Financial Results of Sberbank for 1H2025: Net Profit Growth and High Profitability
Russia's largest bank, Sber (Public Joint Stock Company Sberbank), has released its interim consolidated income statement in accordance with IFRS for the first half of 2025. According to the published data, the bank's net profit amounted to 859 billion rubles, a 5.3% increase compared to the previous year, with a return on equity (ROE) of 23.7%. For investors from the CIS countries, these financial results confirm the bank's resilience under current economic conditions. Below, we analyze key aspects of the report that are of interest to market participants.
Net Profit Growth and Earnings Per Share
Sber's net profit for the first half of 2025 reached 859 billion rubles, marking a 5.3% year-on-year growth. Despite this moderate increase, the result is close to record levels and reflects the bank's ability to enhance profitability even after a significant recovery in the previous year. On a per-share basis, earnings per share amounted to 38.6 rubles, which is 5% higher than the previous year. The growth in EPS indicates that the benefits of increased profits are proportionately distributed among shareholders, maintaining the attractiveness of the bank's shares for long-term investors. The slight slowdown in the growth rate of net profit can be primarily attributed to increased expenses – particularly the rise in provisions and tax contributions – which partially offset the strong growth in operating income.
High Capital Profitability
The bank maintains an impressive return on equity at around 23–24%. For 1H2025, ROE stood at 23.7%, only slightly differing from last year’s level, remaining one of the best indicators in the banking sector. This high profitability demonstrates effective utilization of capital and the ability to generate substantial returns on shareholders' investments. Together with a sufficient capital buffer, this allows the bank to simultaneously support growth and provide generous dividends.
Dynamics of Interest and Fee Income
Net interest income increased by 18.5% year-on-year to 1.674 trillion rubles, driven by the expansion of lending volumes and the rise in asset yields amidst increasing market rates. The bank effectively capitalized on the period of high rates, boosting income from asset placements while optimizing funding costs; as a result, the group’s net interest margin improved compared to the previous year. Meanwhile, net fee income remained virtually unchanged from 2024 (approximately 349 billion rubles, -1% year-on-year). There is a steady increase in fees from banking card transactions and payment services; however, the impact of last year's high base and a slowdown in business activity in the second quarter limited total fee growth. Overall, the robust growth of interest income combined with stable fee income confirms the resilience of Sber's diversified business model.
Operating Expenses Under Control
Sber's management continues to keep expense growth in check, maintaining a high level of operational efficiency. For the first six months of 2025, operating expenses amounted to approximately 555 billion rubles, representing a 14-15% year-on-year increase. This increase in costs was partially driven by inflationary pressures (salary indexing and other items) as well as significant bank investments in IT infrastructure and the development of digital services. Nevertheless, the rise in expenses slightly outpaced income growth, enabling the cost-to-income ratio to remain around 33%. Investors view this level of expense control positively, as Sber maintains one of the best business cost structures in the sector, ensuring high operational profitability even in challenging macroeconomic conditions.
Asset Quality and Reserve Expenses
The quality of the loan portfolio remains relatively high, but the bank has exercised caution in risk assessment amidst external economic challenges. In 1H2025, Sber significantly increased provisions for loan impairment: total reserve expenses reached 335 billion rubles, more than doubling compared to the same period last year. The increase in provisioning is linked to borrower pressures due to high rates and economic volatility; the management chose to build an additional safety buffer in advance. Despite the substantial provisions, the level of non-performing loans remains low and is fully covered by reserves – indicating a conservative approach to risk management. Increased provisioning temporarily restrains net profit; however, it simultaneously enhances the long-term stability of the balance sheet.
Financial Stability and Tax Burden
The financial stability of Sber during the reporting period remains high. Capital adequacy ratios significantly exceed regulatory requirements: the common equity tier-1 ratio (N1.1) exceeds 13%, while total capital covers around 14% of risk-weighted assets. A high level of equity and profitability provides a buffer in case of stress scenarios and allows for active business growth financing. At the same time, the tax burden on profits from the government has increased. For the first half of the year, the bank accrued around 257.5 billion rubles in profit tax – a quarter more than a year earlier. The effective tax rate has risen, partly due to legislative changes and one-off levies on profitable companies. Consequently, the increase in the tax burden has been one of the factors restraining net profit growth during the reporting period.
Assessment of Dividend Payment Potential
Sber's high profitability translates into benefits for shareholders through substantial dividends. The bank adheres to a generous dividend policy – in recent years, approximately 50% of its IFRS net profit has been directed towards shareholder payments. For 2024, the dividend amounted to 34.84 rubles per share, providing a double-digit dividend yield at current share prices. Considering the results of 1H2025, dividends are expected to remain at a high level, comparable to or exceeding last year – depending on profit dynamics in 2H2025. This predictability and generosity of payouts to minority shareholders is a significant advantage. With high profitability and a strong capital buffer, Sber is capable of simultaneously reinvesting a significant portion of profits in development and paying substantial sums to shareholders.
Comparison with Last Year and Outlook for 2H2025
The previous year was characterized by lower rates, which restrained growth in interest income but allowed for minimal reserve expenses. In 2025, conversely, the sharp rise in the key rate (up to 21%) boosted the interest margin but necessitated increased provisions. Nevertheless, the bank navigated the expensive money period successfully, maintaining profit growth and asset quality. Now, following a decrease in the rate to 18% (July 2025), a slight contraction in margins and relief in debt burdens for borrowers is expected in the second half of the year.
The outlook for 2H2025 appears balanced overall. On one hand, a gradual easing of monetary policy may lead to moderate growth in interest income. On the other hand, lower rates could stimulate demand for loans and reduce pressure on borrowers, positively impacting asset quality and allowing for a reduction in reserve expenses. Bank management expects that the return on equity for the year will surpass 22%, assuming current trends and stable external conditions persist – in this case, 2025 could conclude for Sber with a new record profit.
Conclusion for Investors
The financial results for the first half of 2025 reaffirm that Sber remains one of the most resilient and profitable financial organizations in the region. Moderate profit growth is accompanied by very high returns on equity and generous dividends, making investments in the bank reliable and profitable: investors receive both capital appreciation and a stable stream of dividends. Undoubtedly, risks remain – including changes in the regulatory environment or new economic shocks – but Sber's current resilience and efficiency provide grounds to expect successful fulfillment of its forecasts.
