Non-residents in January continued to increase investment in OFZ

In January 2020, despite a weakening of investors ‘ interest in assets of emerging markets amid the spread of coronavirus, the share of investments of nonresidents in the OFZ accounts of foreign depositories, NSD increased by 1.8 percentage points, to 33.2% at 31 January, noted in the next issue of “review of the risks of financial markets.” OFZ yield curve at the end of the month does not exceed the levels of the beginning of the year.

Photo: Richard Drew / AP / TASS

Practice of lending money to Russian banks to legal entities at floating interest rates is becoming increasingly common, thereby reducing the vulnerability of the banking sector interest rate risk. These loans are available on average for a longer period, resulting in increased availability of long-term funds in the economy. Thus as the floating rate in most cases used key rate of the Bank of Russia requires banks increased attention to the assessment of basis risk.

The Bank of Russia continues to assess the effectiveness of macroprudential policy measures after the introduction of the debt burden indicator (PDN) for both credit and microfinance institutions. At the end of December 2019, the share of loans to borrowers of credit institutions with PD more than 80% was 23.3%. For the first time the study of personal data of borrowers MFI showed that more than half of the issued micro-loans (53,7%) are in borrowers with a PD of more than 50%, while the 36.9% of the issued micro-loans — for borrowers with a PD of more than 80%.

10 Feb 2020