20 March 2024

Russian Agricultural Bank has published the summary consolidated financial results for 2023 in accordance with International Financial Reporting Standards (IFRS).

In 2023, Russian Agricultural Bank Group (RusAg, the Group) achieved significant results in all its business directions. At the end of the year, the Group earned a record net profit in the bank’s history that totaled RUB 31.8 billion, which is ca. 5 times over the result of the previous year.

The Group’s assets as of 31 December 2023 amounted to RUB 4.746 trillion, having increased by RUB 488.6 billion (+11.5%) over the year.

The core business direction of RusAg and the Group is providing financial support to agribusiness clients, within the framework of which the bank has supplied agricultural producers with uninterrupted lending during 2023. RusAg’s agribusiness loan portfolio increased by RUB 137.6 billion (+6.9%) and, by the beginning of 2024, amounted to RUB 2.14 trillion. The volume of loans provided for seasonal work add up 7.9% to RUB 822.4 billion, compared to the end of 2022. Russian Agricultural Bank is the core bank of the agricultural industry, providing a third of agribusiness lending and about 70% of financing seasonal work in the country.

The Group’s loan portfolio (before provisions) increased by RUB 306.1 billion (+9.0%), compared to the end of 2022, and amounted to RUB 3.719 trillion. Including the growth of the corporate loan portfolio (incl. loans at fair value through profit or loss) by RUB 328.4 billion (+11.6%), during 2023, up to RUB 3.152 trillion. Retail loan portfolio slightly declined (-3.8%), which corresponded to the risk approaches of the Group and the priority of lending to agribusiness clients.

Customer confidence in RusAg ensured the inflow of depositors’ funds. Retail deposits and customer accounts increased by RUB 267.5 billion (+16.1%) and amounted to RUB 1.931 trillion. At the same time, corporate customer accounts (including funds of state authorities) grew by RUB 23 billion (+1.4%), compared to the end of 2022, up to RUB 1.723 trillion. In general, customer accounts increased by 8.6% (+RUB 290.5 billion) and totaled RUB 3.654 trillion.

Loan-to-deposit ratio (LTD) stood at 102% as at 31 December 2023.

In 2023, the Group significantly increased its operating efficiency. The main driver of profit growth was interest income: by the end of 2023, net interest income amounted to RUB 129.2 billion, having increased by 75.6% as compared to 2022 (against RUB 73.6 billion). Return on equity grew from 2.7% to 11.0% compared to 2022. Return on assets – from 0.2% to 0.7%, respectively. It is important to note that these growth rates are not the result of a “low base” in comparison with the turbulent 2022 – during this period, RusAg was able not only to maintain previously achieved positions, but also preserved the growth rate of income and asset quality.

“The agricultural industry is gaining momentum: in recent years, agribusiness has become one of the leading sectors of the country’s economy. RusAg, as the core bank of the industry, also demonstrated high results over the past year: we received record profit, which allowed us to strengthen the capital of the Group. We managed to maintain the pace of support for the Russian agribusiness by increasing loan portfolio. The Bank improved its resource base by diversifying it by sources and terms, and increased operating income. The strong financial results of last year will become a new incentive for us to grow and develop both the Bank’s own business and its subsidiaries, and the ecosystem. After all, our main competitor is ourselves,” said Kirill Levin, First Deputy Chairman of the Board at RusAg.

The Group’s net interest margin for 2023 was 2.9%, up from 1.9% in the previous year. The ratio of operating expenses to net operating income before provisions (Cost/Income) improved compared to the end of 2022 and amounted to 48%.

The Group’s equity (according to IFRS) as of 31 December 2023 amounted to RUB 298.1 billion, having increased by 6.8% since the beginning of the year, primarily due to the growth of net profit. Capital adequacy ratio (N1.0) (under the Bank of Russia requirements) stood at 14.9%.