Russia needs to issue 150 bln rubles in state securities this year to raise bank capitalization
MOSCOW. July 23 (Interfax) - Deputy Prime Minister and Finance Minister Alexei Kudrin has proposed earmarking at least 150 billion rubles this year to buy preferred shares from banks to strengthen their capitalization.
The State Duma has passed a law that envisions the government issuing securities that would then be exchanged for preferred shares at key banks to raise their capitalization in the event that "it is necessary to prolong loans to companies in the real sector," Kudrin said at a government meeting on Thursday.
"A part of the loans may not be returned and banks' capital will decline as a result," he said.
Such capitalization will ensure a sound foundation to continue lending to companies in the real sector, he said.
"We will submit a proposal for at least 150 billion rubles to be allocated this year" for these purposes, he said.