Russia's economy is already in decline, and banks are bracing for a wave of defaults — Reuters

Russia is seeing a deterioration in its economic situation and a rise in the risk of loan defaults.

This is reported by Reuters.

According to Sberbank top manager Mikhail Matovnikov, the country’s economy “is not just slowing down, but is already falling,” which is affecting business revenues.

He cited falling external demand, high interest rates, and rising debt servicing costs as key problems.

According to data, in early 2026, the Russian economy contracted by 1.8%, and the share of non-performing loans reached over 11%.

Banks expect credit risks to continue rising, and state-owned companies may need to restructure their debts.

After three years of unexpected economic growth, Russia is facing a sudden slowdown—war costs, inflation, and falling oil prices have begun to weigh on an economy that until recently seemed resilient to sanctions.

Retail lending in Russia has fallen to a six-year low.