The Central Bank of the Russian Federation (abbreviated as Central Bank, or Bank of Russia, or Central Bank) is the main bank of the country, which is responsible for the security and stability of the ruble in relation to other currencies of the world, the development and strengthening of the banking system, supervision of the activities of other banks, issuance and withdrawal licenses.

The Central Bank is the only bank in the country that is engaged in issuing money, that is, producing and issuing cash (minting coins and printing banknotes), as well as replacing old banknotes with new ones.

The Central Bank of the Russian Federation is not a bank familiar to us all, the same as, for example, Sberbank or Alfa-Bank. He is one of a kind and stands above all banks. Schematically it looks like this:

A person from the street cannot come to the Central Bank for a consumer loan; it does not work with individuals, but works with commercial banks, namely, it exercises control and supervision so that bankers conduct their activities honestly. The Central Bank does not interfere in the activities of the banks themselves, but it can revoke a license or, on the contrary, it can help a bank if it has temporary difficulties, for example, to give a loan or take out a bank loan.

History of the Central Bank of the Russian Federation

To understand what kind of organization this is, the Central Bank, it is worth turning to history. In the USSR, the main financial institution was the State Bank. After the collapse of the Union, the functions of the State Bank were transferred to the Central Bank of the Russian Federation, except that the main bank of the country ceased to be a state institution. And it turned into an independent legal entity. The State Bank in the USSR, one might say, was subordinate to the Council of Ministers. After all, it was he who appointed and removed leaders. And most importantly, the Council of Ministers calculated how much money the state needed. That is, the state, through its bank, itself decided how much money was needed, and the bank already printed it in the required quantity.

Today's main banking institution of the country is not subordinate to, but rather interacts with, the same state. Because the Central Bank reports to the State Duma on its activities. State ownership includes the authorized capital and all other assets of the Central Bank. The Central Bank annually sends reports on its activities to the State Duma - on losses and income. In addition, these reports must be published in the media. And the Central Bank is required by law to give part of the profits it receives to the budget. So, we still have to talk about the complete independence of the Central Bank from the state, especially with regard to its activities for the purpose of earning profit.

Where is the Bank of Russia registered and who owns it?

The Central Bank is a legal entity registered in Moscow, where the central authorities responsible for the management and proper functioning of the country's main bank are located.

The authorized capital of the Central Bank of the Russian Federation is 3 billion rubles. The authorized capital, like other property of the bank, is federal property. Legal status means that the bank provides its own work. He transfers 75% of his income to the federal budget.

It turns out that just as any individual can organize an LLC or OJSC and engage in commercial activities, the government has created a legal entity that is engaged in certain activities, which cannot be said to be commercial, since this is not entirely correct. Still, the main task of the Central Bank is to protect and ensure the stability of the ruble, as well as control over banking activities in the country and its proper functioning. The income generated is a side effect of this activity, which is transferred to the main owner, that is, the state.

But at the same time, according to the papers, this is not a government agency. This means that the Central Bank is not responsible for the activities of the state. If the state and the Central Bank have significant gold and foreign exchange reserves on their balance sheet, this does not mean that the Central Bank must repay the state’s debt with these funds. Also, the state is not responsible for the obligations of the Central Bank.

Functions of the Central Bank of Russia

But the main banking institution of the state still controls the money in the country, with the only difference being that the Central Bank cannot print as much money as the country needs. This fact is explained by the fact that the Central Bank is subject to the rules of the International Monetary Fund, of which Russia became a member in 1992.

This was done with the aim of accessing foreign currency loans and was caused by the economic, financial, systemic crisis in the country. At that time, Russia needed financial assistance more than ever. Russia began to receive foreign currency loans to stabilize the economy and interventions to reduce the dollar exchange rate, but at the same time, the Central Bank lost the right to independently lend to the country’s economy, but can participate in lending to other countries. These are the rules of the IMF, whose members are obliged to comply with them.

The first loan was opened in August 1992 for an amount of about a billion dollars, the purpose of which was to maintain the state budget deficit and the rate of inflation. Failure to comply with IMF rules means the exclusion of Russia from its membership, and therefore an automatic denial of access to IMF credit funds. But no one can give a guarantee that they will no longer be needed.

So the Central Bank plays by the rules of the IMF and can only print as many rubles as dollars they could get by selling oil, gas and other things that are quoted on the foreign market for them. Alas, we are now firmly tied to the dollar.

So one of the tasks of the Central Bank is the issue (more simply, the release) of cash, and in connection with this, the organization of the circulation of the cash money supply in the country.

