To capitalize on the crisis: why began to grow potrebkreditovaniya

Lower rates, more loans

After a long downturn in the consumer credit market showed signs of recovery, States the major participants of the Russian banking market. “The portfolio of consumer credits of Sberbank stopped falling and gradually moves to growth. On August 1, the volume of granted loans amounted to $ 1.38 trillion rubles”, — said Tuesday, August 23, the Director of Department of retail non-transactional products Sberbank Natalia alymova.

Sberbank said that in the first seven months of 2016 consumer loans were issued totaling over $ 420 billion rubles, which is more than 1.5 times the issuance of the same period of 2015. Growth in Bank lending is associated with a reduction in interest rates. In may the savings Bank has lowered rates on consumer credits 1.1–4.1%, and in July, launched a special promotion for customers. As a result, according to Alymova, the number of applications from borrowers grew by 15%, and the average size of loans has increased to 70 billion rubles.

The stabilization of the market of consumer loans see other major participants in the retail market. “The second half of 2015, we have restored the volume of sales at the level of the best results in 2013-2014 and yet noticeable restrictions from the market do not experience”, — said Vice-President, head of retail products, e-business and CRM VTB Bank, Ivan Pyatkov.

In another part of VTB group, Bank VTB24 noted that in July 2016, this “daughter” gave 1.7 times more loans than in July 2015. The portfolio of VTB24 loans to individuals as at 31 July 2016 made up 1.63 trillion “growth Drivers — loans in cash,” — said the representative of the Bank. In July, VTB24 has issued loans for a total amount of 27 billion rubles (in July 2015 and 13.3 billion rubles). The Bank also noted the growing interest of citizens to the refinancing of loans of other organizations. In July VTB24 2.6 million refinanced loans by 1.2 billion rubles, which is more than the entire first quarter of 2016.

Alfa-Bank also say that the POS-crediting market began to recover after the recession the last two years. “We also expect a seasonal revival of the market”, — said the head of business development mass segment of the credit institution Alexei Yablokov. He noted that, according to the Frank Research Group, the Bank’s share in the market of consumer crediting is of 14.84%. “We plan to maintain our market share,” added the banker.

The delay grows

The market is recovering against the background of preservation of volume of delay, experts say. Russian banks in July was faced with a record volume of overdue consumer loans, according to Bloomberg, citing the U.S. credit rating FICO. The FICO index, which is calculated based on the data of National Bureau of credit histories (nbki) by the volume of consumer credits overdue more than 60 days, for the second consecutive year at 16%. In July it was the highest since the inception of the index in 2007.

This indicator captures the “new normal” in the sector, the Director of FICO in Russia and the CIS Eugene Samaritan. “This “new normal” reflects the evolution of Russian credit market, as lenders have shifted from issuing secured loans to credit cards and other products, the sale of which carries higher risks,” he explained to Bloomberg.

Consumers are more likely to feel the brunt of the longest in the last 20 years of recession: on the background of the collapse of the ruble decreased the level of wages, increased interest rates, and inflation during the past year was kept at two-digit levels. According to estimates of the NCB, despite the fact that the economy by the end of the year can return to growth, falling real incomes will continue to exert pressure on the ability of households to service their debts.

S&P analyst Sergey Voronenko added that once the economy returns to growth, the share of overdue loans will start to decline. “Most of the risks with consumer credits in 2015 and 2016 were associated with falling and loss of profit, new loans are not issued EN masse, and banks in case of problems, had to increase reserves. Now we see that the volume of retail portfolios increases and the percentage of overdue loans may decline to the end of the year,” he added.

However, according to the National rating Agency (NRA), at the beginning of July, the dynamics of overdue loans in the consumer lending segment was different: delay on credit cards declined, the mortgage remained unchanged from the beginning of the year, and auto loans and consumer loans increased, but only slightly. “In General, the segment we observe a stabilization of delay throughout the segment she does not exceed 11%. Over the past year, banks have practically curtailed lending to the street,” actively disposed of troubled assets and clean balance sheets, so in the short term we do not expect significant growth of overdue debt, and next year in the absence of external shocks to the expected start of the trend to the progressive reduction of arrears in the consumer Finance sector”, — said the Director of Department of financial ratings of the NRA Karina Artemyev.

To earn on crisis

Restoration of volumes of retail lending is already affecting the financial performance of retail banks. According to the report, the company on August 1, 2016, the majority of market participants showed a significant improvement of the results. The leaders of VTB24, who received seven months of the year 2016 net profit of 18.29 billion rubles. against a loss of 12.14 billion RUB over the same period of 2015. Tinkoff Bank five times increased profit, earning in January—July 2016 3.83 billion rubles. “We are seeing a gradual recovery in demand for consumer loans since the autumn of last year”, — said the representative of Tinkoff Bank.

