Central Bank kept key rate due to 1.5-fold decrease in business loans

The Bank of Russia kept the key rate at 21% per annum in December, as business lending fell 1.5 times to 5.8 trillion rubles in November 2024. This follows from the regulator's most recent data, which Izvestia studied.

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Explaining the decision to keep the rate, Central Bank head Elvira Nabiullina said at a press conference on December 20 that the growth rate of lending "has slowed down significantly."

"The effects of tighter monetary conditions have already begun to show in November. The growth of the total loan portfolio has slowed down significantly. At the same time, for the first time in a long time, the growth rate of the corporate loan portfolio decreased," she emphasized.

In the course of raising the key rate there was a "delayed effect" - at first resident legal entities and sole proprietorships took money in banks, but the subsequent increase in the cost of credit cooled their interest, said the chairman of the committee "Opora Russia" on financial markets Pavel Samiev.

The banks' requirements to borrowers have also had an impact. Financial organizations understand that "expensive" money creates increased risks of default, said Pavel Semochkin, founder of the survey company "Hectar Group".

The next rate meeting is scheduled for February 14. Most experts interviewed by Izvestia believe that the Central Bank will keep the rate at the same level.

Read more in the exclusive material of "Izvestia":

Measures on the scale: the Central Bank kept the rate due to a 1.5-fold decrease in business loans