Russia’s two largest banks, Sberbank and VTB, have reported a significant rise in mortgage and consumer loan delinquencies in the first quarter of 2025, according to their IFRS financial statements reviewed by the RBC news outlet.
At Sberbank, the volume of distressed mortgage loans jumped 90% between January and March, hitting 285 billion rubles (approximately $3 billion). The proportion of troubled mortgages in its loan portfolio doubled to 2.6%, the highest level seen since 2022.
Consumer loans also showed signs of strain. Overdue unsecured loans climbed 22.5% to 610 billion rubles, pushing their share in the overall portfolio from 12.4% to 16.1%. Loans overdue by more than 90 days reached 10.4%, the highest level in three years.
VTB did not provide a breakdown of its overdue loans, but its financial report indicated a worsening credit environment. RBC estimates the share of non-performing retail loans at VTB increased from 3.9% to 4.8% during the same period.
Bank executives attributed the increase in delinquencies primarily to high borrowing costs.
“Clients willing to borrow at such elevated rates are also more likely to default, including on 90-day terms,” said Dmitry Pyanov, First Deputy Chairman of VTB, as quoted by RBC.
Sberbank expressed concern at the decline in payment reliability, noting that many defaults involved long-term customers with previously solid payment records.
“In the first quarter, we observed that delinquencies were not limited to new loans. Even clients who had been reliably making payments began to fall behind,” said Taras Skvortsov, Sberbank’s Deputy Chairman and CFO.
Skvortsov also cited the war in Ukraine—referred to as the “special military operation”—as a contributing factor, noting that some borrowers had left for military service.
Financial analysts highlighted a combination of persistent high interest rates and reduced refinancing options as key reasons for the growing strain.
Mikhail Polukhin, head of ACRA’s financial institutions ratings group, told RBC that tighter Central Bank policies have restricted risky lending and curtailed refinancing for vulnerable borrowers.
While these pressures are expected to weigh on household budgets for the foreseeable future, ACRA does not anticipate a full-blown retail lending crisis at this time.
