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Russian banks increase liquid forex assets by $8.5 billion in Jan

Published 02/21/2022, 11:24 AM
Updated 02/21/2022, 12:06 PM
© Reuters. FILE PHOTO: A view shows a Russian rouble coin and a U.S. dollar banknote in this picture illustration taken October 26, 2018. REUTERS/Maxim Shemetov/File Photo

By Elena Fabrichnaya and Katya Golubkova

MOSCOW (Reuters) - Russian banks increased their liquid assets held in foreign currencies by $8.5 billion in January to $53.5 billion, the central bank said on Monday, in a sign lenders may try to boost their forex shield in light of fresh sanctions threat.

The United States is considering new sanctions against Russia, proposing to cut some of its top banks from dollar transactions and reducing their ability to service dollar-denominated obligations, sources told Reuters.

Sanctions would come into a force if Russia invaded Ukraine, a move the Kremlin denies is on the cards despite a large Russian troop buildup near its neighbour's borders.

Banks' liquid forex assets, such as cash held by lenders directly and in the central bank as well as short-term loans and other non-rouble tools which could be easily claimed, stood at $45 billion in December, the central bank said in a report.

Earlier on Monday, Russian ratings agency ACRA estimated that the country's banks imported $5 billion worth of forex banknotes in December, double from a year ago, in a pre-emptive step in case sanctions create increased demand.

The central bank declined to comment on ACRA's calculations, nor did it provide a breakdown for the banks' liquid forex assets disclosed in its report Monday.

However, it said that last month, lenders had 21% of their clients forex funds and 15% of banks' liabilities covered by liquidity - a protection cushion if customers demand a speedy withdrawal. That was up from 18% and 13% in December, respectively.

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Although retail clients withdrew 810 billion roubles from their current accounts last month, Russian banks managed to post 164 billion roubles ($2 billion) in January profit, up by 47% from the previous month, the central bank said.

($1 = 79.2050 roubles)

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