There was not enough gas to rise – Newspaper Kommersant No. 57 (7502) dated 04/04/2023

Gazprombank (GPB), the third largest systemically important bank, showed the largest decline in net income of all large credit institutions reporting. The weak result was obtained against the backdrop of a five-fold increase in deductions to reserves for the loan portfolio and correspondent accounts. The bank’s capital adequacy also declined amid rapid growth in assets, which exceeded RUB 12 trillion.

The net profit of Gazprombank at the end of 2022 fell 10.5 times, to 9.1 billion rubles, follows from its report under RAS. Among the 13 systemically important banks, four have not yet disclosed their annual reports, but among those that have published this is the sharpest drop in financial results.

Thus, the net profit of Rosbank, MKB, Sovcombank, Sberbank decreased by two to four times. At the same time, the net profit of Rosselkhozbank grew 1.4 times, while Raiffeisenbank and Unicredit Bank grew four times. Earlier, the head of VTB Andrey Kostin announced the bank’s losses for the last year, and the former head of FC Otkritie Mikhail Zadornov estimated the bank’s profit at 40 billion rubles, twice as low as the previous year.

Among the largest banks controlled by Russian owners, Gazprombank is in a special position. There are no US or EU blocking sanctions against him. In March 2022, it received the status of an authorized bank for paying in rubles for gas supplies to unfriendly countries. At the beginning of 2023, due to the refusal of American banks to make payments, GPB ceased to carry out dollar transactions (see Kommersant dated January 25). However, the corset remains wide, customers can make payments in UAE dirhams, euros, Indian rupees, Turkish liras, Chinese yuan, currencies of the CIS countries, etc.

For GPB, last year’s financial result was the weakest in seven years. In 2015, the bank received more than 34 billion rubles. loss, but then regularly brought a net profit in the amount of tens of billions of rubles.

At the same time, last year the bank sharply increased interest income – from 455.3 billion to 780.2 billion rubles, primarily due to the growth of the loan portfolio (1.8 times, to 690.4 billion rubles). However, due to large-scale additional provisioning, net interest income decreased by 1.5 times, to RUB 121.2 billion. Fee and commission income decreased slightly – from 64.8 billion to 61.4 billion rubles. Gazprombank did not respond to Kommersant’s request.

The bank’s profit decreased primarily as a result of an increase in deductions to reserves, which was the result of a deterioration in the operating environment in 2022, explains Valery Piven, Managing Director, Head of the Financial Institutions Ratings Group at ACRA. Ludmila Kozhekina, Director of Banking Ratings at Expert RA, among the key factors in the decline in profits, notes an increase in deductions not only to reserves for loans and correspondent accounts in banks (by 5.5 times), but also to reserves for other losses, which increased by 14 times ( up to 21 billion rubles).

In addition, the loss from operations with financial assets affected, experts say. Thus, according to the reports, the bank received a large loss in the amount of more than 40 billion rubles from operations with securities. At the same time, the growth in net interest income “could not compensate for the growth in deductions to reserves,” Ms. Kozhekina notes.

At the same time, Gazprombank’s assets grew by almost 1.5 times in 2022, to RUB 12.4 trillion. It is significant that at the beginning of last year, assets of more than 10 trillion rubles. were only at Sberbank and VTB. According to Valery Piven, the bank showed a very strong growth in its loan portfolio, which could affect the value of assets at risk and lead to a decrease in capital adequacy ratios.

In particular, the H1.0 ratio (total capital adequacy) of GPB against this background decreased by 2.3 percentage points, to 9.5% (with a minimum level of 8.0%). For example, MKB has 12.2%, Sberbank and RSHB have almost 15%, Rosbank has 17.5%, Raiffeisenbank has more than 30%, and Unicredit Bank has almost 35%. The decrease in GPB’s capital adequacy ratios, Ms. Kozhekina believes, is caused by the outstripping growth of assets under risk in comparison with the dynamics of capital.

Olga Sherunkova