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Russian banks not facing massive closures
RBC, 11.11.2008, Moscow 16:52:24.The Bank of Russia does not believe that passing a law on increasing capital requirements for banks will lead to a considerable decrease in the number of banks, said Mikhail Sukhov, head of the Central Bank's banking licensing and financial rehabilitation department, during discussions on proposed amendments to the current federal law on banking at a State Duma committee meeting. "This will not lead to the departure of hundreds of banks from the market," he assured deputies. According to Sukhov, the bill's aim is to strengthen the banking system and increase the financial sustainability of lending organizations. "Any one of the existing banks is in a position to boost capital, if it is of any interest to investors - otherwise, it will have to become a non-banking organization," he said. In turn, member of the State Duma's banking committee and head of the Association of Regional Banks (ARB), Anatoly Aksakov, disagreed. He maintained that over 10 regions in Russia had no banks with a capital of more than RUB 90m (approx. USD 3.34m) at all, while such smaller banks could still boast sustainable operations and provide services to the general public. The bill's consideration has been postponed until after another bill, on banking mergers and restructuring, is finalized for a first reading at the Duma next week.
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