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Report: Clean-up of Russian banks could take 5 years, says central bank official

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Report: Clean-up of Russian banks could take 5 years, says central bank official

The CentralBank of the Russian Federation's deputy head, Vasily Pozdyshev,said the regulator is only halfway through the process of cleaning up thecountry's banking sector, and its rehabilitation and "structuralreconfiguration" will take another three to five years, Reuters reportedSept. 27.

Pozdyshev, who is responsible for banking regulation, saidthe number of lenders operating in Russia has fallen to just over 600 from morethan 850 at the start of 2014, as "criminal" banks are being shutdown.

To strengthen the Russian banking sector, the central bankintends to gradually raise lenders' minimum authorized capital to 1 billionRussian rubles by 2018 from 300 million rubles, Pozdyshev said. He noted thatas of Sept. 1, only 320 banks met the 2018 requirements, while about 50 banksheld approximately 700 million rubles in capital and were likely to reach thenew regulatory minimum by 2018.

As of Sept. 27, US$1was equivalent to 64.03 Russian rubles.