Central Bank supports recapitalizing banks via subordinated loans with NWF money
MOSCOW. Nov 26 (Interfax) - The Central Bank of Russia supports the idea of recapitalizing commercial banks with subordinated loans using money from the National Welfare Fund (NWF), while it opposes easing capital adequacy requirements, Central Bank Chairman Elvira Nabiullina said in the Federation Council on Wednesday.
"I have an unfavorable attitude toward lower capital adequacy requirements, because those requirements were established in order to safeguard the interests of depositors and creditors. It must not be forgotten that banks operate with other people's money," she said in response to a question from one of the senators.
"As for utilizing NWF money, in order to contribute them to bank capital in the form of subordinated loans, I have a favorable attitude toward that and believe that this will make it possible to maintain bank capitalization. This must be done on transparent and comprehensible terms," she said.
The idea of exchanging preferred shares in the banks for federal loan bonds (OFZ) that will be included in basic capital requires further discussion, Nabiullina said.
The banks that have requested funds from the NWF include VTB (which is asking for 250 billion rubles) and Gazprombank (100 billion rubles).
