Russia’s VTB Bank to pay no dividends in 2023 despite record profits

By bne IntelliNews September 12, 2023

Russia’s second-largest state-controlled bank VTB is unlikely to pay any dividends for 2023 despite a record net profit outlook, the CEO of the bank and Kremlin insider Andrei Kostin told in an interview with RBC business portal.

"On dividends for 2023, I think there will probably be no payments," Kostin told RBC, adding that VTB plans to resume payments to shareholders in the future, without specifying the exact timing.

VTB maintained its 2023 bottom line outlook at RUB400bn, while Kostin believes that the bank could beat this guidance after posting a RUB757bn loss under Russian Accounting Standards (RAS) and RUB613bn loss under IFRS in 2022.

As followed by bne IntelliNews, VTB's losses accounted for three quarters of the aggregate banking sector’s loss in 2022, and contrasts with the RUB271bn profit of country’s largest lender state-controlled Sberbank.

VTB attributed the massive losses to foreign currency operations, the loss of its foreign subsidies, creation of large-scale provisions, and higher interest rate risk. VTB is among the most heavily sanctioned Russian banks amid the country’s military invasion of Ukraine, having been put on the SDN list by the US and cut off from SWIFT by the EU.

VTB last paid dividends to shareholders at the end of 2020 in the amount of RUB0.0014 per share making a total payout of RUB18.2bn or 48% of VTB’s annual RAS profit.

#Russia #banking #VTB #dividends #sanctions

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