Share of liquid assets in Russia's NWF drops to record low of 32% by early 2025 - Accounts Chamber

MOSCOW. March 18 (Interfax) - The volume of liquid assets in the National Wealth Fund (NWF) reached a record low of 32.1% of its total volume by the beginning of 2025, according to data included in an analytical note from the Accounts Chamber on executing the 2024 federal budget.

The share of these funds in the total volume of the NWF at the beginning of 2024 was 41.9%, down from 58.8% a year earlier.

Overall, the volume of liquid assets in the NWF fell by 1.202 trillion rubles or 24% in 2024, amounting to 3.81 trillion rubles. This amount is "only slightly higher than the average monthly federal budget expenditures for 2025," and 19.7% higher than Russia's debt servicing costs for 2025 (3.182 trillion rubles), the chamber said.

The amount of NWF funds allocated to other financial assets increased by 1.117 trillion rubles or 16.1% in 2024 to 8.08 trillion rubles (4% of GDP). Of this, 38.7% was allocated to ordinary shares of Sberbank and 20% was directed to financing self-sustaining infrastructure projects. The share of these funds in the total volume increased from 58.1% to 67.9%.

The total amount of the fund in ruble equivalent decreased by 85.102 billion rubles or 0.7% compared to the beginning of 2024, amounting to 11.88 trillion rubles as of January 1, 2025. By the beginning of 2025, 57.8% was allocated in yuan and 42.2% in gold (as of January 1, 2024, the figures were 57.1% and 42.9%, respectively).

Two factors contributed to the reduction in the total volume of the fund - 1.300172 trillion rubles from the NWF were transferred to the federal budget's single account last year, of which 1.3 trillion rubles were used to cover the budget deficit and 172 million rubles were used for co-financing pension savings. In contrast, other factors increased the fund's volume. Funds in yuan and gold acquired from additional oil and gas revenues of the 2023 budget were credited to the fund, amounting to 38.798 billion rubles. Exchange rate differences and the revaluation of gold holdings for the year are estimated at 1.102 trillion rubles. The market revaluation of ordinary shares of Sberbank, Aeroflot and VTB amounted to 72.324 billion rubles. At the same time, the market value of Sberbank and Aeroflot shares increased by 56.354 billion rubles or 1.8% and 56.631 billion rubles or 1.7-fold, respectively, while the value of VTB shares decreased by 40.661 billion rubles or 30.4%. Other factors contributing to the fund's increase last year amounted to 1.581 billion rubles.

The amount of income from managing NWF funds credited to the federal budget amounted to 484.704 billion rubles, 1% above the forecasted figure.

Debt servicing costs in 2024 amounted to 2.329 trillion rubles. Their share in total expenditures increased by 1.8 percentage points compared to the pre-pandemic year of 2019, reaching 5.8%, making it one of the main items in the functional classification of expenditures, the Accounts Chamber said.