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Russian Banks Lost $1 BN from Deposits in March
12.04.2014 20:27
Russian Banks Lost $1 BN from Deposits in March
Photo Credit: http://valdaiclub.com

In the wake of a sharp devaluation in early 2014, Russians withdrew some 338 billion roubles, or almost $1 billion, from banks in March.

      The total accounts for two percent of deposits in domestic banks, with some of the cash converted into dollars and some invested in real estate.

      The panic had a negative impact on revenue as national lenders earned only 233 billion roubles in 1Q 2014, down 2.5 percent from the same period of 2013.

      Even the biggest banks were hit, including Sberbank, which lost 67.8 billion roubles in deposits in March (-0.86 percent). VTB24 was 13 billion roubles short (-1 percent) while Uralsib’s deposits shrank by 2.7 billion roubles (-2.3 percent).

      There’ve been many concerns about the economic impact of Russia’s move to incorporate Crimea.

      The Russian economy is unlikely to rise above 2 percent in 2014 amid investor uncertainty over the possible impact of sanctions, said the Economic Development Minister.

      According to Alexey Ulyukayev, GDP is expected to grow 1.8-1.9 percent undermined by capital flight worth $100 billion.

      A military invasion of Crimea would cost the Russian economy some three percent of GDP, says Vedomosti.

      Earlier, Russia-IC reported on the possible repercussions of sanctions and investors’ fears on the pace of economic development.

      For example, Bank of America Merrill Lynch forecast that Russia’s GDP would shrink some three percent. The transit of natural gas to European consumers worth $30 billion may be disrupted, too.

      The EU may eventually block the construction of the South Stream pipeline and switch to other energy sources in a move towards an economic boycott.

      Public spending is bound to go up to pay for Crimea’s absorption. The Russian authorities have pledged financial aid to the residents of the autonomy whose budget is facing a $1 billion deficit.

       




Author: Mikhail Vesely

Tags: Russian banks Ukraine crisis Crimea Sberbank  

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