Source: Central Bank of the Russian Federation in English
As of the end of 2019, average yields of the most liquid OFZ bond issues were 72 bp lower than in April 2018 (before the tightening of anti-Russian sanctions), reports the new issue of the Financial Market Risk Review. As of 9 January 2020, the proportion of non-residents’ investment in accounts of foreign depositories with the NSD was 31.5%.
In November-December 2019, non-residents and foreign subsidiary banks notably increased their FX swap positions in the Russian market (up to 7.5 billion US dollars), bringing their aggregate position to the level of July 2019. In the Russian on-exchange market, non-residents and foreign subsidiary banks sold foreign currency for 668.3 billion rubles in 2019, which was positive for FX liquidity. At end of the year, the ruble cross-currency spread expanded by less than 57 bp, which is significantly less than in previous years.
The growth of debt under unsecured consumer loans is slowing down, owing to, among others, the introduction of add-ons to risk weights based on the borrower’s debt burden ratio (DBR). The annualised debt growth rate for the last three months (seasonally adjusted) reached 17.8% as of 1 December 2019, while the nominal annual growth rate was 21.2% (the maximum value of 25.3% was registered as of 1 May 2019).
Banks continue to streamline DBR calculation processes, which will gradually lead to a convergence of the results of debt burden calculations performed in accordance with Bank of Russia Ordinance No. 4892-U and with methods used by banks prior to 1 October 2019. In 2019 Q3, borrowers with DBR of over 80% accounted for 12% of issued loans if the above methods are used. At the same time, this share is 22% of loans issued in November 2019 if the calculations are performed in line with Bank of Russia Ordinance No. 4892-U (24% in October 2019).
15 January 2020