Vedomosti: Russian banks will benefit from the cessation of trading in dollars and euros
The main beneficiaries of the abolition of trading in dollars and euros on the Moscow Exchange will be Russian banks, mainly small and medium-sized ones, which will be able to increase commissions and their own income due to the arrival of new buyers and sellers. About this with reference to experts write “Vedomosti”.
The chief economist of the investment company Renaissance Capital, Oleg Kuzmin, noted that in order to benefit, banks must not be under sanctions and be able to conduct transactions with external counterparties.
Non-resident banks will also be winners, noted Alexander Isakov from Bloomberg. These could be both European organizations and banks from friendly jurisdictions, but it is difficult to say which specific ones will benefit. Everything depends on the decision of the third countries in which their head offices are located.
However, Kuzmin added, non-resident banks must understand how to relate to possible claims from the US Treasury Department’s Office of Foreign Assets Control (OFAC). The agency may regard increased activity in the foreign exchange market as assistance in circumventing sanctions, which is fraught with secondary restrictions. Large state-owned banks may also benefit from cash exchange transactions for retail clients, he said.
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Anna Nikitchenko, a member of the General Council of Business Russia, noted that new market participants – payment agents – will not miss out on their benefits. Thus, conversion fees will increase. At the same time, he suggested that the situation will lead to the development of financial services towards digitalization and the complication of the results of financial engineering.
According to Isakov, the dollar and euro will not leave the Russian market, as they have been preserved in South Africa since the 1980s and persist in Iran. Sovcombank chief analyst Mikhail Vasiliev recalled that Russia sells large volumes of raw materials, and payments for them in any case are made in dollars and euros, so currency from unfriendly countries will still arrive.
The United States announced sanctions against the Moscow Exchange and the National Clearing Center (NCC) on June 12. The next day, trading in dollars and euros on the site was stopped. From that moment on, the purchase and sale of these currencies is carried out on the over-the-counter market, and the Central Bank sets the rate based on bank reports and information received from over-the-counter trading platforms.
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