12-06-2014, 10:20 AM
Not only are foreign lenders proven over the time to be “pretty low on the food chain,” says Standard Bank’s Mr. Ash, but past records also show a generalized opposition to creditor interests, backed up by debtor-friendly courts inherited from the Soviet era. He notes that during the recent global crisis, banks’ non-performing loans surged disproportionately in Russia even though the overall economy’s balance sheet was in a relatively healthy state before. It is evidence, Mr. Ash says, of an ingrained “unwillingness to pay.”
How Russia’s Debt and Currency Markets Could Spiral into Crisis - MoneyBeat - WSJ
Speaking a day after President Vladimir Putin said Russia is scrapping a proposed $45 billion pipeline to Europe, the government predicted the economy will contract next year and canceled a bond auction. It was also forced to pledge 39.95 billion rubles ($740 million) to support OAO Gazprombank, at least the third lender to secure a capital injection since U.S. and European Union sanctions curbed their ability to borrow.
Russian Woes Worsen as Recession Looms With Banks in ‘Panic’ - Bloomberg
Russia may use more than 500 billion rubles from the $88.9 billion Reserve Fund to finance the budget next year, said Maxim Oreshkin, head of the Finance Ministry’s strategic planning department. GDP forecasts of the ministries of finance and economy coincide for next year under the Finance Ministry’s “optimistic” scenario, which assumes an $80 oil price, Oreshkin said.
Russian Woes Worsen as Recession Looms With Banks in ‘Panic’ - Bloomberg
Retail sales, which were predicted to grow 0.6 percent next year, may instead plunge 3.8 percent, according to Vedev. Unemployment may rise to 6.4 percent in 2015, more than predicted earlier, and real wages will probably shrink 3.9 percent, he said.
Russian Woes Worsen as Recession Looms With Banks in ‘Panic’ - Bloomberg
Russia’s largest oil company, state-controlled Rosneft, has asked the government for over 2 trillion rubles ($49 billion) in aid to weather Western sanctions, Finance Minister Anton Siluanov said Wednesday, according to local news agencies.