What is the decapitalization of banks? Decapitalization of banks in Russia

What is the decapitalization of banks? This is the process of withdrawing its own capital for purposes not related to the production development of this financial institution.

Decapitalization of Russian banks

According to experts' forecasts, in the near futureThe deterioration in the quality of the loan portfolio and the decline in its value should lead to decapitalization of banks. At the moment, the deficit of capital of Russian banks is about 2% of the gross domestic product. Decapitalization of banks is one of the signs of a crisis in the banking sector.

The current state of affairs may deteriorate noticeably,given the concealment by banks of lending to affiliated borrowers. These clients in difficult situations may find themselves unprepared to service their debt obligations. In the winter of 2014, a picture emerged when a significant part of financial institutions showed a rapid decline in the level of capital adequacy.

This process was stopped at a minimumallowed by the Central Bank indicators, and then unexpectedly stabilized, which, in turn, was achieved by improving the quality of the loan portfolio. At the same time, these financial institutions experienced a decline in their own reserves, which could not but arouse suspicion.

What is the decapitalization of banks on a scalecountries? In these circumstances, the Russian government faces a difficult choice. One of the solutions to the problem may be the capitalization of the banking sector at the expense of taxes and fees. On the other hand, you can simply refuse to help those banks, whose leadership has allowed to develop this situation. In this case, the state may well encounter problems caused by the so-called "domino effect".

Which exit?

In the process of studying the question, what isdecapitalization of banks, it is necessary to take into account the fact that it is often justified. The period of destabilization of the foreign exchange market provokes a whole set of risks for Russian banks. So, they are threatened by such a phenomenon as the massive withdrawal of their own funds by investors of these financial institutions. In addition, this threat is exacerbated by the likely launch of the decapitalization of banking institutions.

To avoid such forecasts, banksit is necessary to deal with the accumulation of a liquidity pillow, which will consist of cash placed on correspondent accounts and on the regulator's deposits. In addition, it is possible to use funds located in foreign financial institutions. In the next section, we will find out what the decapitalization of a bank is in the case of VTB.

Decapitalization of VTB

One of the largest state-owned banksfaced with the problem of capital shortage. Decapitalization of VTB Bank led to the fact that the management of the financial institution requested assistance from the government of the Russian Federation. It was about the amount of 200 billion rubles. Moreover, about 70 billion was required already in 2015. VTB had three opportunities to get this money from the state.

The first provided for the allocation of funds from the fundnational welfare and through the purchase of securities from the Ministry of Finance. The second option is the purchase of government-owned corporations with Vnesheconombank's funds. The third option is to use the money from the NWF to finance infrastructure projects through VTB.