Capital reserve allows Sberbank to operate steadily even in current conditions - CFO

MOSCOW. Oct 23 (Interfax) - Sberbank's capital reserve enables Russia's leading lender to operate stably even in conditions of high interest rates and tight regulation, the bank's senior vice president and CFO, Taras Skvortsov told Interfax.

"We have an internal buffer for [capital] adequacy above the Central Bank's minimum requirements. It allows us to work stably even in current conditions. The tightening of regulation cannot eat up all of this reserve," Skvortsov said.

"There are always challenges, but compared to other banks we have fewer of them," he said. Profit remains Sberbank's main source for topping up its capital, Skvortsov added.

It was reported earlier that Sberbank's net profit to Russian Accounting Standards rose 5.7% to 1.193 trillion rubles in the first nine months of 2024.

The bank's core Tier 1 (N1.1) and Tier 1 (N1.2) capital adequacy ratios slipped by 0.1 percentage point in September to 10.5% and 10.7%, respectively. The calculation of the ratios does not factor in profit for the third quarter of 2024 until an audit is done. The estimated impact that audited profit for the three months will have on the core Tier 1 and Tier 1 ratios is about 0.7 pp. The total capital adequacy ratio (N1.0) rose by 0.1 pp in September to 12.0%.

Capital adequacy is an important parameter in Sberbank's dividend policy. Under its new development strategy to 2026, the bank plans to pay out 50% of net profit as dividends given a total capital adequacy ratio for the group (N20.0) of more than 13.3%.