The government will exceed the limit of domestic loans to 100 billion rubles.


In 2016, the Finance Ministry plans to borrow on the domestic market of 100 billion rubles over the limit to 300 billion rubles, specified in the budget law. About this at a Moscow financial forum said the Minister of Finance Anton Siluanov, the correspondent . According to Siluanov, the Finance Ministry has already fulfilled the annual programme of internal borrowing over 300 billion rubles net borrowing (placement of new securities minus repayment of old).

The Federal budget deficit in 2016 is expected to go beyond 3% of GDP prescribed in the law, so the Treasury must be added to cover the gap.

By the end of July 2016, the Finance Ministry has already exceeded the annual quota of 300 billion rubles, the net placement of OFZs, according to data of the Federal Treasury. At the end of August the net placing amounted to 226 billion rubles (placed 686 billion rubles repaid 460 billion). Since the beginning of September the Ministry of Finance sold RUB 30.7 billion, including the BFL, and repayments were not, the analyst of Raiffeisenbank Denis Poryvai. “Given the seasonal increase of budget expenditures and incoming in this regard, the liquidity in the system, we expect a further reduction in yields (even if the Ministry of Finance will increase the plan by 100 billion rubles),” he writes.

The law on the 2016 budget assumes a gross placement of OFZ bonds on 800 billion rubles and a maturity in the amount of 500 billion rubles.

The Finance Ministry also already reached my quota on foreign loans this year for $3 billion, dorazmestit yesterday Eurobonds for $1.25 billion after the may sale of securities of $1.75 billion, which was the first since September 2013. Net attraction on the foreign market should reach $1.7 billion (minus redeemable securities).

Next year the Ministry of Finance may need to increase both internal and external borrowing, said Siluanov. According to him, net domestic borrowing will amount to 1 trillion and foreign loans, the Finance Ministry may return to the limit of $7 billion, to usual 2014. But Siluanov warned that mindlessly increase their borrowing — it is dangerous. The Ministry of Finance releases OFZs with maturities of up to 30 years. But large borrowings “not all banks will be willing to invest in 10-year and 15-year bonds of the state”, says Minister in the June interview. “Say, “subject to our capital risk-based is preferable for us short of paper.” And the risk that we may be headed to t-bills, as it was some time ago, is one of the key risks,” he warned.

Now the Ministry of Finance occupied the domestic market with a yield of 8.7—8.8 per cent. In 2016, the budget will have to pay around RUB 470 bln in interest expenses for servicing domestic debt, and that’s not counting the 500 billion rubles for repayment of the securities, follows from materials of Department.

For mid-2016, Russia’s state debt (external and domestic) stood at us $165.5 billion, or 13.5% of GDP — low by international standards indicator. Rating Agency S&P improved this month the forecast on a sovereign rating of Russia from “negative” to “stable”, considering the “small net debt of the government along with the low level of spending on debt service as a positive rating factors.”
  

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