Russian banks' loans gain momentum, bad loans down

MOSCOW, July 30 (Reuters) - Russian banks' loans to firms grew 2.1 percent in June in the biggest upward move since February 2009 and the volume of bad loans declined for the first time since the crisis, the central bank's data showed on Friday.

The central bank expects the banks' total loan portfolio to grow by roughly 10 percent in 2010, forecasting more demand for loans in the second half of the year as the rouble remains largely stable and inflation is under control.

However, the total loan portfolio excluding loans to other banks added 3.1 percent since the beginning of the year to 17.7 trillion roubles, according to Reuters calculations.

Loans to corporates grew 3.9 percent from Jan 1 2010 and loans to individuals increased by 1.6 percent in June and 2.8 percent for the first six months to 3.67 trillion roubles.

A portfolio of overdue corporate loans decreased in June for the first time since the crisis to 800.2 billion roubles from 807.1 billion as of June 1, with a share of overdue loans shrinking to 6.57 percent of total loans to corporates.

Russia's major banks, including state-controlled Sberbank (SBER03.MM), VTB (VTBR.MM) and VEB, have already raised roughly $3.5 billion worth of eurobonds, collecting funds to meet growing demand for loans.

The total banking profit increased in June by 22.6 percent to 249.5 billion roubles month on month in Russian accounting standards, with a number of profitable banks rising to 879 from 803 in May.

Sberbank and VTB have both posted record high profits in the first quarter on the back of easing provisions for bad loans and expect to return to pre-crisis profitability already this year. (Reporting by Dmitry Sergeyev; Editing by Jon Loades-Carter)