OREANDA-NEWS. September 03, 2009. CBR released July banking sector statistics. Russian banking assets remained stagnant at RUB27.8 trln (+0.2% MoM). On the funding side, retail deposits posted another 1.9% MoM increase, reported the press-centre of OTKRITIE FC.

With a minor decline in corporate accounts, banks slowed the pace of returning CBR funds: in July they accounted for 7.0% of assets (7.2% for June, and 13.3% at the end of January). Banks' capital increased by 1.8% MoM to RUB4.2 trln.

View: Although still a modest decline, the stagnation of loan portfolios could be viewed positively compared to the corresponding figures for May (1.9% and -1.4%) and June (-1.1% and -1.2%). The stabilization of lending portfolios comes on the back of state banks' efforts, but also indicates that other banks are slowing shrinking.

Meanwhile, the share of securities on banks’ balance sheets has increased from 10.5% in June to 11.4% in July, which also means that large companies were able to get financing through bond markets. The growth in deposits comes in our view on the back of high interest rates and the population’s increasing propensity for saving in the face of income uncertainty. The growth in capital is a positive, especially after two months of shrinking capital, but we believe this is mostly due to some capital injections and subordinated loans.