On auctions for the provision of Bank of Russia loans, secured by non-marketable assets, with floating interest rate (unofficial translation)

The Bank of Russia External and Public Relations Department informs that starting from 16 September 2013 the system of Bank of Russia monetary policy instruments is extended by the auction for the provision of loans, secured by non-marketable assets, according to Regulation No. 312-P, dated 12 November 2007, “On the Provision of Loans Secured by Non-marketable Assets and Guarantees by the Bank of Russia to Credit Institutions”, for 3-month term with floating interest rate. Credit institutions’ guarantees are not accepted as collateral for the loans provided within these credit auctions.

The floating component of the interest rate on the 3-month credit auctions is linked to the level of the Bank of Russia key rate. The interest rate spread to the key rate on the credit auction is set by the Bank of Russia Board of Directors on 13 September 2013 at 0.25 percentage points.

The conduct of credit auctions for the provision of loans, secured by non-marketable assets, will partially release the market collateral, received by the Bank of Russia for liquidity provision operations, thus contributing to the improvement in the interbank market efficiency as well as intensifying the monetary policy signal.

The auctions for the provision of loans, secured by non-marketable assets, for 3-month term will be conducted quarterly. The parameters of credit auctions will be set with account of the forecast of the banking sector liquidity dynamics and the amount of the market collateral, held by banks.

On 14 October 2013, the Bank of Russia holds the auction for the provision of loans, secured by non-marketable assets, for 3-month term with floating interest rate with the following parameters:

Auction type: Dutch auction.

Maximum allotment: 500 billion roubles.

Minimum interest rate: Bank of Russia key rate effective on the date of the credit auction increased by 0.25 percentage points.

Minimum bid: 25 million roubles.

Maximum number of bids of a single credit institution: 3.

Credit institutions will be informed about their individual maximum allotments additionally.

Auction schedule:

The next credit auction is planned to be held on 13 January 2014.

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