Bank of Russia lowers reserve requirements for credit institutions

The Bank of Russia has decided to lower the required reserve ratios. Starting from 3 March 2022, these ratios are as follows:

For banks with a universal licence and non-bank credit institutions:

2.00% —— for liabilities to non-resident legal entities (including long-term), liabilities to individuals, and other liabilities (including long-term) in rubles and foreign currency;

For banks with a basic licence:

2.00% —— for liabilities to non-resident legal entities (including long-term) in rubles and liabilities to non-resident legal entities (including long-term), liabilities to individuals, and other liabilities (including long-term) in foreign currency;

New ratios will be applied starting from regulating the amount of required reserves for February 2022.

Other required reserve ratios remain unchanged.

Implementation of this measure will reduce the total amount of required reserves of credit institutions by nearly 2.7 trillion rubles with approximately a 0.7 trillion ruble decrease on the required reserves accounts and a 2.0 trillion ruble decline in the averaged required reserves.

The required reserve averaging ratio for banks with a universal licence and banks with a basic licence is set at 0.9 starting from the averaging period from 9 March to 12 April 2022.

Notably, the Bank of Russia will not sanction credit institutions which fail to average the required reserves in the averaging period from 9 February to 8 March 2022 if the amount of such failure does not exceed 20% of the amount set to be kept in correspondent accounts (sub-accounts) in the above period. If credit institutions fail to average the required reserves and the amount of such failure exceeds 20% of the required reserves to be averaged, the regulator will impose a penalty based on the amount the said failure exceeds the above 20% threshold.

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02.03.2022 20.32.29