The FICO Credit Health Index measures the overall credit health of the country, based on the percentage of consumer loans and credit cards reported to NBKI that are delinquent by more than 60 days. Since January 2012, this "bad rate" has increased from around 7 percent to over 8 percent.
All regions have shown a continued quarter-on-quarter drop in the index since January 2012, with the exception of Centralnyi which remained constant compared to last quarter. The Dalnevostochnyi region suffered the largest fall since January 2012, 13 points. The Severo-Kavkazskii and Sibirskii regions fell by 10 points, and Uralskii by 8 points.
"The decline in repayments is largely due to the large number of new borrowers who are not as experienced at managing payments," said Alexander Vikulin, CEO of NBKI. "Over the last year, the number of consumers in the NBKI database grew by 28 percent, to more than 60 million. The fall in the Index is not due to weak risk management on the part of Russian banks, which is generally at a very high level. If you look at the relationship between past-due consumer debt and potentially unrecoverable consumer debt, it has not changed since last quarter."
"As the FICO Credit Health Index continues to decline, we advise lenders to actively communicate with borrowers who are missing payments," said Evgeni Shtemanetyan, who directs FICO's operations in Russia. "The Index has not fallen nearly as sharply as in 2008-2009, but it's clear that new borrowers need careful monitoring as well as credit education."
FICO and NBKI share this data with Russian lenders to improve their understanding of the market, and help them safely extend credit to consumers. More than half the top Russian banks use FICO® Scores delivered by NBKI.
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National Bureau of Credit Histories (NBKI) is the largest credit bureau in the Russian Federation. It was created in 2005, and counts among its shareholders major commercial banks and international companies CRIF and TransUnion. Its main specialty is an integrated center that stores and processes comprehensive data for creditors' decision making. As of August 2012, NBKI consolidates data from more than 1,350 Russian creditors. The bureau provides the Russian market with modern high-tech solutions for risk assessment and control.
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