As of August 1, 2016, the net portfolio of consumer credits Tinkoff Bank amounted to 91 billion rubles, which is 25% more results of the same period last year. In July, net portfolio gained 2 billion rubles.

Bank home Loan in the first seven months of the year 2016 net profit amounted to 1.6 billion RUB compared to 10.2 billion RUB of loss in the same period last year. “Thanks to some recovery in consumer demand amid slowing inflation and stabilization of the dynamics of real income, we note the increase in disbursements compared to last year”, — said the head of strategic communications home Credit Bank Irene shkarovskaya. At the same time, in absolute terms the Bank’s loan portfolio in July decreased by 1.34%, or 148,1 bn). In the credit organization explained that the main reason for the reduction of the portfolio in that amount of disbursements of new loans does not cover the volume of repaid loans. Earlier, representatives of the Bank said that from July began to issue loans to customers off the street. The Bank does not lend to this category of citizens from mid-2013.

In the Mail Bank attributed the growth in consumer lending with the development of a network of service centres in post offices (since the beginning of the year, the Bank opened more than 1 thousand points of presence in 60 regions of Russia), as well as the reduction of the key rate of the Central Bank. Head of development centre of credit products of OTP Bank Roman Lobusev said that the increase in demand for consumer loans contributes to the seasonal factor: in the second quarter, fewer Bank holidays than in the first. According to the Bank, in June—July, the portfolio showed an increase, reaching at 1 August 17,4 billion rubles.

“In July, the volume of loans in the group of the Bank increased by 26% compared to June, which is an absolute maximum value on the monthly dynamics in 2016,” — said the analyst of management of credit products Binbanka Vyacheslav Panteleev. He connects the growth of the consumer not only from decreased rates, but also with a reduction in accumulated debt burden of the population. “The citizens again have the opportunity to issue new loans, especially because the population has accumulated pent-up demand,” he says.

Agree with him managing partner NAFI Pavel Samiev, who notes that after a relative stabilization of the ruble, the citizens have gained confidence that imported goods will go up rapidly. “However, fear a new devaluation of the ruble, so rush to take advantage of favorable rates and to purchase equipment or furniture on credit”, — he explained.

Unstable growth

The experts ‘ forecasts concerning the further growth of the market potrebkreditovaniya is not very optimistic: the majority of bankers believe that to speak about stabilization of retail banking before that. “During the second quarter of 2016, we see a gradual increase in demand for consumer loans in the market, but this is still not enough to restore the market is still declining,” — said Natalya alymova. Her words were confirmed by the statistics of the Central Bank. Although in July, according to Bank of Russia, volume granted by banks to citizens of loans grew by 0.4% and amounted to RUB 10.6 trillion (a growth on the consumer lending market is the first time since the beginning of the crisis), since the beginning of year the volume of retail portfolio decreased by 0.6%. As noted in the review of the Central Bank in the first place is due to reduce the most risky segment of the retail loan portfolio — unsecured consumer lending.

In June 2016, the volume of unsecured consumer loans, according to the regulator, declined 0.2%. The July data, the Central Bank has not yet disclosed.

“In our view, it is possible to speak about situation stabilisation in the retail sector, including the unsecured segment, but not about the new cycle of growth”, — considers the head of group Finance ACRES Kirill Lukashuk. He says that stabilization is associated with the cessation of growth of debt load of the population, the decline of inflation and the emergence of a cautious risk appetite in this segment from individual players. “However, positive dynamics of macroeconomic factors that could determine the steady change in the trend in unsecured lending, has not yet seen” — says the expert.

Bank home Loan recognize that the overall market is not yet fully returned to pre-crisis volumes. “But the opportunities for further growth. Although, of course, such a credit boom, which we saw in 2012-2013, we do not expect neither in this nor in the next year”, — said the representative of the Bank. According to forecasts Panteleeva from the Bank, in the second half of 2016, the volume of consumer loans (cash loans, limits on cards, POS-loans) could increase by 3-4%.

“We see that the number of players using different tactics, go back to the active pace of disbursements of loans. With this in mind, we can predict with the high probability that by the end of this year (for the first time since the beginning of 2015) the trend of falling portfolio of non-earmarked credits will be reversed and we will see stabilization or even slight growth,” — says Roman Lobusev. In Tinkoff Bank expects that the portfolio of consumer credits of the Bank until the end of the year may grow by 15-20%.

“The amount of delay in consumer lending stable in recent months. The delay will decrease when you begin a steady growth portfolios, and while maintaining profit growth in the sector. We see that banks have recently started lending to individuals, responding to the public demand, but also feeling the need to maintain market share. At the same time, we do not see the economic improvements of the situation, growth, and wages. It turns out that the population gets into debt to solve current issues. This may cause the accumulation of future problems in the banking sector”, — said the analyst of Raiffeisenbank Denis Poryvai.