Russian banks will be able to replenish capital with RMB

The Central Bank will allow Russian banks to replenish their capital funds denominated in the Chinese yuan, said a source close to the Central Bank. This information was confirmed by a source in the Central Bank. “The draft regulation of the Central Bank, which will include the yuan in the number of allowed currencies for payment banks authorized capital, was indeed approved by the Board of Directors of the Central Bank”, — he said, adding that the ability to pay the capital of the yuan after the entry into force of the instrument will receive all banks, but the greatest interest for objective reasons, will be working here from subsidiaries of Chinese banks. “We also see interest from Chinese banks to open here, “daughters”, they’ll be able to form the authorized capital by using their currency,” said a source in the Central Bank. The document is now being coordinated by the Ministry of justice.

“The preparation of this document was discussed within the framework of development of bilateral Russian-Chinese relations and is connected with the de-dollarization of payments between our countries,” said a market participant who heard about the imminent document from the regulator.

Now according to the law and the Central Bank, the Bank may make capital in rubles and foreign currency from other countries, in particular us dollars, euros, Swiss francs, pounds, yen.

President of the Sino-Russian analytical center Sergey Sanakoev said that the opportunity to capitalize at the expense of the yuan may be of interest is already operating on the Russian market the Chinese credit organizations will thus be able to expand your business. “I think we will also see the arrival of new Chinese banks in our market this year,” he said.

In Russia there are several large Chinese banks, including Bank of China (Bank of China (ELOS) ), China Construction Bank (China construction Bank) and Industrial and Commercial Bank of China (ICBC — industrial and commercial Bank of China, TPBK). The latest in the beginning of 2015 in Russia opened China agricultural Bank (384-th place by assets), which is owned by state-controlled Agricultural Bank of China. The Bank is among the four largest banks in China.

While Chinese banks do not play a prominent role in the Russian banking market. The largest of them in Russia is ICBC (“Risibisi”), whose assets on 1 February was more than 74 billion rubles, the Bank is among the top 100 credit institutions. The Bank’s loan portfolio amounted to 8.5 billion rubles. the Bank was registered in August 2007, his business focused on servicing Chinese companies.

“The opportunity to increase the capital through different currencies in itself is interesting from the point of view of expanding the opportunities for our shareholders,” said a top Manager of one of the Chinese banks. According to him, banks prefer to provide capital in dollars, as the ruble is more risky currency. “I think the yuan can also be interesting, especially given the fact that its rate decreased against the dollar is not as much as the ruble,” — said the financier.

According to Sanakoev, the ability to draw in capital funds in RMB may be of interest to large Russian banks servicing foreign trade contracts with China. “Customers of these banks are interested in expanding the range of financial services, with the use of the yuan,” he says. Agree with him, the analyst of Raiffeisenbank Denis Poryvai, who believes that big banks may try to attract Chinese capital in Russian banks.