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Nov 20, 2022
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credit fever

credit fever

Photo: Dmitry Feoktistov / TASS

At the end of 2022, the volume of the portfolio of retail loans to the population of the Russian Federation will grow by 10-12%, according to financiers. Nothing good – both for the citizens of Russia and for the banks themselves too. There is every reason to believe that most of the loans issued this year will remain with their recipients, since they simply have nothing to repay their debts with. When the peak of non-payments may happen is not yet clear.

“November shows a positive trend in consumer demand for credit products, we see that the market is recovering after a decline in early October. This allows us to maintain plans for market growth in the second half of the year by about 1.5 times. And in just a year, Russian banks can exceed the landmark mark of 10 trillion. rubles of sales. At the same time, the portfolio of loans to individuals will show an increase of 9%, to 28 trillion. rubles,” reports the Deputy Chairman of the Board of VTB Anatoly Pechatnikov.

Actually, you don’t need to brag here, it’s just right to grab your head, since the situation is simply awful. As of January 1, 2022, the total volume of loans to individuals amounted to 25.1 trillion. rubles, in 2021 it increased by 23.2%. By July 1, 2022, the retail loan portfolio of banks was already 26.4 trillion. rubles. 28 trillion. rubles, by the way, this is an increase of 11.5%, something is wrong with the financier with arithmetic …

But that’s it, the details. If we recalculate the credit burden per household, of which, according to official data, there are about 55 million in the Russian Federation, it turns out that the average family owes more than half a million rubles. If we count according to the Rosstat average salary, which is “drawn” at the level of 55 thousand rubles, then this is the annual income of one adult. Whole! If, however, at a normal average salary, honestly, then it will turn out in a couple of years, or even more. In this case, you only need to repay debts. What to live on is not clear.

And you can calculate in another way. According to the Central Bank, for 114 million of the economically active population of the Russian Federation, including pensioners, the number of citizens with loans is 42 million people, that is, 37%. This is in the middle of this year. Suppose the number of debtors will also grow at a rate of 9-10% per annum, that is, up to 44 million people as of December 31, 2022. And then the average debt will be about 640 thousand rubles. We will not recalculate in annual income, and so everything is clear.

Recently, the President of the Russian Federation Vladimir Putin supported the initiative of the Ministry of Economic Development to increase the availability of out-of-court bankruptcy procedures for “socially vulnerable” citizens – pensioners, the disabled and families with children.

“We have about 20 million people living on incomes below the minimum wage, the incomes of the population have been falling for eight years, in some regions the debt load of citizens has already reached 80%. All this is happening against the backdrop of double-digit inflation and rising unemployment. The fact that the Ministry of Economic Development is dealing with the issue is an obvious signal – the authorities have come to realize that this is a bad situation not with the issuance of loans, but with economic problems, ”says the president of the Aspect Center for Social and Political Research Georgy Fedorov.

On the one hand, this is, of course, good. In a sense, for citizens who have taken out loans, but they have nothing to pay with and have no valuable property. However, if mass bankruptcies begin, this will inevitably hit the domestic financial system. The margin of safety which leaves much to be desired. On the deposit accounts of citizens, it seems like 33 trillion. rubles, and if something goes wrong, they can “burn out”.

However, according to the State Corporation “Deposit Insurance Agency” (DIA), 86.3% of deposits do not exceed 100 thousand rubles. That is, it can be 5 thousand rubles, and 10 thousand rubles. The population of the richest country in the world is very poor, the incomes of citizens are rapidly declining, therefore, statistics on countless trillions of deposits must be trusted with caution. It is not very clear why they are growing against the background of the general impoverishment of people …

The growth of loan defaults, on the contrary, in this situation is quite a natural phenomenon, and it worries bankers very much. Only crumbs of information reach us.

“The number of auto loan agreements that went into arrears in September increased by 18.7% compared to August. This is the largest increase in the number of problem contracts since February this year. The volume of delay up to 30 days in this segment added 12.9%, reaching 569.1 million rubles,” the Scoring Bureau says.

There are not very many car loans approved now, this market has fallen by more than 40%, and not everyone has always been able to get such a loan. So more than half a trillion in debt is already very bad. And how much is in the most popular unsecured “consumer” lending? No data (total amount of delay in dynamics). But there are many, many, many bad debts. A trillion rubles of delay in the aggregate was completed more than a year ago, now the figure is “under the stamp”. Estimates are different – from one and a half to three trillion rubles.

And at any moment it can jump at times. According to the Bloomberg forecast, in the first quarter of 2023, the Russian economy could fall by 8%. And here the agency’s analysts are by no means alone with such assessments.

What then? If we accept that there are now about two trillion overdue loans – about 7-8% of their total mass – how much will they turn into in March? Here one can only guess.

“The limit of the debt burden of Russian citizens has approached a critical point. Despite the fact that Russians have become less likely to make rash purchases, the debt burden of the population continues to grow,” says the director of the project “For the Rights of Borrowers” Evgenia Lazareva.

So far, everything is going according to plan. Bankers hope for the good, that is, that the income from new loans will more than cover losses from defaults. This is on the one hand. On the other hand, it is impossible to limit the issuance of loans to the population at the legislative level. That is, of course, it is possible, but in the conditions of severe lack of money and the fall of the economy, these same loans still support the people.

According to the data for the third quarter of 2022, the share of expenses of citizens of the Russian Federation on mandatory payments increased to 15.4%. In the fourth quarter it will be much worse, as utility tariffs will be raised immediately by 10%. Plus, by the New Year, people will again gain loans. How much they will take is not clear. But a lot.

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