Gref sees risk of slowdown to economic growth if current money-credit policy continues
MOSCOW. Oct 24 (Interfax) - If Russia's current money-credit policy continues, the country faces the serious risk of a slowdown in economic growth, the President and CEO of top Russian bank Sberbank , German Gref, told journalists following the bank's business breakfast on Wednesday.
"I forecast that by year's end we'll have a significant influence on economic growth in the country. If no changes are made to the model for money-credit policy, I would still have a pessimistic view of the economic growth rate in the country for next year," Gref said.
He said that the situation with liquidity is approaching critical. Gref also said that this is not the result of bank risks but high cost for liquidity, which banks have to fight for, as well as the high rate on liabilities. This, in turn, causes borrowing rates to go up, which, according to Gref, is very dangerous for economic growth.
"In my view, we need to solve the problem of liquidity provision and the positive real rates in the economy now visible," Gref said.
He added that the current positive real rate (the difference between inflation and real lending rates on the market) comes to around 6%. "This means that enterprises are in no condition to invest and raise loan funds for investment projects at such high prices," Gref said, adding that this situation should be followed closely.
Sberbank's chief added that there are now no risks of a bubble appearing on the consumer lending market now but, theoretically, that danger does exist.
"What we've seen in the past two months indicates that we've likely seen a slowdown in growth rates for consumer lending," Gref said, adding that according to Sberbank's stats on consumer loan applications, it could be said that the rate of lending growth is slowing by 33.3%
Gref added that special measures on consumer loans should not be rushed into effect.