The Russian banking system will survive a slump similar to that of the 1998 crisis when Russia refused to repay its debts. This is the conclusion that IMF experts arrived at while carrying out a so-called stress test of the Russian banking system, Poul Thomsen, the head of the IMF Resident Representative Office in Russia, told reporters today.
According to him, the IMF experts noted that in spite of severe losses suffered by domestic banks, the system would stand out because banks had profited by the last 3 or 4 years to increase their capitalization and strengthen their position. Yet, analysts are worrying about the volume of banking credits growing at a high speed. Experts believe the introduction of certain restrictions in this respect is possible, for the increase in the volume of money lending may seriously damage banks' stability in the event of an unfavorable macroeconomic situation.
Meanwhile, Thomsen noted this was not the only danger for the banking system. The lack of reforms in the banking sector, particularly with regard to the introduction of international accounting standards, and the formal nature of banking supervision are among other negative factors. Another potential threat to the Russian banking system is the fact that the liberalization of cash flows may outride banking reforms.
After WWII, the Soviet army left Austria, and the latter had always remained a neutral state and never joined NATO
Russia experienced default on August 17, 1998. Today, 20 years after those events, the economic situation in Russia does not seem stable to many