The Central Bank may allow banks to dismiss a capital buffer on unsecured loans on 539 billion rubles
MOSCOW, may 28 (Reuters) – Russian Central Bank may allow banks to dissolve macroprudential capital buffers for unsecured consumer loans to 539 billion rubles to mitigate the impact of rising credit risk, the survey says the financial stability of the regulator.
“In the framework of countercyclical macroprudential policy the Bank of Russia as of the regulatory relief measures can consider the gradual dissolution buffer and unsecured consumer loans,” – said in the review of the regulator.
The buffer size on these loans is 539 billion rubles on April 1, 2020, and account for 5.5% of the portfolio and can provide coverage of realized losses on the loans.
If the decision is made, it will be the third case, when the regulator allows banks to free up capital stock of retail loans, fearing a loss of their main activities.
In April 2020 was dissolved buffer for mortgage loans, which, according to estimates of the Central Bank, banks freed up capital to 126 billion rubles.
“This measure was designed to compensate banks for the losses incurred in connection with the restructuring of loans and to support mortgage lending,” the review says.
All mortgages since the mid-2020 will be significantly reduced risk ratios, which means the release of capital by 200 billion rubles, follows from the review of CBR. However, the new standard “sets for banks responsibility to assess the debt burden of the borrower.”
“We gave concessions, and while they work, to touch the buffers makes no sense. In the future we will see and make possible action on the dissolution of these buffers”. – said the first Deputy Chairman of the Central Bank Ksenia Yudaeva.
So, if all these measures are implemented, the banking system will free up capital to 865 billion rubles.
(Tatiana Voronova, Elena Fabrichnaya. Editor Andrei Kuzmin)