At the beginning of the pandemic, we launched a preferential refinancing programme for banks lending to SMEs. Now Mr Aksakov has suggested that we review these decisions. But I would like to remind you that we needed to ensure that small businesses had access to funding as fast as possible during the pandemic. 409 billion rubles were taken out of the limit. But I would like to say that this program will be phased out gradually over the course of a year. However, at the same time, we are extending the operation of this instrument (it will be possible to obtain preferential refinancing until September 30). Why? Because rate cuts after the transition to a loose monetary policy and measures of government support for SMEs bring about sufficient lending potential in this segment. It really was a rapid-response anti-crisis measure. How do borrowers feel now? The restructuring programmes have helped them withstand the shock of Q2. Undoubtedly, it is important to understand that some borrowers may not cope with the repercussions of the epidemic, and we can see that banks have already been carefully evaluating borrowers’ business and loans have been available for more efficient businesses. And despite the stress, there has not been significant loan impairment as was the case in 2014– 2015. The share of non-performing and bad loans in H1 2020 in the corporate portfolio increased slightly (by 0.1 p.p. to 11.1%).
The business loans segment accounted for most of the improvement in 2022, with an incipient increase in the households segment. In the sectors hardest hit by the pandemic, the share of Stage 2 loans fell very sharply (by 3.4 pp to 14.6%), albeit holding above the average for lending to non-financial business activities (9.8%). - Forborne exposures were down by 0.8 pp to 4.2% of total lending to the resident private sector, having declined by 16.5% since end-2021, when they reached pre-pandemic levels. - The proportion of ICO-backed credit classified as Stage 2 shrank by 0.8 pp to 19.6% of the total. However, non-performing assets increased by 78.8% in 2022, lifting the NPL ratio to 7.1% (up by 3.6 pp on 2021). The reduction in the size of this portfolio (11.3% in 2022) accounted for 0.8 pp of the increase in the NPL ratio. - Foreclosed assets decreased by 14.5% in 2022, to stand at € billion at December. Since the start of the pandemic, these assets have fallen by more than € billion (36%), on top of the declines recorded in the years leading up to the health crisis. Profitability  6  - Return on assets (ROA) fell by 2 bp in 2022, although this drop owed mainly to lower extraordinary income compared with 2021. Excluding these items, ROA increased by 8 bp. - This performance mainly reflects the improvement in net interest income, which increased by 17.1% year-on-year due to the uneven passthrough of higher interest rates to loans and deposits.