Corporate Debt Reaches Record Levels in Russia

The debt burden of Russian companies has climbed to a historic high, according to a new analysis by the Center for Macroeconomic Analysis and Short-Term Forecasting (CMASF), a think tank closely linked to the Russian government. The report finds that in the third quarter, corporations spent 36% of their profits on servicing debt — the highest figure the CMASF has recorded to date. Compared with the same period a year earlier, the share rose by 10 percentage points, and relative to 2019 by as much as 20 percentage points. It remains unclear how far back the dataset used for the analysis extends.

Several factors are contributing to this mounting debt pressure. Chief among them are the continued expansion of corporate borrowing, persistently high interest rates set by the Russian Central Bank, and a sharp decline in corporate profitability. Official data from the federal statistics service Rosstat show that between January and August, Russian firms earned a combined 17.6 trillion rubles (about €188 billion) in profits. That represents a 12% nominal decrease compared with the same period last year. Adjusted for inflation, profits have fallen by roughly 20%, underscoring the extent to which rising costs and weak demand are eroding business performance.

Economists note that this combination of higher borrowing costs, lower revenues, and an uncertain economic outlook is tightening financial conditions for many companies. As a result, more firms are relying on loans simply to maintain operations — a trend that raises concerns about financial stability and the potential buildup of systemic risk within Russia’s corporate sector.

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