VTB expects record mortgage lending in Russia in 2023

MOSCOW, Apr 26 (PRIME) -- Provision of mortgages may hit a new record in 2023 and exceed the 2021 result of 5.8 trillion rubles if the macroeconomic situation favors it, VTB Bank Deputy CEO Anatoly Pechatnikov told reporters on Wednesday.

“Our forecasts show that Russian banks will issue around 2.7 trillion rubles of mortgage loans in the first half of 2023. It will exceed the result of the first half of 2022 by 46% and the result of the record year of 2021 by 2%. We expect that sales will outperform not only 2022, but the record year of 2021 this year if the favorable macroeconomic situation remains,” he said.

VTB Bank expects its own provision of mortgage loans in January–June to rise by almost 25% on the year and by 4% as compared with the same period of 2021 to more than 536 billion rubles, he said.

The bank also expects car lending to hit a new record in 2023 by growing by 62% on the year and by 4% as compared with the record of 2021 to 1.13 trillion rubles. The restart of the government’s cheap car loan program, higher production of Russian cars, and growth of Chinese cars imports coupled with parallel imports should support the segment, Pechatnikov said.

In January–March 2023, VTB Bank issued about 18,200 car loans worth 22 billion rubles, which is an almost 50% increase as compared with the same period of 2022, he said.

In general, the segment of retail lending should expand by 17% this year to 33.5 trillion rubles including the securitization of loans, he said.

Pechatnikov also said that the share of client deposits in the U.S. dollars and euros with the bank should fall to 7% as of the end of 2023 from 10% as of the beginning of the year, and shrink to zero as of the end of 2025.

At the same time, the share of deposits in the Chinese yuan may expand to 3% from 1% in 2023, with ruble deposits expanding their share to 90% from 88% this year. The combined share of the Chinese yuan and the ruble in the bank’s deposits should grow to 93% in 2024 and to 99–99.5% in 2025, he said.

VTB Bank expects the combined deposit portfolio of Russian banks to gain 6.5% to 39 trillion rubles this year, with VTB’s portfolio of deposits of individuals increasing by 8% to 5.67 trillion rubles.

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