ACRA has released a fresh survey on the banking system. Nothing new there especially no figures were announced, but interestingly, a special emphasis was made on the growth of the share of the state.
Now in the banking sector, the state’s share reaches 70% is high throughout the economy, even the oil and gas sector can boast of only 66%. Strong further growth will be gone, but the figure will continue to rise.
Against this background, competition escalates between state-owned banks, but the reliability factor will not play a role.
The assets of banks in 2018 will grow by only 5.2%, while profit and profitability generally will not grow.
So-so results of the struggle of the Central Bank for the banking sector, its stability and transparency. So far, at least, the results are only disturbing. Stability increased, but the question is price.
Banks that can get into PCBS, still a lot, so the state share will obviously increase. 80% we will see in the next two years, but in 4-5 years, anything is possible. During this time, the Central Bank promises to achieve stability of rehabilitated banks and start to sell them. Here, apparently, will state-owned banks. That is, nothing will change, banks will continue to expand. Hope for privatization in such circumstances is pointless.
PS by the Way, I wonder how the controller will react on such “liberties” from the supposedly independent Agency. On the other hand, critics of the Central Bank is almost there, all very neutral and the accents… well, it is necessary to attract attention and to increase the citation index. The Agency was created after the decline of the sovereign ratings of the Russian Federation, but now, given the return to the investment level, ACRE becomes useless and even harmful toy. Expensive services, the almost complete lack of alternatives, but all banks that have to buy (pension funds, for example, cannot be stored in banks, where there is no acre or ratings of Expert RA (about this Agency is generally a separate conversation)). VTB was dissatisfied with the actions of the AKP – went to Expert RA, but, in fact, it’s a waste of resources if there are ratings of Moody’s, Fitch, S&P in a stable geopolitical situation. Without sanctions and a downgrade to junk level ACRES would have never showed up, so they want to show their importance and the fact that they do not depend on the will of the leadership of the Central Bank, unable to resist the pressure from the state banks. But an ACRE was a necessary measure, and the state can fairly raise the question, why do you need the Agency, the ratings of which have no practical value (except for the artificial requirements of the Central Bank and the Ministry of Finance that are easy to change), but which often “muddies the water”. The growth of state presence in the sector, as it turned out, threatens not only private bankers.