Two big to fail: Russian edition

28.11.2017
In August and September, the Central Bank of Russia (CBR) stepped in to rescue two of the country’s largest private banks – Otkritie FC and B&N Bank. This raised concerns about sector-wide stability.
In August and September, the Central Bank of Russia (CBR) stepped in to rescue two of the country’s largest private banks – Otkritie FC and B&N Bank. This raised concerns about sector-wide stability. In our view, the rescue of these banks should not cause economic or banking sector stress. While some individual banks may have vulnerabilities that could require asset write-offs, better provisioning for losses, capital injections or further interventions by the regulator, we do not foresee any build-up of systemic risks in the Russian banking system.