1 Nov 2018 15:52

Treasury chief: short-term bank loans for MinFin instrument for managing liquidity

MOSCOW. Nov 1 (Interfax) - Allowing the Finance Ministry to raise short-term bank loans to cover potential cash shortfalls, as stipulated in draft amendments to the Budget Code, is strictly an instrument for managing short-term liquidity, Federal Treasury chief Roman Artyukhin said.

The explanatory note accompanying the bill, which was submitted to the State Duma in the last few days, notes that the amendments would enable the Finance Ministry to borrow domestically to cover any cash shortfalls that arise (insufficient funds for timely fulfillment of budget spending commitments). The Finance Ministry's debt department head Konstantin Vyshkovsky told Interfax the bill aimed to enable the ministry to raise short-term loans namely from banks.

"Our cash box is doing very well. There was a balance of 6.548 trillion rubles as of October 31, of which 3.3 trillion rubles was excess oil and gas revenue. There was 924 billion rubles on the unified treasury account, 1.565 trillion rubles on deposit, 523 billion rubles in repo, 112 billion rubles in budget loans to subfederal entities, municipalities," Artyukhin said.

"We are not doing this [submitting the draft amendments] because the risk of cash shortfalls is arising. We haven't had and won't have any cash shortfalls," he said. "We have 1.58 trillion rubles on the unified treasury account. These are non-budgetary resources. Why are we doing this instrument? When we place [budget funds] for one-two-three weeks and suddenly some kind of urgent, hypothetically urgent payment comes up, then we can use this instrument. This is strictly an instrument for managing short-term liquidity," he said.