VTB CEO calls for closing loopholes in Russian financial system to protect ruble
Date
9/11/2023 8:45:59 AM
(MENAFN) The CEO of VTB, Russia's second-largest bank, Andrey Kostin, has voiced concerns about the need to address existing loopholes in the country's financial system that allow unregulated capital outflows. Kostin emphasized that these loopholes are negatively impacting the value of the Russian ruble. In an interview with the RBK news agency, published on Monday, Kostin highlighted a particular issue: while Russian residents face restrictions on sending more than USD1 million or the equivalent in foreign currency abroad per month, there are no such limits imposed on ruble transfers.
Kostin elaborated on the issue, stating, "There are still loopholes. Let’s say you decide to transfer money abroad, there are restrictions of USD1 million per month, but for rubles, you can transfer as much as you want. What happens next? You transferred a billion rubles to Armenia, and can immediately exchange it for dollars. This possibility should be eliminated." He pointed out that this situation, where rubles can be freely converted into foreign currency without equivalent restrictions, is detrimental to the ruble's exchange rate and overall stability.
Kostin's concerns underscore the importance of addressing these regulatory gaps to maintain the stability and integrity of Russia's financial system. The potential for large ruble transfers to be swiftly converted into foreign currency abroad poses a risk to the ruble's value and could undermine the country's economic stability. As such, implementing measures to close these loopholes is seen as a necessary step to safeguard Russia's financial system and its national currency.
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