- This content was produced in Russia where the law restricts coverage of Russian military operations in Ukraine
By Elena Fabrichnaya, Alexander Marrow and Marina Bobrova
MOSCOW, March 9 (Reuters) – Russia’s dominant lender Sberbank reported a nearly 80% drop in its 2022 net profit on Thursday as sweeping Western sanctions rattled Russia’s financial sector in what the bank’s chief executive called “the most difficult year”.
Sberbank, which boasts around 107 million active retail clients, was releasing results under international reporting standards for the first time in over a year. Russian authorities had ordered banks to limit disclosures and dividend payments last year as Moscow tried to maintain financial stability.
Sberbank’s annual profit came at 270.5 billion roubles ($3.57 billion), down 78.3% from 2021 and around 30 billion roubles lower than what it reported last month under Russian accounting standards.
Profit under Russian standards for January-February 2023 stood at 225 billion roubles, Sberbank said on Thursday.
CEO German Gref said that 2022 had been a challenging year but the bank would now be able to resume consideration of dividend payments on its 2022 results. Sberbank’s Moscow-listed shares hit a more than one-year high at market opening before easing 0.3% lower on the day.
Net interest income rose 6.6% year-on-year to 1.87 trillion roubles, the bank said, while net commission income rose 15.4% to 697.1 billion roubles. Return on equity (ROE) slumped by 19 percentage points to 5.2%.
Gref said 2023 ROE was expected to reach around 20%, with net interest margin seen in the 5.3%-5.5% range. Profits would return to near pre-crisis levels, Gref said. In 2021, the bank made a record 1.25 trillion roubles in profit.
ANTI-CRISIS PLAN
Russian banks have rallied after an initial hit from last year’s Western sanctions against Moscow, with lenders now jostling for business from the state, particularly a burgeoning defence budget, and the country’s big corporate accounts.
“We implemented an anti-crisis plan: we radically revised our priorities, introduced the strictest savings measures, closed and sold international businesses and also made all the necessary provisions for the loan portfolio and blocked assets,” Gref said in a statement.
Sberbank said savings exceeded 240 billion roubles, with the group’s operating costs down 1.5% year-on-year.
($1 = 75.8500 roubles)
