ANNOUNCEMENT 29 Dec 2014In December 2014, the government of the Russian Federation announced a change in private-sector financial support.
NUMBER OF INTERVENTIONS
On 29 December 2014 Decree Nr. 1592 was signed which aims at increasing the stability of the domestic banking system. Concretely, the document allows the allocation of up to 10% of the funds of the National Welfare Fund into subordinated deposits in Russian banks whose capital exceeds 100 billion Roubles. As is well known in the literature on banks, such schemes confer an implicit subsidy to banks as the lower risk of bank runs and defaults leads to lower financing costs.
The GTA includes state guarantees and other financial incentives thatare likely to affect the restructuring and performance of firms facinginternational competition, whether from imports, in export markets, andfrom foreign subsidiaries.