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Russian banks increase liquid foreign exchange assets by $8.5 billion in January

By on February 21, 2022 0

By Elena Fabrichnaya and Katya Golubkova

MOSCOW (Reuters) – Russian banks increased their liquid assets held in foreign currency from $8.5 billion in January to $53.5 billion, the central bank said on Monday, in a sign that lenders may try to strengthen their foreign exchange shield in light of new sanctions threats.

The United States is considering new sanctions against Russia, offering to withdraw some of its major banks from dollar transactions and reduce their ability to meet dollar-denominated obligations, sources told Reuters.

The sanctions would come into effect if Russia invades Ukraine, a move the Kremlin denies is on the cards despite a large buildup of Russian troops near its neighbor’s borders.

Banks’ liquid foreign exchange assets, such as cash held by lenders directly and at the central bank as well as short-term loans and other non-ruble tools that could be easily claimed, amounted to $45 billion in December. , the central bank said in a statement. report.

Earlier on Monday, Russian ratings agency ACRA estimated that the country’s banks imported $5 billion worth of foreign currency banknotes in December, double from a year ago, as a precautionary measure. in case sanctions create increased demand.

The central bank declined to comment on ACRA’s calculations, nor did it provide a breakdown of banks’ liquid foreign exchange assets disclosed in its report on Monday.

However, he said that last month lenders had 21% of their customers’ foreign exchange funds and 15% of banks’ liabilities covered in cash – a cushion of protection if customers demand a quick withdrawal. That was up from 18% and 13% in December, respectively.

Although retail customers withdrew 810 billion rubles from their current accounts last month, Russian banks managed to post 164 billion rubles ($2 billion) in profits in January, up 47% from the previous month. previous month, the central bank said.

($1 = 79.2050 rubles)

(Reporting by Elena Fabrichnaya; Writing by Katya Golubkova; Editing by Alexander Smith and Frank Jack Daniel)