Sberbank will raise mortgage rates above 18% after the decision of the Central Bank

The largest bank is reviewing rates on housing loans for the third time in a month. The new increase in Sberbank was called “adaptation to market conditions.” On February 28, the Central Bank raised the key rate to 20%

From March 1, Sberbank will raise rates on major mortgage programs immediately by 7.3 percentage points, to 18.6% per annum, RBC was told in a credit institution. The revision of conditions will affect loans for the purchase of finished housing and apartments in new buildings. Rates on preferential mortgage programs will not change, Sberbank specified.

For Sberbank, this is the third round of increasing the cost of mortgages in a month: before that, the conditions for market programs worsened on February 1 and February 18. Taking into account previous revisions, the mortgage rate on market programs at Sberbank doubled over the month. The day before, the bank raised the profitability of savings products: rates on deposits in rubles rose to the level of 16-18% per annum, and on foreign currency promotional deposits – up to 5% in dollars and 4% in euros. According to monitoring data from Frank RG, interest rates on consumer loans at Sberbank have not yet changed: as of February 28, interest on such loans was in the range of 12.1–21.7% per annum.

The revision of interest on mortgage loans in the state bank was explained by “adaptation to market conditions.” On February 28, at an extraordinary meeting, the Bank of Russia raised the key rate by 10.5 percentage points to 20%, a record level in the history of Russia. The regulator decided to take such a step in order to maintain “financial and price stability and protect citizens’ savings from depreciation,” the Central Bank said in a comment.

On February 21, President Vladimir Putin announced the recognition of the independence of the Donetsk and Lugansk People’s Republics, and on February 24 he announced the start of a military operation in Ukraine. In response to Russia’s actions, the authorities of the United States, the European Union, Great Britain and other countries began to impose new sanctions against Russian companies, major banks, as well as the Central Bank itself. Against this background, the Russian financial market survived the strongest collapse since 2008, the Central Bank began foreign exchange interventions and the purchase of gold within the country to replenish reserves, and the Russian ruble became the most volatile currency in the world.