Ruble weakening to affect bank profits; extent must await earnings reports - Sukhov
MOSCOW. Oct 29 (Interfax) - The weakening ruble will affect Russian bank profits, but the actual extent will only be known after banks report results for the first 10 months of the year, Deputy Central Bank Chairman Mikhail Sukhov told Interfax.
"It is totally obvious that the situation on the forex market will affect bank earnings. But allow us to evaluate its effect in October after we have received data about bank balance sheets. I would not want to make a prediction," Sukhov said.
"So far no one has changed the forecasts for the pace of bank profit growth. All assessments of the size of profits can be given after information from the banks on the results of the 10 months is received," he said.
In July, the Central Bank lowered its forecast for aggregate profits at Russian banks in 2014 to 850 billion rubles from 900 billion-950 billion rubles previously. That level of earnings is sufficiently robust from the standpoint of capital and business development, the Central Bank said.
This year, earnings in the bank sector are being affected by increased loan provisioning: bank profits through the first nine months of the year declined 8.8% year-on-year to 685 billion rubles, while loan reserves increased 22.8% compared with the beginning of the year.
