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Share of loans with high debt burden indicator exceeds pre-pandemic level, says regulator

The growth rates on unsecured loans are approaching 20%, Director of the Russian Central Bank’s Financial Stability Department also noted

MOSCOW, June 28. /TASS/. The share of loans with high debt burden indicator [ratio of payments on loans to borrower’s income] has already exceeded the pre-pandemic level, Director of the Russian Central Bank’s Financial Stability Department Elizaveta Danilova told a forum on Monday.

According to the files to Danilova’s report, the share of loans with debt burden indicator of over 100% amounted to 23.5% in Q1 2021 compared to 17.5% in the same period in 2020, and almost 20% in Q4 2021.

"The growth rates on unsecured loans are approaching 20%, whereas the share of loans with high debt burden indicator has already surpassed the pre-pandemic level. In this respect the Bank of Russia has already started returning to the level of surcharges set before the pandemic on unsecured consumer loans and on mortgage loans," she said.

The debt burden of Russian households keeps growing, which is why it is necessary not only to ensure the formation of capital buffers by banks, but also to directly limit the debt burden of citizens through introducing quantitative limitations on granting risky loans, Danilova said.