MOSCOW, April 29 Reuters Russias Sberbank made a record profit in the first quarter of 2021, more than doubling year on year thanks to lower provisions against bad loans, prompting the bank to raise its profitability forecast.

Last year Russias biggest bank missed its prepandemic target with a 10 decline in net profit owing to provisions against bad loans, but it pledged to maintain its dividend payout and promised a significant rise in 2021 profit.

The health of the sector is in focus after Russian banks set more money aside against potential bad loans in the face of economic contraction and a weaker rouble triggered by the coronavirus crisis and a sharp drop in prices for exports.

Staterun Sberbank on Thursday said its net profit rose to 304.5 billion roubles 4.1 billion in the first quarter, from 120.5 billion roubles in the same period of 2020.

Meanwhile, bad loan provisions fell to 44.2 billion roubles from 138 billion roubles in the same period last year.

The stabilisation of the loan portfolio asset quality allowed a significant reduction of the credit risk cost, finance chief Alexandra Buriko said in the earnings report.

Sberbank lowered its 2021 cost of risk forecast to 100 basis points from a previously expected 120140 basis points.

A strong start in 2021 gives us the ground to raise our forecast for the return on equity to exceed 20 in the current year, Buriko added in the statement.

Sberbank had previously forecast its 2021 return on equity ROE,…