The Russian auto lending market is gradually recovering after last year's downturn. This trend is confirmed by the Bank of Russia’s analytical review ‘Banking Sector’ for Q2 2025, as well as the preliminary market data for the first half of the year presented by VTB.
Commentary is provided by Valery Tyurin, Head of Investments and Financial Markets, Audit and Advisory for Financial Institutions at FBK.
Demand for cars and buses showed positive momentum driven by flexible terms under auto lending programmes and preferential leasing schemes, as well as pent-up demand.
Key market indicators:
- the number of auto loans issued increased by 16% year‑on‑year;
- the volume of auto lending rose by 42%;
- the average auto loan size grew by 21%;
- the average auto loan term increased by 13%.
The number of new buses purchased rose by 5.1%. Growth in this market segment is attributable to the implementation of targeted state initiatives:
- nearly RUB 32 billion has been allocated for preferential bus leasing under the federal project ‘Infrastructure for Life’ (Government Resolution No. 2077 dd 19 December 2025);
- RUB 7 billion has been set aside for subsidised leasing to supply buses to Russian regions under the Ministry of Industry and Trade's programme ‘Development of Industry and Enhancement of Its Competitiveness’.
Given the clear need to modernise the bus fleet (in 2025, the share of public transport fleet with a service life not exceeding the standard stood at 61.7%; by 2030, according to the Transport Strategy, it should reach at least 85%), further growth in new bus deliveries is expected in the years ahead.
Benefits for lenders from financial support measures
The growth in auto lending metrics translates directly into higher profits for financial institutions.
Risks for lenders from financial support measures
The observed trends—rising car prices and longer auto loan maturities—indicate a decline in borrower solvency and deterioration in collateral quality. This erosion of credit quality heightens the risks of delinquencies and defaults. In response, financial institutions both need to adjust interest rates to preserve credit margins and strengthen their credit risk management systems.
