Museum Nicholas Roerich, Moscow
Depositors who lost their savings when Russia’s Master Bank was closed down last week can at least hope for some compensation from government-backed insurers. But there’s no light at the end of the tunnel for the museum in Moscow that depends on Master Bank’s now discredited chairman for a living.
Boris Bulochnik has not been seen in public since the Russian central bank revoked Master Bank’s license last week citing “large scale suspicious operations” and a Rbs2bn balance sheet hole. Read more
Over the past few months, a lot of questions have been raised about the share of Russian money flowing through Cyprus, not always legally, and what effect this would have on an EU bailout for the island.
Now as EU leaders prepare to meet and discuss the bailout this Friday, Moody’s raises two equally important questions: How at risk are Russian banks and companies to problems in the Cypriot banking sector? And how likely are Russian depositors and creditors to get their money back after an EU-managed bailout? Read more
First one warning about the vulnerabilities in Russian banking. And now another.
Last week Alfa Bank highlighted the potential problems associated with the recent rapid growth in consumer lending and the dependence of banks on central bank finance. This week Standard & Poor’s is pointing to precisely the same risks. Read more
Russia’s consumer spending spree could be ending in tears. A credit-fuelled surge has led households to rack up unprecedented levels of consumer debt – so much so that in 2012 some 80 per cent of new consumer loans (excluding mortgages) are going towards interest on existing debt. This cannot go on.
“In Russia, the macro-economic risks are small,” says Natalia Orlova, chief economist at Alfabank, “But the risks in the banking sector are accumulating. Retail lending is becoming a high-risk segment.” Read more
By Ben Aris of business new europe
Russia’s express consumer lending business was launched by the “Vodka Bank” in 2001, and now the country’s credit card business is being championed by what could be called the “Beer Bank.”
Consumer lending in Russia exploded after the small start-up bank Russky Standart – better known for its premium vodka of the same name – introduced the concept of lending cash with no security at the point of sale. At the time the bank was thought to be a flash in the pan, but a decade later most of the incumbent banks in Russia are still struggling to catch up with Russky Standart.
Oleg Tinkoff hopes to pull off the same trick with credit cards. Read more
Could Russia be seeing more consolidation in its lumbering banking sector? Nomos Bank, the country’s 13th biggest bank, is in discussions to acquire mid-sized lender Otkritie. But will the deal actually happen?
Russia’s rumour mill kicked into gear on Tuesday after Russian Daily Vedomosti ran a front page story announcing that the two lenders were close to an agreement. Behind the scenes, however, it looks like not everything is wrapped up yet. Read more