1. Lending Policy of
Banks in Russia
Submitted To:- Submitted By:-
Dr. Rituparna Das Vaibhav Singh
(Faculty of Management) Roll No. :- 781
2. Under Article 4 and Article 46 of the Federal Law on
the Central Bank of the Russian Federation (Bank of
Russia), the Bank of Russia conducts operations to
take deposits from credit institutions for the purpose
of regulating banking sector liquidity. Deposit
operations are conducted in compliance with Bank of
Russia Regulation No. 203-P, dated November
5, 2002, "On the Procedure for Conducting Deposit
Operations by the Central Bank of the Russian
Federation with Credit Institutions in the Currency of
the Russian Federation" (with amendments).
3. At present the Bank of Russia conducts the following
deposit operations with resident credit institutions in
the national currency: deposit operations at fixed
interest rates and deposit operations at auction rates
(deposit auctions).
Deposit operations at fixed interest rates
are conducted daily on standard conditions
(established by paragraph 4.3 of Bank of Russia
Regulation No. 203-P, dated November 5, 2002, "On
the Procedure for Conducting Deposit Operations by
the Central Bank of the Russian Federation with Credit
Institutions in the Currency of the Russian Federation"
(with amendments).
4. Deposit auctions are held weekly on Thursday on the
conditions set by the Bank of Russia (in accordance
with the quarterly schedule of deposit auctions).
Deposit auctions are held according to the American
auction principle, when a credit institution may make
both competitive and non-competitive bids, but
Dutch auctions are also possible. The largest possible
share of non-competitive bids set by the Bank of
Russia for a credit institution is 50%.
5. Bank of Russia counterparty credit institutions may
make bids to the Bank of Russia for participation in a
deposit operation by:
1. passing to the Bank of Russia regional branch a
tender agreement (compiled in established form);
2. conducting negotiations through the Reuters
Dealing System;
3. making a bid to the MICEX Electronic Trading
System (hereinafter MICEX ETS).
6. Deposit transactions via the Reuters Dealing System
and MICEX Electronic Trading System are conducted
on behalf of the Bank of Russia by its Moscow-based
authorised division, the Bank of Russia General
Economic Department.
A Bank of Russia counterparty credit institution is
free to choose any of the aforementioned ways of
making a bid for participation in a deposit operation.
Bank of Russia counterparties in deposit operations
are banks, settlement non-bank credit
institutions, and non-bank credit institutions
conducting deposit and lending operations.
7. Requirements for Bank of Russia counterparty credit institutions
As of the Bank of Russia deposit operation date, a credit institution
should meet the following criteria:
1. it should belong to the first or the second classification groups
under Bank of Russia standard acts (for non-bank credit institutions -
Bank of Russia Ordinance No. 766-U, dated March 31, 2000, with
amendments; for banks - Bank of Russia Ordinance No. 2005-U, dated
June 30, 2008);
2. it should comply with the Bank of Russia reserve requirements
(have no shortfall in the required reserves or unpaid fines imposed for
non-compliance with the reserve requirements and should present the
required reserve calculation);
3. it should not have overdue pecuniary obligations to the Bank of
Russia.
8. A credit institution should have a correspondent
account (subaccount) agreement or an additional
agreement to the correspondent account
(subaccount) agreement concluded with the Bank of
Russia regional branch where it has a correspondent
account or subaccount(s), giving the Bank of Russia
the power to recover from the correspondent account
or subaccount(s) without the credit institution’s order
a fine for non-compliance (improper compliance) by
the credit institution with its obligations in respect to
a deposit operation.
