In brief

• Problematic loans to Russian companies reached RUB 13.3 trillion in early September, accounting for 13.3% of the corporate loan portfolio.
• More than half of these loans have no collateral at all, which increases the risk of losses for banks.
• The data comes from the Central Bank of Russia and was analysed by the outlet The Bell.

Problematic loans at a record level

As of 1 September, the total value of loans granted to Russian companies that were classified as problematic amounted to RUB 13.3 trillion, or about PLN 588.7 billion (Bomba z opóźnionym zapłonem w rosyjskich finansach. Banki w Rosji mogą ponieść gigantyczne straty – Onet). This represented 13.3% of the entire corporate loan portfolio. Loans are considered problematic when the companies that received them have difficulty servicing their debt or have applied for restructuring, for example a deferral of repayments.

Lack of collateral increases the risk

According to an analysis by the Russian outlet The Bell, based on statistical data from the central bank, more than half of the problematic loans on banks' balance sheets are not secured by any assets. This means that if they are not repaid, the bank has nothing to seize in order to recover even part of the money, so potential losses may be significant.

What this means for the sector

The situation may affect the financial results of the banks that granted such loans. The scale of the problem stems from the large share of problematic loans in companies' portfolios and the absence of collateral for a substantial part of them. The material does not say how quickly write-downs may appear or which banks are most exposed.

Key figures

• Problematic loans to companies: RUB 13.3 trillion
• Share of the corporate portfolio: 13.3%
• Loans without collateral: more than half of the problematic ones

Read also

• Debt among Russian companies themselves has reached its highest level in over 20 years