Half a million Russians declared bankruptcy last year as the country’s banking institutions bear the brunt of the cost of the war in Ukraine, a European intelligence report says this week.
As the war in Ukraine continues into its fifth year, Russia’s Ministry of Economic Development has cut its GDP forecast for 2026 from 1.3 percent to 0.4 percent.
Rising household debt is one of the things creating the conditions for an “explosive” banking crisis, according to the European intelligence report, seen by Reuters. But experts say that while individuals are facing a cost-of-living crisis – and many face bankruptcy – a full-blown banking crisis is unlikely.
Here’s what we know about Russia’s financial woes and what this means…