The Central Bank of the Russian Federation suspends enhanced support for banks in 2023

Two banks used the easings introduced in 2022 to one extent or another, Interfax writes, but the regulator believes that the support measures once necessary for most of them turned out to have a very moderate effect on capital, therefore, canceling relaxes will not become critical to them.

Among the measures that the Central Bank decided not to renew in 2023:

• the possibility of fixing exchange rates, the value of securities and assets (for the purposes of prudential regulation),
• the possibility of fixing the value of individual securities and financial instruments (for accounting purposes),
• the ability to not comply with the limits of open currency positions in order to reduce risks and reduce the proportion of “toxic” currencies,
• the ability to apply a reduced risk weight for concentration indices for corporate borrowers, in respect of which the bank has increased the number of credit requirements in the amount of more than 10 billion rubles,
• the ability to apply a reduced risk weight for capital adequacy and concentration standards for working loans of systemically important organizations,
• the ability to set the maximum rate on subordinate ruble instruments.

The preferential provisions regime continues to be valid for loans issued before February 18, 2022 (applies to both legal entities and individuals).

The Central Bank also announced that in 2023 Russian banks will start disclosing financial statements again, but they will do so in a limited format.

For another six months, they are allowed not to disclose information about themselves “sensitive to sanction risk”: for example, data about people who control credit institutions, members of management bodies and other officials, about reorganization, merger or acquisition, on the ownership structure and other material facts that affect economic and financial activity.

Among other things, from January 1, 2023, the Central Bank of the Russian Federation, when conducting liquidity operations and granting guaranteed loans to banks, will switch to using credit ratings, which was discussed in April 2022.

Said operations will be carried out by the Central Bank provided that the credit institution has at least one credit rating assigned by the rating agencies ACRA (JSC) or Expert RA JSC.

At the same time, the rating should not be lower than the minimum allowable rate: for REPO operations and collateralized lending operations in the form of securities — B-(RU)/RUB-; for loan operations secured in the form of credit rights under loan agreements — and BB-(RU)/ruBB-.