Russian bank sector overview

The news of the day

• According to the statement of Standard&Poor's, the economy of Russia still heavily relies on its oil sector too much which prevents its independent rating from growth and questions the stability of the achieved economic growth. Moreover, in 2003 the revenues from exporting oil, gas and metals had reached the maximum figure for the whole history of post-Soviet Russia and constitute 75 percent of the total export revenues versus 60 percent in 2002. Director of  S&P Independent Rating Agency Helena Hessel said that stability of economic development is important factor in her agency’s evaluation and currently S&P sees no diversification of the sources of the growth of Russian economy.

Market analysis

• On December 16 the corporate shares quotations grew beyond the experts’ expectancies, especially this relates to the bond issued by Moscow city government. The profitability of Gazprom lowered to 8.5 percent, Moscow debts have no profit rate  over 9 percent either. Although growing can become slower after such significant periods, we see no reasons which could lead to significant lowering of quotations.
• Operations with hard currency are influenced by coming New Year holidays – there are no big orders on the eve of the celebration which lowers the market activity and stabilize the quotations on the level reached earlier.

News

Department of Finance of Tverskaya region changed the date of placing the shares of the second lot for the sum of 400 million roubles from December 17 to December 24;
• According to Head of Federal Commission on Securities Mr. Kostikov the commission expects the Pension Reform will not cause the influx of money to the exchange market over 30 million dollars in 2004, but by 2008 such money influx will be almost ten times as big as it is today.
• Moody's Rating Agency increased the long-term deposit rating of Vneshneeconombank from  “Va3” to “Va1”, the prognosis for this rating is stable;
• None of the shareholders used the opportunity to clear off  CLN of RITEK company ahead of time, in sum of 30 million dollars 45 days after the date of the closure of the deal, MDM-Bank which issued the bonds informed December 15;
• According to Deputy of Ministry of Finance, Head of federal Treasury Tatiana Nesterenko, the Stabilization Fund created by the Ministry of Finance on the base of the reserved finance will have been 80-90 billion roubles by February 1, 2004.
• On December 11 Tomsk region placed its inner loan securities of series 25012 and in the sum of 60 million roubles having profit ratio for their clearing off as 15.1 percent per yearn December 11, the auction price constituted 99.5 percent of the nominal. The bonds have quarterly coupon having annual rate 14 percent with 17 mont term of circulation.

Market of state treasure bonds

• The activity of the participants of the federal bonds market increased significantly on December 16, total turnover exceeded 1 billion roubles, meanwhile Central Bank gave no information about issuing additional bonds. The price of the bonds were gradually increasing. Therefore the profit rate of bonds 46001 and 46002 lowered by 2 and 3 points, only long term bonds 46014 had a significant decrease in profitability – by 9 up to 8.3 per cent of annual profit rate (because there were no sales for the bonds of this nomination December 15).

Source: Rosbank