Source Pravda.Ru

Ex-Finance Minister sees no banking crisis in Russia

There is no banking crisis in Russia and there is no reason for it to happen, believes Alexander Livschits, former Finance Minister and now Deputy Director General of the Russky Alluminii (Russian Aluminum, or RusAl).

"Today I don't think that the banking system needs any protection. It is time to pour water over the carbons," he said when asked whether it was time to protect the Russian banking system.

Livschits deems it sensible to resume stabilization loans for banks who have found themselves in a predicament.

"This is what happened to Kredittrastbank and Sodbiznesbank (they had their licenses withdrawn). When this happened, nearly everyone thought that the same could happen to them. It is worth resuming stabilization loan practice for those who have got into this vortex for unfair reasons," he said.

Livschits stressed that the Russian banking system had not been reformed yet, and this is now particularly obvious. In his words, the Russian banking sector should now develop in three directions: increased supervision, transition to international standards of financial accounting, and "division into the dead and alive."