CBR says it is sticking to countercyclical buffer schedule as banks can handle increase to 0.5%

MOSCOW. April 25 (Interfax) - Russian banks can handle increasing the countercyclical buffer to 0.5% from 0.25% as of July 1, 2025, so the Central Bank of Russia has decided to keep the schedule for setting this statutory ratio, the CBR said in a statement.

"Considering the growth of some bank's capital reserve and the Bank of Russia's reduction of macroprudential buffers in the first quarter of 2025 for mortgages and credit cards in the grace period, all banks will manage to comply with a countercyclical buffer in the amount of 0.5% of risk-weighted assets starting July 1, 2025 if they maintain balanced growth of lending," the CBR said.

The banking sector's capital adequacy ratio rose from 12.5% to 13% in the first quarter, though the growth of capital reserves varied by bank, the CBR said.

The increase of the countercyclical buffer, along with macroprudential buffers for certain types of loans will help make banks more resilient, the CBR said.

A countercyclical buffer is accumulated during periods of rapid lending growth and released in periods of economic stress. This instrument is supposed to increase the banking sector's resilience to possible shocks and limit their impact on lending to the economy.

Amid the ongoing growth of corporate lending, the CBR decided to introduce a countercyclical buffer of 0.25% earlier than previously planned, as of February 1 instead of July 1, 2025. The buffer, which stayed at zero for many years, is now set to double to 0.5% as of July 1.

The CBR previously said it would carefully watch how fast credit activity slows in the coming months, and that it is prepared to revise the deadlines for forming the countercyclical buffer if needed to support banks' ability to ensure balanced growth of lending to the economy.