Russian VTB Bank keeps 21% ROE under IFRS in 10M24

By bne IntelliNews December 2, 2024

Russia’s second-largest state-controlled bank VTB posted RUB30bn net profit for October 2024 under IFRS, making a 14% return on equity. For 10M24 overall ROE remained above 20% at 21% with a bottom line of RUB405bn.

While VTB’s capital adequacy ratio (N20.0) remained at 9.1% in October (down 1.5 percentage points year on year). 

As followed by bne IntelliNews, the core capital adequacy ratio (N1.1) of VTB fell to 5.31% at the beginning of September 2024, close to the regulatory minimum of 4.5% excluding surcharges. Analysts suggested that the bank would have to reorganise to address the capital problem, but since then the bank started improving its capital position.

Following the publication of IFS results VTB maintained its profit forecast for 2024 at RUB550bn, a substantial part of which (RUB108bn) is still expected to come from recoveries and restructuring of blocked and sanctioned assets.

In October VTB’s loan portfolio grew by 1.5% month on month in October (14.7% ytd), deposits were up by 1.4% m/m (16.1% ytd). Net interest margin (NIM) declined to 1.1% in October (1.9% in 10M24) on the back of faster growth in funding costs, accompanied by a notable decline in net interest income, Renaissance Capital commented.

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