Russia’s VTB eyes rebound after sanctions-hit $7.7bln loss

VTB expects to bounce back from a sanctions-induced $7.7 billion loss last year to post record profits in 2023, Russia’s No. 2 lender said on Wednesday, boosted by the purchase of rival Otkritie Bank and a profitable start to the year.

CEO Andrei Kostin has blamed the bank’s losses squarely on Western sanctions against Russia’s financial sector. VTB, heavily exposed to international markets and with more than 20% of its loan portfolio in foreign currencies, was particularly hard hit in the early stages of the conflict in Ukraine.

Wednesday’s results, published under international reporting standards for the first time in more than a year, reveal hefty losses on foreign exchange and precious metals operations as well as huge provisions.

VTB posted a net loss of 612.6 billion roubles ($7.73 billion), down from a record profit of 327.4 billion roubles in 2021.

Provisioning costs increased 343.3% to 514.3 billion roubles and net interest income slumped 50.3% to 321.0 billion roubles.

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