4 Aug 2009 14:12

Provisions totaled 5.1% of VTB loan book at end Q1

MOSCOW. Aug 4 (Interfax) - Loan impairment provisions stood at 5.1% of the VTB bank's loan book at the end of the first quarter of 2009, Nikolai Tsekhomsky, the bank's chief financial officer., told a press conference.

"The provisions are currently 5.1%. We're talking about all provisions on the bank's balance sheet in relation to the portfolio," Tsekhomsky said, adding that the provisions stood at 3.6% at the end of 2008.

Tsekhomsky also said past-due loans constituted 3.5% of the portfolio as of the end of Q1, not including rescheduled loans.

VTB said in an earnings report that past due loans and rescheduled loans combined grew to 4.3% of the portfolio during Q1 2009, from 2.4% at the end of Q4 2008. The portfolio itself grew 7.5% during Q1 to 2.8 trillion rubles.

VTB has said its guidance is for loan provisions to reach approximately 8% of the loan portfolio by the end of this year. Tsekhomsky said this was still valid.

VTB said in the earnings report that spending on bad loan provisions jumped to 49.2 billion rubles in Q1 2009, from 30 billion rubles in Q4 2008.

In general, Tsekhomsky said the situation with past due and missed loan repayments would depend on the state of the Russian economy. "We're now more optimistic about the economic situation. We're not inclined to expect a non-payments epidemic," he said.

Tsekhomsky said he would prefer not to reveal the forecast proportion of past-due debt in the loan book by the end of the year. "We haven't yet announced the figure and I'd prefer not to name it," he said.