Russian bank, Alfa-Bank, has reported a net profit of 52.2 billion rubles ($526 million) for the first half of the year. The bank’s loan portfolio remained at a consistently high level. In the first quarter, the bank earned $272 million, but has not disclosed its earnings dynamics in comparison to 2022 when its profits slumped due to Western sanctions.
Despite the challenges faced in the first half of the year, Alfa-Bank has significantly strengthened its market position in terms of total assets and capital. The bank’s net interest income in January-June exceeded $1.4 billion, an 84% year-on-year increase, while net fee and commission income rose 13% to $823 million.
Alfa-Bank’s assets increased by 7% during the reporting period to reach $62 billion. This growth can be attributed to a 17% jump in net loan debt. The volume of corporate loans also rose by 21%, including lending to small and medium-sized businesses, which saw an increase of 35% and 22% respectively.
The bank’s deposit portfolio also experienced growth, increasing by more than 7% due to a 15% increase in retail deposits. Alfa-Bank has also seen an increase in the number of customers, with a 9% growth in the first six months of 2023, bringing the total number of customers to nearly 28 million people.
Alfa-Bank stated that it remains committed to its strategy and is actively implementing technological innovations, working with machine learning models, and using advanced analytics in its business processes.
However, the bank has faced challenges in recent years due to international sanctions. Last year, the US imposed sanctions on Alfa-Bank and Russia’s top lender, Sber, in response to Moscow’s military operation in Ukraine. This year, the EU added Alfa-Bank to its tenth sanctions package. As a result, the owners of the sanctioned bank, Mikhail Fridman and Pyotr Aven, were reportedly planning to sell their stakes in Alfa-Bank to escape the blacklist. However, they were recently added to the US sanctions list.
In conclusion, despite the difficulties posed by international sanctions, Alfa-Bank has managed to achieve impressive financial results in the first half of 2023. The bank’s net profit and asset growth highlight its resilience and strong market position. As the bank continues to focus on its strategy and embrace technological advancements, it is poised for further success in the future.