16 Dec 2009 14:32

Overdue bank loans in Russia will reach peak in coming months - Ignatyev

MOSCOW. Dec 16 (Interfax) - Total overdue debt owed to Russian banks will reach its peak in the coming months and then start to decrease soon after, the Chairman of Russia's Central Bank, Sergei Ignatyev, said while speaking to the State Duma.

"I think that in the coming months total overdue debt on bank loans will reach its maximum, after which it will gradually decrease," he said.

Ignatyev added that much would depend on the speed of implementing a program for providing state guarantees on bank loans.

Lending by Russian banks remains low, Ignatyev stressed. "Total loans to corporate borrowers are largely not increasing. Loans to the population are clearly decreasing," he said.

The main problem, he said, remain the high risk of lending. "The increase in overdue debt on bank loans to non-financial organization stopped in September but started again in October. However, this is generally a low rate," Ignatyev said.