Mega-regulator plans won't affect Russian financial institutions in short term - S&P
MOSCOW. Oct 16 (Interfax) - It could take a while to create a mega-regulator in Russia but the process will not affect the country's financial institutions in the foreseeable future, Sergei Voronenko, leading analyst at Standard & Poor's, said at a conference.
"We think quite a lengthy period will be needed to at least prepare the project technically. In our baseline scenario this will not have much influence on the parity of the banking sector or financial institutes," the analyst said.
Many market participants consider the biggest threat in the creation of a mega-regulator on the basis of the Central Bank of Russia, to be the length of this process, which may have a negative impact on the quality of financial sector regulation, Deputy Finance Minister Alexey Moiseyev told the press on October 12.
One of the concerns raised is that there could be a very long transition period, during which the quality of regulation may slip, the deputy minister said.
"There are different opinions from a resounding 'for' to a resounding 'against.' There are people who believe this idea needs to be put into practice immediately and some that do not think it should go ahead at all, and there are those that think it should happen but in a different way," he said.
However, most market participants agree that the worse thing that can happen is for the process to drag out. In that case "many current issues could suddenly stop working if there is a half-hearted solution or the solution is dragged out," Moiseyev said. "
The main financial bodies have already spoken in favor of unifying financial regulation at the Central Bank of Russia. President Vladimir Putin said at a VTB Capital forum on October 2 that the idea, which has people backing it and people against it, must be discussed with experts without drawing out the decision making. Central Bank First Deputy Chairman Alexey Ulyukayev said he is willing to discuss the creation of a mega-regulator at the Central Bank of Russia if the relevant instruction is issued by the Russian authorities.
