The Central Bank softens standards
Yesterday, the director of the Central Bank's prudential supervision department, Alexei Simanovsky, told Kommersant that the Bank of Russia can give a number of economic standards an evaluative character instead of mandatory ones. This means that today the Central Bank is confident in the stability of the banking system.

The Central Bank has repeatedly stated that the banking system has overcome all the consequences of the financial crisis. However, more compelling evidence of its sustainability is the easing of the Central Bank's requirements for banks. And first of all, economic standards: there is no need to punish normally operating banks (and this is what threatens banks that violate standards).
The Central Bank announced its intention to soften the standards a year ago. Moreover, the bank has already transferred some of the standards, in particular N8 (the maximum amount of risk per creditor-depositor) and N11 (the maximum amount of attracted deposits from the population), into the category of estimates. Yesterday, in a conversation with a Kommersant correspondent, Alexey Simanovsky stated that a number of other standards were inappropriate.
In particular, N5 (general liquidity standard), N13 (maximum amount of bills issued by the bank), N11.1 (maximum amount of liabilities to non-residents). “Currently, a methodology for cash liquidity is being developed, based on an analysis of cash flows, so in the future it is possible to abandon the mandatory nature of these standards,” he explained.
By the way, the N11.1 standard was introduced in January 1998 and was the Central Bank’s response to the outflow of foreign capital from Russian banks in the fall of 1997. However, as we know, it was still not possible to save the banking system from the crisis. The fact that today the Central Bank is considering the possibility of giving a number of standards an evaluative nature suggests that, de facto, the Russian banking system has returned to a stable state. The cancellation of N11.1 will fix this fact de jure.

NATALIA Kommersant-KULAKOVA, KIRILL Kommersant-Yacheistov

Newspaper "Kommersant" No. 92 dated May 30, 2001, p. 7

Themes:

Activities of the Central Bank