Russian Finance Ministry reduces 2023 borrowing plan by 1 trln rubles in response to banks' growing appetite for profitability

MOSCOW. Sept 28 (Interfax) - The Russian Finance Ministry has decided to reduce the domestic borrowing program for 2023 by approximately 1 trillion rubles amid the growing appetite of banks investing in OFZs for the rates at which government bonds are placed, Finance Minister Anton Siluanov said.

During the plenary session at the Moscow Financial Forum, Siluanov said that banks now do not want to "give money at normal rates" and expect an increase in OFZ yields.

"We consulted with the Ministry of Finance and the government and decided to limit borrowing this year. We will probably reduce the program by about a trillion rubles. Let them sit now [the banks] and lend to the economy, not to the budget," Siluanov said.

"You can't lend to the economy this way; then we will force the Central Bank to raise the rate even higher. (...) The point of the Central Bank's policy is for us to reduce lending, but they tell us, 'give us more.' So are we going to build a pyramid?" VTB CEO Andrey Kostin asked in response to Siluanov's remark.

"It's always nice when a team of like-minded people sits on a stage," head of the State Duma Budget Committee, Andrei Makarov, who moderated the session, said jokingly.