Andrey Sharov, head of economy's state management department at Economic Development and Trade Ministry
Photo: Alexander Miridonov
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CBR to Declare Credit Cooperatives Trustworthy
Economic Development and Trade Ministry announced Monday the agreement with Central Bank of Russia (CBR) to reduce bank reserves for possible losses under the loans given to credit cooperatives. The agreement means credit cooperatives will be able to raise cheaper loans and compete with the banks on the market of small/mid.-business.
The CBR committee for banks’ supervision may amend the regulation on loan reserves already in April, Andrey Sharov, head of economy's state management department at Economic Development and Trade Ministry, said Monday, in time of the conference dedicated to rendering financial services to small/mid.-business.
“The changes will add credit cooperatives and other micro-financial organizations to the second category of borrowers, enabling the banks to establish smaller reserves when granting credits to them,” Sharov specified.
Now the credit cooperatives are treated as risky borrowers with granted loans referred to the third category of risks, i.e. the banks have to build up reserves of 21 percent to 50 percent of loaned amount. Assigning the second category will reduce required reserves to between 1 percent and 20 percent of loaned amount.
“The credit cooperatives supplement the banks, doing it more expediently and less formally,” said Sergey Borisov, president of OPORA organization of small/mid.-business. Such cooperatives cover the fields that are neglected by banks, for instance, the countryside. Moreover, they give chance to a borrower to create credit history for further addressing the banks.
The changes will allow credit cooperatives to attract more funds of the banks and loan them to entrepreneurs in the second move, said Valery Kardashov, senior vice president of Promsvyazbank. According to Kardashov, the changes will hardly drive down interest rates, as they directly depend on the market opportunities.
“We have no practice of crediting cooperatives, just the programs to directly credit individual entrepreneurs,” emphasized Artem Korolev, 1st deputy board chairman at Soyuz Bank. “Therefore, the changes in the CBR requirements related to credit cooperatives exclusively will hardly materially affect general situation of providing credits to small business.”
www.kommersant.com
All the Article in Russian as of Mar. 07, 2006
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