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Russia's Sberbank Posts 74% Jump in Third-Quarter net Profit

MOSCOW, Oct 29 (Reuters) - Russia’s largest lender Sberbank reported a 74% jump in third-quarter net profit driven by a revival of corporate and consumer activity after the end of lockdowns spurred by the coronavirus pandemic.

The crisis put pressure on Russia’s banks, prompting them to create extra provisions against bad loans amid economic contraction and a weaker rouble.

After reporting a more than 33% drop in net profit in the second quarter, state-controlled Sberbank, or Sber, said its net profit bounced back in July-September to 271.4 billion roubles ($3.44 billion).

This compares with 156.1 billion roubles a year earlier and 166.7 billion roubles in the second quarter of 2020.

Revival in business and consumer activity in the third quarter amid fewer COVID-19 restrictions and state measures to support business and households led to a significant growth in the Sberbank’s loan portfolio and its transactions, finance chief Alexandra Buriko said in a statement.

Sber said its net interest income rose 16.2% to 411.3 billion roubles.

Third-quarter net credit loss provisions against bad loans more than doubled to 63.3 billion roubles from a year earlier, but nearly halved from 126.5 billion roubles seen in April-June this year.

Sberbank, which paid 50% of its net 2019 profit in dividends this year, gave a cautious forecast for the remaining period of 2020.

“We expect that business activity will somewhat slow in 4Q as the pandemic continues,” Buriko said.

$1 = 78.87 roubles

Reporting by Andrey Ostroukh and Tatiana Voronova; Writing by Andrey Ostroukh Editing by Tomasz Janowski

Source: Reuters

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