Strategy of development of the banking sector in 2003 will be finalized till February 15

The strategy of the development of the banking sector in 2003 and for a mid-term perspective will be finalized till February 15, 2003. Russian First Deputy Finance Minister Aleksei Ulyukayev told reporters about it on Thursday after the end of the session of the Cabinet of Ministers who considered, in particular, the progress in the reform of the banking sector.

He said that amendments to the legislative basis would be made, because they are necessary for reforming the sector. Speaking about key trends in reforming banks, Aleksei Ulyukayev mentioned the reduction of the state's participation in their capitals and the creation of equal conditions on the market of banking services.

In the context of this reform, the reorganization of the Vneshtorgbank and withdrawal of its capitals from foreign banks will be continued. The Central Bank of Russia reduces its participation in the Danaubank, in the East-West United Bank in Luxembourg and in the Ost-West Handelsbank in Germany.

Characterizing the present state of the banking sector in the country, Ulyukayev pointed out that in the outgoing year the credit and financial institutions had considerably cut their arrears in the general reforming of the economy. For instance, the assets of the banks have increased to forty percent of the Gross Domestic Product (GDP). According to the government's forecasts, however, in 2003 they will increase to fifty percent of the GDP. The First Deputy Minister also said that the capitalization of the banking sector had gone up by some five percent of the GDP, and the size of the passive operations had increased up to twenty percent of the GDP. Aleksei Ulyukayev believes that in 2003 the banking sector will reach the necessary level, which has been established by the strategy of the development of the sector for 2003-2005.