The outgoing year can be partly considered a positive for the Russian economy – the WTO accession has finally been completed, the financial market infrastructure is being improved by creating a central depository, and a new budget rule has been adopted, which sets a limit on excessive growth in expenses. The overall macroeconomic situation, although not noticeably better than last year, remained within the trend of the relatively successful 2010–2011. At the same time, some segments of the Russian financial market have shown much better dynamics this year compared to other developing markets – first of all, the growth of the ruble exchange rate should be noted, as well as the high demand for Russian government bonds.

Deutsche Bank LLC

Universal bank. Owner – Deutsche Bank AG (100%). Financial indicators (as of October 1, 2012, Interfax-CEA data): assets – 125.6 billion rubles (40th place among Russian banks), equity capital – 16.4 billion rubles, retained earnings – 1.8 billion rubles.

At the same time, against the backdrop of these achievements, the Russian stock market stands out, with its dynamics significantly worse than the average for emerging markets. What are the reasons for such a discrepancy between the good performance of the bond and currency markets on the one hand, and the stock market on the other? Probably, one of the key factors is corporate governance. It would seem that the situation has even improved somewhat here - in the last few years, Russian state-owned companies have begun to pay higher dividends, which is partly due to measures taken by the government, including the recent decree on dividend payments in the amount of 25% of the profits of state-owned companies.

But the question for markets now is how long this dividend hike will last, given rising costs for state-owned companies: the stock market's attention and concerns are increasingly turning to the efficiency of Russian companies' spending. To make progress in this area, last year the Russian leadership put forward the thesis of reducing state-owned companies' costs by 10% over three years. Unfortunately, the issue seems to have slipped somewhat out of the government's focus since then.

Another negative factor for the Russian stock market was the absence of a full-scale stage of economic reforms after the formation of the new government. In part, expectations of such a course of action by the new government were based on the experience of 2000-2001, when after the presidential elections, Gref's program was developed, which laid the foundations for accelerated economic growth in the following years. It is precisely this kind of program, which would include clear guidelines and tasks for the short term, that could properly mobilize the government's actions, on the one hand, and improve the understanding of financial markets regarding the reform plans of the new government, on the other.

Finally, greater consistency is needed in formulating key economic development guidelines, including those related to the stock market and investments. On the one hand, the government is quite right to rely on investments to increase economic growth rates. On the other hand, one sometimes hears that the net capital outflow (which has been virtually non-stop since mid-2010) is not such a problematic phenomenon and that Russia does not really need portfolio investments; the main thing is to attract long-term direct foreign investments. But the fact is that improving the situation with portfolio investments could become the basis for changing Russia's image and increasing the inflow of direct foreign investments. Against the backdrop of the global crisis, competition for financial flows is growing, and in these conditions, Russia must significantly improve the investment climate and more clearly define the key priorities of its economic policy.

Capital Markets: Abnormal Stocks