Most Russian developers remain stable, several companies experiencing problems owing to debt burden - Central Bank

MOSCOW. Feb 13 (Interfax) - Most major Russian developers and the sector as a whole are resilient, and the problems facing individual companies are not systemic, Central Bank Governor Elvira Nabiullina said on Friday at a press conference.

"We are monitoring the financial condition of major developers and see that most of the largest companies and the sector as a whole remain stable. While some companies are experiencing problems, these are not systemic, and the source of the problem is not the sector's evolving situation, but rather debt accumulated in previous periods. The housing market, as you can see from the figures, is quite stable. The risks many discussed at the beginning of last year about a decline have not materialized. Housing sales are growing, both in value and volume," Nabiullina said.

Nabiullina estimates that financing rates for projects are very moderate at just over 10% on average.

As became known in early February, the Samolet developer had approached the government with a request for state support in the form of a preferential loan or other stabilization instrument totaling 50 billion rubles, with shareholders willing to provide a blocking stake or more in the company with the right to repurchase. The company said that seeking government support to optimize the group's financing under the current tight monetary policy is normal market practice for many sectors.