Performs the Central Bank and other functions. All of them are named in the relevant documents regulating the activities of the main bank of the state. You can view these documents using the links below:

In accordance with legislative acts, these goals are as follows:

• in protecting the national currency of Russia from exchange rate fluctuations, which the Central Bank, unfortunately, does not always successfully cope with. Although there are certain explanations for this. First of all, the fall in oil prices is the main product for which Russia earns dollars on the world market.

This is due to the fact that the countries of the Arab world are not reducing the amount of oil they produce, and to the fact that shale oil production has actively begun in the United States. Anti-Russian sanctions played a significant role in the growth of the dollar. Large businesses, whose products were subsequently successfully sold, including for dollars, are being denied long-term loans by European banks due to sanctions.

Another reason follows from the previous one. Demand for the currency pushed its price up. The growth of the dollar is also provoked by other reasons - speculative operations (buy cheaper - sell more expensive), the rise in the world dollar exchange rate itself;

• the development and then the implementation of the credit policy of the Russian Federation, the main postulates of which are reducing the level of inflation, the availability of bank loans to enterprises in the real sector of the economy, stabilizing banking structures, increasing them at the international level, and their ability to provide long-term loans to enterprises of the Russian economy. After all, as you know, large projects are implemented mainly only with credit money;
• establishing rules according to which banking operations are carried out;
• development of measures, and then their implementation for the development of the entire banking system, its modernization;
• ensuring measures for the functioning of payment mechanisms.

And the above are just some of the tasks that the country's main banking institution solves. There are many others. For example:

• The Central Bank issues permission to register a particular non-state pension fund, assessing its capabilities;
• pays debts to clients of bankrupt banks, if a particular bank was not a member of the compulsory deposit insurance system;
• Sets industry standards for accounting charts of accounts.

There are others that we will dwell on in more detail, because it is these tasks performed by the Central Bank that concern the average citizen of the country the most, since it happens that the decision of the Central Bank concerns a person personally.

Issues and revokes licenses

For example, what the Central Bank:

• issues licenses to banking and other credit organizations;
• prohibits banks from operating, which is reflected in the revocation of licenses.

Since the appointment of Elvira Nabiullina as head of the Central Bank, more than 100 banking institutions have lost their licenses to conduct banking activities. This is caused precisely by the task of stabilizing banking structures.

Many of the banks whose licenses were revoked by the Central Bank carried out questionable transactions and implemented risky principles of credit policy, for example, issuing loans without limit. Bank depositors, including individuals, suffer from such excessive love for issuing loans. And definitely - organizations that had a bank account and carried out all their financial transactions through it.

An example of questionable transactions of banking structures

The grounds on which a bank’s license may be revoked are stipulated by law. These may be situations where:

• loan capital is 2% less than required;
• the bank's own funds are below the authorized capital;
• the bank cannot independently pay off all creditors within 2 weeks, the same Central Bank from which a commercial bank borrows money;
• the bank arbitrarily reduces its authorized capital, which becomes lower than the amount of funds at its disposal.

There are also less serious violations, which may result in the bank losing its license.

Determines the refinancing rate

There is one more issue that the Central Bank is deciding and which greatly worries those ordinary people who use credit products from commercial banking structures - this.

There is also another term - key rate. Expressed as a percentage. It is at this interest rate that commercial banks borrow money from the Central Bank. And at their own interest rate, which is correspondingly higher than the one at which they received, they lend to organizations, entrepreneurs, and ordinary residents.

It turns out that a higher refinancing rate means more interest that those taking loans will have to pay to commercial banks. And in Sberbank too - even despite the fact that many people far from the financial sector still consider it state-owned. This is wrong. And even if it were so, do not forget that the Central Bank is not a state structure, the institution does not depend on the state in any way, and the Central Bank also gives loans to this very state, so to speak, although it is a shareholder of Sberbank. More than 50 percent of Sberbank shares belong to the Central Bank.

What does the refinancing rate depend on? Mainly on the level of inflation in the country, that is, the availability of money supply among the population, according to its purchasing power. By increasing or decreasing the refinancing rate, the Central Bank regulates the level of inflation, trying to keep it in check.

With a low rate, purchasing power increases, and as a result, prices begin to rise. They buy a lot, which means that manufacturers produce more products and raise prices. They have the opportunity to produce more products - after all, they can get money from a commercial bank at a lower, more favorable interest rate.

