VTB allowed a foreign borrower to repay the debt at a discount – Kommersant

VTB (MOEX: VTBR) sharply increased spending on provisions for credit losses in August. This was largely provoked by a non-standard resolution of the situation with one of the corporate borrowers. Journalists learned about this from a statement by the first deputy chairman of the board of VTB, Dmitry Pyanov.

Thus, the state bank allocated 31.6 billion rubles to reserves over the past month, while in July – 13.4 billion. Moreover, most of the expenses in August, 24.6 billion rubles, are “serious additional creation”, half of the volume which is “one-time”, Mr. Pyanov noted. “This is a realized credit loss related to the fact that we allowed one of our borrowers from a friendly country to repay cross-border debt at a discount.” The borrower is a resident of a friendly non-CIS country, but is “sensitive” to VTB’s sanctions status, and the currency of the debt was “unfriendly”.

The bank’s standard practice does not involve any discounts when repaying loans. But “the logic of the decision is that the tax structure, the peculiarities of the country, the peculiarities of the courts that are provided for in the credit documentation, our sanction status indicated that other scenarios are associated with a much greater burden, non-obvious results, and money has a time value,” noted Mr. Pyanov.

The cost of risk in August increased due to this incident and ultimately amounted to 1.9% versus 1% in July. VTB’s net profit under IFRS in the reporting month amounted to 25.9 billion rubles. against 35.6 billion in July. At the end of eight months, the bank earned 351.2 billion rubles. Net interest income for this period amounted to 500.2 billion rubles, commissions – 139.6 billion rubles.

About the results of the sector – in the material “Banks have triple trillions”.

Olga Sherunkova