Russia’s biggest bank suffers 78% collapse in profit as sanctions bite


Russia’s dominant lender Sberbank reported a nearly 80% plunge in 2022 net profit Thursday as sweeping Western sanctions rattled Russia’s financial sector in what the bank’s CEO called “the most difficult year.”


was releasing results under international reporting standards for the first time in a year. Russian authorities ordered banks to limit disclosures and dividend payments last year as Moscow tried to maintain financial stability.

Sberbank’s annual profit came at 270.5 billion rubles ($3.57 billion), down 78.3% from 2021 and around 30 billion rubles ($396 million) lower than what it reported for 2022 under Russian accounting standards.

CEO German Gref said this year’s profits should be close to the record 1.25 trillion rubles ($16.5 billion) earned in the “pre-crisis year.”

“Our business model passed another strength test,” Gref said, adding that the bank would now resume consideration of dividend payments on its 2022 results, with a decision due in March.

The Russian finance ministry expects the majority state-owned lender to pay out 50% of its 2022 profits as dividends.

Sberbank’s resilience in the face of sanctions helped Russia’s banking sector recover from a loss-making first half in 2022.

Other lenders, such as No. 2 bank VTB, have not fared so well and Russia’s central bank warned of “systemic risks” to the sector last week as lenders scramble to turn a profit.

Banks are now jostling for business from the state — particularly as the defense budget swells — and the country’s big companies.

“We implemented an anti-crisis plan: we radically revised our priorities, introduced the strictest savings measures, closed and sold international businesses and also made all the necessary provisions for the loan portfolio and blocked assets,” Gref said.

Sberbank said savings exceeded 240 billion rubles ($3.2 billion), with operating costs down 1.5% year-on-year. The bank recovered $6 billion in foreign currency from abroad since sanctions were imposed, Gref said.

From CNN

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