Russian banks are afraid of a new run by depositors

Inside the Russian banking system, risks associated with the possible withdrawal of clients' money from a number of credit institutions are still very real. It follows from the Monday by Raiffeisenbank with reference to the Central Bank.
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About the fear of banks before the flight of money, which led to the rehabilitation fund "Otkrytie" and Binbank, says the behavior of players at the deposit auctions of the Central Bank, says Raiffeisenbank analyst Denis Poryvay.

The Central Bank regularly, once a week, collects free funds from credit institutions, offering them to place money on their deposits at a maximum rate of 1 percentage point above the key one.

Despite the excess liquidity in the whole system, beginning from the end of September, banks are in no hurry to use standard CB deposits with a term of 7 days.

On October 3, the regulator was ready to take 1.36 trillion rubles, but the banks placed only 913.7 billion. October 10, the limit was raised to 1.65 trillion rubles, but banks brought almost twice less - 875.7 billion rubles. The gap in supply and demand became a record for the entire time of deposit operations.

At the same time, Raiffeisenbank notes, if the Central Bank holds auctions of fine-tuning, with shorter terms of placement (from 1 to 4 days), then the limits are chosen almost completely. So, last Thursday (two days after the unsuccessful 7-day auction), the Central Bank offered a short deposit for 2 working days - by 520 billion rubles, and demand exceeded supply.

On Monday, October 16, the Central Bank prolonged it for another day, and demand again exceeded 500 billion rubles.

"The situation in which banks are not ready to place a large volume of liquidity for a week, but can demand for shorter terms (1-2 working days), in our opinion, speaks of the remaining risks within the banking system associated with increased volatility of inflows / outflows client funds on settlement accounts, "says Denis Poryvay, an analyst with Raiffeisenbank.

Because of these risks, banks tend to keep more liquidity in the overnight segment and do not allocate it for longer terms: so, in case of acute need for money, they will be able to quickly use the funds and not to attract expensive funding from the Central Bank.

Almost the entire amount that the Central Bank poured into the banking system in July and August in the form of emergency repo loans of 720 billion rubles, by early October was repaid.

However, at the same time, the Finance Ministry also provided an even larger amount to banks at the expense of the federal budget. Since mid-August, the Treasury has doubled the amount it holds on bank deposits to a record 1.006 trillion rubles.

"The growth of deposits is related to the operations of the Central Bank for the rehabilitation of banks: deposits have largely replaced the funding provided by the regulator," - says analyst Irina Ursibib Lebedeva.

This week, the Ministry of Finance will hold three more deposit auctions for 350 billion rubles, as well as a series of repo auctions - for 1 day, 7 days and 57 days.

"Potentially all these auctions can lead to an increase in the banks' debt to the Treasury by more than 500 billion rubles," Lebedeva said.