Russia economy on the edge as banks profits collapse

Russian banks saw their profits plummet by 25% in February as the country grapples with an unprecedented financial crisis fueled by the ongoing conflict in Ukraine.

Russia is struggling with historically high interest rates of 21% and record inflation, putting immense pressure on businesses and consumers alike.

Earlier this year, several top Russian business leaders warned about the dire economic situation, arguing that many companies risk permanent closure if conditions do not improve.

No sector has been spared, with the prices of basic food items surging over the past three years.

The real estate market has also been severely impacted, as potential homebuyers now face mortgage rates approaching 30%.

Ivan Ukleyin, Senior Director of Bank Ratings at Expert RA, told RBK:"Let's take a simple example: with an average mortgage term of 25 years and an interest rate of 15%, the buyer will end up paying four times the cost of the apartment—yet they will still only own one apartment."