Russia Central Bank to Bail Out Private Lender Trust Bank - China offers financial help to Russia



Source www.wsj.com/articles/russia-central-bank-to-bail-out-private

Russia’s Economic and Currency Crisis Claims Largest Banking Casualty to DateMOSCOW—Russia’s www.wsj.com/articles/russian-ruble-firms-in-early-trade-1419
has claimed its largest banking casualty to date, after the central
bank said on Monday it will bail out private lender Trust Bank. The bank, famous for its advertising campaign which featured Hollywood star Bruce Willis,
is Russia’s 16th largest by total private deposits and 28th by assets. The
central bank said its board of directors approved a plan for the
Deposit Insurance Agency to act as temporary administrator of Trust
Bank. The bank will receive 30 billion rubles ($532 million) in
central bank credit to support its liquidity and bailout plan, and will
continue its operations. The lender is active in Moscow and other
large cities, offering high interest on deposits and easy consumer
loans. Presently the bank is offering up to 21% annual interest on ruble
accounts and up to 8% on the deposits nominated in foreign currency. Trust
Bank had prospered on burgeoning consumer spending. But with the
economy grinding to a halt and approaching a possible contraction in
2015, consumer spending has slowed causing a rise in the volume of
nonperforming loans across the banking system and a slowdown in consumer
lending.

China Offers Russia Help With Currency Swap Suggestion
Two Chinese ministers offered support for topics.bloomberg.com/russia/ as President topics.bloomberg.com/vladimir-putin/ seeks to shore up the ruble without depleting foreign-exchange reserves.

topics.bloomberg.com/china/
will provide help if needed and is confident Russia can overcome its
economic difficulties, Foreign Minister Wang Yi was cited as saying in
Bangkok in a Dec. 20 report by Hong Kong-based Phoenix TV. Commerce
Minister Gao Hucheng said expanding a currency swap between the two
nations and making increased use of yuan for bilateral trade would have
the greatest impact in aiding Russia, according to the broadcaster. While the offer won’t relieve the main sources of pressure on the ruble -- capital outflow tied to plunging topics.bloomberg.com/oil-prices/
and sanctions linked to Russia’s annexation of Crimea from Ukraine - -
the currency gained 3.1 percent against the dollar by 12:37 p.m. in
Moscow. The www.bloomberg.com/quote/INDEXCF:IND
was little changed, and the yield on Russia’s 10-year bond fell 30
basis points to 13.3 percent, according to data compiled by Bloomberg. “In
the current conditions, any help is very welcome,” Vladimir
Miklashevsky, a strategist at Danske Bank A/S, said by e-mail. “Yet, it
can’t substitute the losses of the Russian banking system and economy
from western sanctions.”
Read more :

www.bloomberg.com/news/2014-12-22/china-offers-russia-help-w


Added:

By: Vivant et libertas (1508.30)

Tags: Ukraine , crises , Russia , Trust Bank

Location: Moscow, Russia

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