AGL 5.27 Decreased By ▼ -0.23 (-4.18%)
ANL 8.45 Decreased By ▼ -0.04 (-0.47%)
AVN 75.82 Increased By ▲ 0.02 (0.03%)
BOP 5.15 Decreased By ▼ -0.09 (-1.72%)
CNERGY 4.41 Decreased By ▼ -0.01 (-0.23%)
EFERT 81.30 Decreased By ▼ -0.33 (-0.4%)
EPCL 49.29 Decreased By ▼ -0.41 (-0.82%)
FCCL 12.40 Decreased By ▼ -0.39 (-3.05%)
FFL 5.51 Increased By ▲ 0.01 (0.18%)
FLYNG 6.82 Increased By ▲ 0.09 (1.34%)
FNEL 4.68 Decreased By ▼ -0.02 (-0.43%)
GGGL 9.27 Increased By ▲ 0.85 (10.1%)
GGL 14.88 Increased By ▲ 0.93 (6.67%)
HUMNL 6.18 Increased By ▲ 0.10 (1.64%)
KEL 2.57 Increased By ▲ 0.01 (0.39%)
LOTCHEM 27.73 Increased By ▲ 0.08 (0.29%)
MLCF 23.57 Decreased By ▼ -0.22 (-0.92%)
OGDC 71.91 Increased By ▲ 0.81 (1.14%)
PAEL 15.13 Increased By ▲ 0.10 (0.67%)
PIBTL 4.83 Decreased By ▼ -0.07 (-1.43%)
PRL 15.66 Decreased By ▼ -0.32 (-2%)
SILK 1.07 Decreased By ▼ -0.03 (-2.73%)
TELE 8.85 Increased By ▲ 0.03 (0.34%)
TPL 7.34 Increased By ▲ 0.26 (3.67%)
TPLP 19.49 Increased By ▲ 0.23 (1.19%)
TREET 21.08 Increased By ▲ 0.23 (1.1%)
TRG 137.25 Increased By ▲ 0.65 (0.48%)
UNITY 16.30 Decreased By ▼ -0.25 (-1.51%)
WAVES 9.35 Increased By ▲ 0.10 (1.08%)
WTL 1.38 Increased By ▲ 0.03 (2.22%)
BR100 4,164 Increased By 6.3 (0.15%)
BR30 15,350 Increased By 10.3 (0.07%)
KSE100 41,698 Increased By 46.7 (0.11%)
KSE30 15,402 Increased By 22.3 (0.15%)
Markets

Sberbank full-year profit drops 10% as bad-debt provisions surge

  • The credit quality of Sberbank's loan portfolio improved in the quarter, returning to the pre-crisis level, the bank said.
Published March 4, 2021
Follow us

MOSCOW: Russia's largest bank Sberbank missed its pre-pandemic profit target with a 10% decline in net profit last year but said that efforts to contain costs supported profitability.

The coronavirus crisis and a sharp drop in the price of oil, Russia's key export, have pressured the banking sector and prompted lenders to make extra provisions against bad loans in the face of economic contraction and a weaker rouble.

Sberbank on Thursday reported that 2020 net profit shrank to 760.3 billion roubles ($10.29 billion) as provisions against bad loans surged to 412 billion roubles from 92.6 billion roubles a year earlier.

"A year ago we could hardly imagine the challenges we would encounter in 2020: the pandemic, the drop in oil prices, interruption in operations of certain segments of the economy," Sberbank CEO German Gref said in a statement.

The bank said fourth-quarter net profit declined 4.9% year on year to 201.7 billion roubles.

"Sber was able to quickly restore the business once the (coronavirus) restrictions were lifted," Gref said. "The launch of a massive cost optimisation programme helped to support profitability and as a result achieve 16% return on equity."

Sberbank's return on equity (ROE), an indicator of profit generated from money invested by its shareholders, was 20.5% in 2019.

Gref told Reuters this month that Sberbank had no choice but to diversify into non-banking businesses as shrinking margins threaten the survival of traditional banks.

Sberbank's net interest income, however, rose 13.6% in 2020. In the fourth quarter alone, it was up 15% year on year at 426.5 billion roubles.

The credit quality of Sberbank's loan portfolio improved in the quarter, returning to the pre-crisis level, the bank said.

Sberbank had no plans to make additional provisions for 2020 non-performing loans, Gref said last month, reflecting the bank's belief that financial results would improve this year.

Comments

Comments are closed.

Sberbank full-year profit drops 10% as bad-debt provisions surge

Economy: Dar, others take stock of situation

Weekly SPI inflation unchanged on average

Xi calls for oil trade in yuan

Unilateral hike in rates of SEZs’ plots disallowed

FTO orders FBR to release soybean consignments

Russia could cut oil production over West’s ‘stupid’ price cap

Oil rebounds, but still on track for biggest weekly declines

ECs: SBP further tightening data reporting mechanism

Wapda asked to shift troops from Dasu hospital

Matters adjudicated by courts: FBR maintains no data bank