Skvortsov: lowering the key rate will support the economy

MOSCOW, October 8 - RIA Novosti. A further reduction in the key rate will support the economy by reducing the debt burden on business and federal budget expenses without the risk of a sharp acceleration in lending, says Taras Skvortsov, deputy chairman of the board and financial director of Sberbank.

Skvortsov spoke at the “Real Future” investment conference in Moscow, organized by SberInvestments.

“If we look not only at the top-level indicators, but at the lending structure, we see that monetary conditions still remain tight. Market credit remains expensive, and a significant part of the observed growth is associated with segments that react poorly to changes in the key rate. Therefore, a further reduction in the rate, in our opinion, can support the economy, reducing the burden on business and the budget without the risk of a sharp acceleration in lending,” Sberbank quoted Skvortsov as saying.

He added that the surge in lending with a reduction in the key rate will be restrained, among other things, by capital restrictions of the largest banks and the continued high cost of funding. “Under these conditions, the effect of a rate reduction may be manifested to a greater extent in alleviating the debt burden of companies and reducing budget expenditures under subsidy programs,” Skvortsov concluded.

According to Sberbank, the dynamics of corporate lending looks significantly more restrained if we analyze the growth structure in detail. Taking into account corporate bonds, the portfolio as of September 1 grew by 13.4% year-on-year. “However, without two large segments that are little sensitive to the level of the key rate, as well as operations that do not actually lead to an increase in the volume of funds from end borrowers, the growth is about 9.7%,” the bank noted.