The population also has more funds on hand, including thanks to available credit money. Reducing the refinancing rate to a certain point stimulates the economy. Why until a certain point? Yes, because a reduction in the key rate begins to contribute to the growth of inflation - a process when money depreciates.

And the Central Bank raises the rate. Loans are becoming more expensive, and it is no longer profitable for individuals and legal entities to take them. Over time, the amount of cash in the hands of the ordinary population decreases, consumer demand gradually decreases, manufacturers produce fewer products, and price growth slows down. And that means rising inflation.

Determines the exchange rate

There is one more function that the Central Bank performs and the result of which is of great concern to those Russians who have to exchange rubles for foreign currency - this is the determination of the exchange rate.

The Central Bank does not take the dollar exchange rate out of thin air. This rate is determined taking into account currency trading data on the interbank foreign exchange market. Today the auction took place, tomorrow this rate will be in Russia. So today the exchange rate of the dollar and other currencies is floating. And a return to a strictly established, clearly undervalued exchange rate, which some ordinary people sometimes advocate for, will lead to the same situation that existed in the USSR.

At that time, the officially established price of the dollar, especially in the last years of the Union’s existence, did not exceed one ruble. But it was impossible to buy dollars at that price. They were not on sale. Speculators sold the dollar for up to 4 rubles per green one. And transactions with currency were criminally punishable.

An increase in the dollar exchange rate, as a rule, affects the rise in prices on the domestic market, including consumer goods. After all, the equipment on which these goods are produced, the ingredients, are all, in most cases, imported and purchased in foreign currency.

Management structure of the Central Bank

The fulfillment of the functions and tasks assigned to the Central Bank would not be possible without a clear structural organization of the Central Bank, coordination of its activities with the interests of subjects of state regulation of the economy at all levels - from interaction with the national government to regional governments.

To solve problems in the regions, the Central Bank has representative offices in all constituent entities. Accordingly, the divisions of the Central Bank located in the constituent entities of the Russian Federation are subordinate to the central office.

The main body is the National Financial Council. It consists of 12 members, that is, it is a collegial body. It consists of representatives from the Federation Council (two people from the Federation Council), the State Duma (three people from the deputies), and the Government of the Russian Federation (three people). Three persons are also appointed to the council by the President of the Russian Federation. The Chairman of the Central Bank is a member of the NSF.

The highest executive structure of the Central Bank is the board of directors. It determines the vector of the Central Bank’s activities, sets goals and guidelines for work. In addition to the chairman, the board of directors has 14 other members. They work on a permanent basis. The Board of Directors is also formed under the watchful eye of the State Duma and the President. The Board of Directors meets once a month. And it is he who decides the questions:

• regarding the issue of the ruble;
• sets standards for commercial banks;
• market transaction limits;
• interest rates;
• current loan limits;
• forms a list of securities, which includes bills of exchange used to secure loans from the Central Bank.

The board of directors performs supervisory and control functions, that is, it supervises and manages lower-level structures.

Board of Directors of the Central Bank of the Russian Federation

• central office of the Central Bank;
• territorial divisions;
• RCC – stands for cash settlement centers;
• military divisions of the Central Bank.

The main task of all of the listed structures of the Central Bank is the implementation of certain measures to implement the financial policy adopted by the bank at the federal level.

Who is the chairman

Since 2013, the Chairman of the Bank of Russia since 2013 is Elvira Sakhipzadovna Nabiullina. She is the first woman to hold such an important position at the Central Bank of any G8 country. By law, the State Duma appoints the head of the bank on the proposal of the president.

The term of appointment is 5 years. A person cannot be appointed to the position of Chairman of the Central Bank more than three times in a row.

In some cases, the chairman of the Central Bank may be removed from office. This may be in situations where:

• the term for which the chairman was appointed has expired;
• state of health does not allow to fully perform official duties. Confirmation of health status must be documentary - certificates with the conclusion of a commission of doctors;
• at his own request, the chairman submits a letter of resignation;
• for proven commission of a criminal offense, the court issued an indictment against the chairman;
• the head of the Central Bank violates the legislation regulating the activities of the bank;
• when it is revealed that the chairman or even members of his family keep funds in banks of other countries, when their expenses clearly do not correspond to the officially declared income, that is, corruption occurs.

And here is how the leaders of the Central Bank have changed since its founding:

1. Matyukhin G.G. - from 1990–1992
2. Gerashchenko V.V. - from 1992–1994; 1998–2002
3. Paramonova T.V. - from 1994–1995
4. Khandruev A.A. - from November 8 to November 22, 1995
5. Dubinin S.K. - from 1995–1998
6. