less than a year on March 26 to resuscitate lending and contain the ruble’s gains.
Sberbank, which extended about 78 percent of all Russian mortgage loans last year, posted “difficult post-crisis results,” Gref said. The economy of the world’s biggest energy exporter contracted a record 7.9 percent last year after commodities prices plunged and global credit markets shut down.
“Companies had a significantly higher shock than individuals” during the crisis, Gref said. In contrast to developed economies in Europe and America, Russian incomes increased “somewhat” last year because government pensions grew, he said.
The retail lending portfolio is set to recover faster than corporate lending, which is also going to expand as companies become more active in the second half, Gref said.?
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