Sberbank since October launches refinancing for customers who have taken personal loans, auto loans, and holders of debit cards with permitted overdraft. As reported in a credit institution, borrowers will be able to refinance in the savings Bank, even if they are few (no more than five credits in different banks. To combine multiple loans into one, you need to refinance at least one of the loans received from third-party Bank. To use the program will be able to borrowers who have no arrears on previous loans, specified in the savings Bank. The offer applies to customers of other banks, and borrowers of the savings Bank.
So far, the refinancing program acted the savings Bank only in the framework of the pilot, which was launched two regional banks from 14.
“The market of consumer crediting and credit cards now there is a large variation in credit conditions. Express loans and credit cards occupy a significant segment in consumer lending, but the rates on them are higher, it is from them we expect the greatest demand,” said RBC senior managing Director-Director of Department of retail non-transactional products Natalia alymova.
Growth at the expense of competitors
Sberbank is not the only Bank that decided to launch the refinancing program for unsecured loans. A similar program is prepared in Raiffeisenbank (until now, the Bank offered to refinance only mortgage borrowers), and from October the new terms for refinancing loans are going to go Binbank, and MDM Bank (both credit institutions are members of the financial group of Mikhail Shishkhanov).
In mid-September, the program of refinancing of consumer loans launched SKB-Bank, offering customers a rate of 22.9% per annum. “We note that refinancing actively interested in how the existing customers of SKB-Bank and the customers of other credit organizations”,- said the official representative of the Bank Andrey Ermolenko.
Market participants expect that the program of refinancing will help them to increase lending volumes in retail loans. “Refinancing certainly a very promising direction of development and growth of the retail loan portfolio. We hope that next year the share of loans for refinancing, will amount to 15% of the total volume of loans”,- told RBC head of development of credit products of the Bank Svetlana Gordeeva.
“It is an opportunity to attract Bank customers with good payment discipline, and in addition, given that some refinanced loans, the Bank consolidates all the client’s indebtedness and, therefore, increasing lending volumes,” explained head of consumer lending at VTB24 Dmitry Polyakov.
VTB24 has launched a refinancing program in late 2015 and, according to the banker, it is possible to increase the issuance of unsecured loans by approximately 20% in one month and to put a two-year record for loan extension. In the first 9 months. 2016 VTB24 was refinanced about 30 thousand loans totaling about 15 billion rubles, said the credit institution. Earlier, the head of VTB24 Mikhail Zadornov said that the Bank before the end of the year plans to refinance 1 billion rubles.month.
Refinancing is one way to attract high-quality borrowers to banks, said a top Manager of a major Bank. According to him, the idea that to ensure the growth of the loan portfolio for the account of customers of other banks who have already passed all the assessment procedures and properly served the debt.” It is very profitable for banks. Trusted clients and we and others are ready to give loan on more favorable terms, because we consider them as less risky category of borrowers,” – said the banker.
Offers of banks to refinance old loans are also associated with an increased interest on the part of borrowers who took out loans in late 2014 – early 2015, when due to a sharp growth rate of the Central Bank (in December 2014, the regulator increased the rate from 11% to 17%) and trying to reduce the debt servicing costs.
“The demand for refinance loans increases, the increasing number of borrowers are trying to refinance,” confirms the head of the block “Retail business” Bank Vozrozhdenie Eugene Dmitriev. According to him, this is especially true in a period of declining rates, usually in the initial growth phase after the crisis.
As pointed out by the head of credit products Raiffeisenbank Andrey Morozov, although the volume of consumer loans dropped after Dec 2014, but those banks that continued to lend did so at high rates, because the cost of funding for them was quite expensive. For example, according to him, the cost of mortgage money in the market for some banks in the first quarter of 2015 were in the region of 15-16%.
“Accordingly, those who took out loans in that period, now, probably, with pleasure will take advantage of the offers of banks on refinancing. This is important especially for high-quality borrowers that have no problems with credit (no delinquencies). I think that in the first place for this segment of customers, banks are now and start hunting,” – said the banker.
The battle of the rates
The interest rate on the refinancing of Sberbank – from 14.9% per annum. “Clients are always interested in the opportunity to refinance on more attractive terms. And in connection with the gradual reduction of the key rate will become more relevant,” – said alymova. Judging by this rate, to compete with the largest banks in the country can now only VTB24, which in late summer has reduced the rate of refinancing unsecured loans from 17% to 15%, and Gazprombank. The last announced a reduction in the cost of refinancing on consumer credits in June 2016 ,reducing the rate by 2 percentage points Now the minimum bet for those who want to refinance in Gazprombank is 13% per annum, but the proposal concerns only the military and law enforcement personnel serving under the contract. A requirement of refinancing is collateral from the client and the existence of a contract of risk insurance of death and disability.
“Sberbank is now offered the lowest rates in the market and, of course, other market participants will try to protect their assets, just because to give good borrowers, who a year or two pay on the loan, it is quite painful to balance. To attract clients is expensive, so the banks to keep the customer base will go with counter-proposals”.- said Mr. Morozov.
He does not exclude that the savings Bank will succeed due to the low rate to compete for retail customers of other banks. “However, therein lies the problem for Sberbank, which controls about 30% of the retail lending market. Offering a rate lower than that which issued loans to private customers, the savings Bank risks losing the loyalty of these borrowers. It may seem unfair that they have to pay 18-20%, and the other offer is 14.9%,” – said Morozov.
About the possibility of the flow of retail customers from the portfolios of other banks to Sberbank, saying other members. “We already watched it this year, when the savings Bank began to dump in the segment issuing cash loans. All banks working in this segment, had to the limit to cut rates,” recalls the head of a major retail Bank included in the top 10. According to him, the question still is, what conditions in addition to rates, the savings Bank is ready to refinance other banks ‘ customers. “There are always additional conditions that may not be appropriate for all borrowers,” – the expert specifies.