Published: May 18, 2011
Moody’s survey paints optimistic picture, but firm warns of risks.
Chief financial officers (CFOs) of Russian banks could be overly optimistic about future improvements in asset quality, according to Moody’s Investors Service.
The firm has surveyed 100 CFOs of Russian lenders on their expectations for Russia’s economy and their banks’ financial metrics.
Their responses suggest that the Russian banking system is benefiting from a gradual economic recovery – depositor bases are growing, demand for loans is rising and profitability is improving.
However, the report highlights cases in which Moody’s believes survey responses seem aggressive or out of line with recent trends.
“Moody's views CFO expectations of the extent of asset quality improvement in 2011 as overly optimistic, given our more conservative opinions on the recovery of problem loans and the anticipated performance of restructured loans,” says Eugene Tarzimanov, a senior analyst at Moody’s and author of the survey.