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Russia's Sberbank net profit growth slowed by provisions
August 7, 2014 / 7:02 AM / 3 years ago

Russia's Sberbank net profit growth slowed by provisions

MOSCOW, Aug 7 (Reuters) - Russia’s top lender Sberbank said on Thursday that net profit between January and July rose 0.8 percent year on year to 222.1 billion roubles ($6 billion), as loan-loss provisions more than doubled due to an economic slowdown compounded by the Ukraine crisis.

State-controlled Sberbank is an important lender to Russia’s $2 trillion economy, which is on the verge of recession as lower investment and rising capital flight in the wake of Western sanctions curb growth.

The bank, which owns around a third of the assets in the Russian banking system, said loan-loss provisions rose to 162.6 billion roubles for the first seven months of the year, compared to 67.3 billion roubles a year earlier, according to Russian Accounting Standards (RAS).

“The bank continues to practice a conservative approach in loan-loss provisioning based on the requirements of the central bank of Russia,” it said.

It said its net profit figure was also affected by changes in Russian banking regulations. The bank posted a 2.8 percent fall in net profit for the first six months of the year, according to RAS.

Its share of non-performing loans edged up to 2.5 percent at the end of July from 2.4 percent at the end of June.

Net interest income was up 23.7 percent for the first seven months of 2014, the bank said.

1 US dollar = 36.2522 Russian rouble Reporting by Alexander Winning; editing by Jason Neely

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