Russian banks to survive 1998-scale crisis

According to the IMF (International Monetary Fund) and the WB (World Bank), the Russian banking sector can survive a 1998-scale crisis, First Vice-Chairman of the Central Bank of Russia Andrei Kozlov said Tuesday at a roundtable session of Russian and EU industrialists.

Among positive trends in the Russian banking sector, Mr Kozlov named its orientation towards real economy, small business crediting, and growing consumer and mortgage demand.

In his words, one third of all credits falls on industry. Consumer credits grew by 53% within six months, and small business credits by 29%.

Private deposits are increasing rapidly. "Only two years ago private deposits amounted to less than 15%, and now they make over 40%," said the Central Bank's first vice chairman.

Mr Kozlov also recalled that Russia's bank assets now made over 5 trillion ($1 equals slightly less than 30 roubles). The growth in loans in the first nine months exceeded 400 bln roubles.

At the same time, Mr Kozlov said that the banking sector still had to tackle the task of ensuring reliable accountability and transparency of credit organisations. In this connection, the first chairman of the Central Bank noted, about 90% of Russian banks directly or indirectly belong to private persons.

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