the Russian players in March bought the currency market, but also replenish the cash in cash. So, banks have tried to defend against a RAID of depositors in March the Russians had taken from the banks currency at $5 billion.
In March against the background of the pandemic and the collapse of the financial markets of the Russian banks imported $4.95 bln and €1.13 billion in cash, it follows from statistics of Bank of Russia. Compared to February, the supply of dollars increased by almost 9.6 times. Over the past six years is a record: more banks imported only in March and December of the crisis in 2014 ($9.5 and $10,15 billion, respectively). The import of cash euros in March 2020 has almost tripled compared to February, but the total amount for the month can not be called a record: comparable monthly volumes of the European currency comes to Russia and within 2019.
against the background of cancellation of the transaction OPEC+, the collapse in oil prices and pandemics coronavirus ruble became the second most volatile currency in the world. For the real exchange rate of the Russian currency over the last month, weakened by 12.2% against the dollar and by 13.5% against the Euro, estimated the Bank of Russia (pdf).
Credit institutions were active participants in the foreign exchange market. “Daughters” of foreign banks together with other non-resident buying foreign currency for 389,4 billion rubles., more than in crisis 2014-2015. Support the market during this period were the Russian systemically important banks, which, on the contrary, sold currency, the Central Bank indicated.
the Bank since March 10, has carried out transactions at the “pre-emptive sale of foreign currency” in the framework of fiscal rules — according to him, the fall in oil prices below the threshold level of $42.4 per barrel, the controller starts to sell the currency from the Fund in the interests of the Ministry of Finance. In addition, the Bank began to sell on the domestic market of the currency received during the transaction for the transfer of the government savings Bank, the transactions were carried out with the price of oil below $25 per barrel. During this period, the daily volume of sales of the currency in early March, the regulator bought from the market, reached 13-16 billion rubles.
Operations of the Bank of Russia to provide liquidity to market participants are held in the form of cash. Bank supplies foreign currency to commercial banks, reminds Alexey Mamontov, President of Moscow international currency Association (mica).
“Banks are reinforcing their need for banknotes alone, through the import of foreign currency due abroad. They make these deals with foreign correspondent banks. Several years ago, importers of foreign currency was many Russian banks, now there are “primary operators” of about 10-15. Basically, it is a large state-owned banks and subsidiaries of foreign banks. But the need of the market in banknotes is large banks with a large branch network in the regions, whiche act as suppliers of foreign currency in cash”, — says the expert.
To meet customer demand banks could really need cash, agrees Director Bank ratings Agency NKR Mikhail Doronkin: “Despite the growing share of non-cash foreign exchange transactions (via Internet or mobile banking), overwhelming their volume continues to be made in cash in the offices or operating offices.”
the Regulator attributed this to the growth of consumer activity and an increase in demand for cash before the introduction of the regime of self-isolation on the background of the pandemic. But the outflow mainly affected foreign currency deposits of citizens: in March, the Russians took a record amount of currency for ten years — $5 billion.
With the outflow of foreign currency deposits, in particular, faced VTB (-$1.6 bln), Sberbank ($1.5 billion), alpha Bank (-$458 million), Gazprombank (-$229.8 to), Bank “Opening” (-$162,5 million), follows from their statements on the 1st of April.
“the Sharp rise in the import of cash foreign currency banks indicates to shocks and crisis processes in the foreign exchange market”, — says the analyst of the Bank BKF Maxim Osadchy.
“the Supply of foreign currency in cash desks of Russian banks as at 1 March amounted to $10.5 billion, as of April 1, increased to $14.3 billion — $3.7 billion Need to build up reserves of foreign currency in cash in cash desks and ATMs there were two raids on the Bank depositors — due the collapse of crude oil and the ruble and from the introduction of a tax on deposits and the regime of isolation”, — said the interlocutor of RBC.
VTB purchased additional amounts of cash currency in March “to ensure continuous operations of customers and counterparties”, said the representative of the Bank. Currency liquidity from the Central Bank credit institution is not attracted, he added.
“In March we did not import foreign currency liquidity from the Bank of Russia or the Ministry of Finance is not attracted”, — said the representative of the Moscow credit Bank. The share of foreign currency deposits in the Deposit portfolio of MKB minor, he said.
Bank “Saint-Petersburg” imported foreign currency to maintain a “residues at the box office,” said his spokesman. The volume of such transactions he said were irrelevant.
Sberbank declined to comment. Other major banks did not respond to a request RBC.
According to the Bank, in April, the deposits in banks as a whole increased by 0.8%, but foreign currency deposits fell by 1.1% (pdf). The outflow of foreign currency savings continued for the second consecutive month, although it was weaker than the figures of March (-5,29%). In the first half of may, banks ‘ Deposit base decreased by 0.6%, the Central Bank did not disclose the currency structure of the outflow (pdf).
a Sharp reduction in the outflow of foreign currency deposits and the strengthening of the ruble took the banks in need of cash, MF��melts Osadchy. “The import of cash foreign currency in April, sharply declined,” he says.
From pandemic this spring will not be the traditional growth of demand for cash before holiday season, says Mammoths. “This significantly reduces the demand, is a powerful contractor associated with consumer behaviour. So the import of foreign currency is significantly reduced,” the expert concludes.
