Sberbank Revises Credit Growth Plans

Sberbank is no longer targeting lending growth and will concentrate instead on the quality of its loans, Kommersant reported Friday.

The move could bode ill for Russian companies, which have some $120 billion to $200 billion of foreign debt to pay back by the end of 2009, and are hoping to find funding at home as the credit crunch has virtually closed off the possibility of borrowing abroad.

Kommersant quoted a letter from Sberbank CEO German Gref sent to employees, which represents a major shift in the business strategy of the banking major that accounts for one-quarter of Russian banking sector assets.

Central Bank first deputy chairman Alexei Ulyukayev said Thursday that the country's credit growth should be 35 percent to 40 percent this year, down slightly from about 50 percent in 2007.

Sberbank's corporate credit portfolio grew about 20 percent in the year to Aug. 1, to 3.6 trillion rubles ($140.6 billion).