Expert RA rating agency has published its annual Ranking of the Largest Banks Lending to SMEs Based on the Results of 2024. Center-invest Bank from Southern Russia took rated fifth in terms of volume of issued loans alongside with high quality of the SME loan portfolio.
In 2024, Center-invest Bank lent 117 billion roubles to its clients for the development of their businesses, 82% of which were allocated to SMEs.
"It is necessary to take into account that the 17% growth of the loan portfolio of Russian banks was by 80% achieved by lending to ‘Quasi SMEs1’, that is, large borrowers that formally meet the SME criteria. Accordingly, the loan portfolio for the actual small businesses on the market grew only by 4%, and the volume of issued loans issued increased only by 7%," comments Vasily Vysokov, Chairman of the Center-invest Bank’s Board of Directors, Professor, Doctor of Economics, "Center-invest Bank, based on a business model of sustainable, client-centric banking, increased the volume of issued SME loans issued by 13% in 2024."
Experts note a decline in the quality of SME loans: the share of overdue SME debt in the banks’ portfolios amounted to 4.4% (and, excluding the "quasi-SMEs", to 6%). At the end of 2024, the share of overdue payments within the SME loan portfolio at Center-invest Bank was 1.4%.
The business plan of Center-invest Bank approved for 2025 takes into account the forecast for a decrease in the growth rate of Russia’s real GDP from 4.1% to 1.5%, and expects an increase in the SME loan portfolio by 11% while maintaining the high quality of the same.
Center-invest Bank effectively manages risks and practices a conservative approach to lending. A high-quality loan portfolio allows the bank to maintain low interest rates without using them as allowance for excessive risks, and the volume of overdue debt in the SME portfolio has been steadily decreasing over the past three years. This is in line with the principles of sustainable client-centric banking: developing long-term trusting relationships with clients rather than making immediate profits.
1 According to the Bank of Russia, "quasi-SMEs" include large borrowers with a total debt of more than 8 billion roubles and borrowers with escrow accounts (codes "E" or "Zh", or "C") under three sections of OKVED 2 (Russian Standard Industrial Classification of Economic Activities-2): section F "Construction"; section L "Real Estate Transactions"; section M "Professional, Scientific and Technical Activities", including the provision of project management services in construction with use of escrow accounts (codes "E", or "Zh", or "C").