Sberbank to lower personal loan rates

Russia’s largest bank, Sberbank, will reduce loan rates by 0.5-1% starting from April 19, as well as getting rid of all commissions.

Sberbank CEO German Gref confirmed the plan and said interest rates on all kinds of credit to private individuals will be lowered.

“For the first time on the Russian market, the first time in our history, we have made the decision to abandon all commissions. And also the rate given on a credit will be an effective rate, a final rate for borrowers.”

Gref said that bank will not “apply any kind of commission, any kind of payment. Only on credit rates.”

Credit rates will be reduced 0.5-1% of a percentage point and will apply retroactively to commissions on borrowers.

“I hope that we will stimulate lending with this beginning on Monday.”

In a meeting with Prime Minister, Vladimir Putin, the Sberbank head described how the changes would take effect.

“Rates on consumer loans are higher. For mortgage loans, the lowest rate will be for clients who work at enterprises that have opened up payroll accounts with us. The lowest rate is 10.5%. They range up to roughly 13% depending on which scheme the client selects, to the extent his sources of income are reliable, what kind of down payment he makes, whether it's a mortgage loan or a housing loan for future registration as a mortgage loan," he added, "But our consumer loans are just a fraction of the rates under those consumer schemes that commercial banks are offering, particularly at retail locations. There it's 30%, 40% even 60%.”