In February, the population took out loans and saved at the same time

According to a new report from the Bank of Russia on the development of the banking sector, in February the monthly increase in mortgage lending amounted to 0.7% compared to 0.6% in January. “This generally corresponds to our expectations for a cooling of the market (7–12% growth for 2024),” the Central Bank notes. At the same time, in February there was a noticeable increase in the issuance of both preferential and market mortgages – by 15% and 40%, respectively. “The high dynamics of market mortgage issuances is mainly explained by the effect of a lower base in January. The tightening of the conditions for mass preferential mortgages (increasing the down payment to 30% and reducing the maximum loan size to 6 million rubles) from the end of 2023 could also play a certain role: some borrowers were forced to reorient themselves to market programs,” the regulator notes.

The growth of consumer lending in February remained at the level of January (plus 0.9%) – against the backdrop of increased consumer activity. The indicator remains above the Central Bank’s forecast for the year (growth by 3–8%). “Previously, such changes were largely ensured by credit cards, where rates have always been quite high and therefore less sensitive to changes in market rates,” the Central Bank explains, expecting that macroprudential limits will have a restraining effect on lending.

Against this background, the growth of household funds in banks amounted to an impressive 1.1 trillion rubles. (plus 2.5%) after a moderate outflow in January (minus 0.7%). “This is atypical for February and is a record for this month,” the Bank of Russia records, explaining what happened by high deposit rates (14.79% at the end of February) and the February indexation of social and insurance payments by 7.4%. Ruble deposits of the population increased both on current accounts (by 674 billion rubles, by 5%) and on time deposits (by 508 billion rubles, by 1.8%). The amount in escrow accounts remained virtually unchanged (minus RUB 11 billion, minus 0.2%) after a moderate decline in January (minus 1.1%).

Let us note that in March, citizens’ spending, both according to Sberindex and according to the Romir company, remained elevated and grew in real annual terms. The Central Bank expects that the peak effect of the key rate increase will occur in the second half of 2024.

Artem Chugunov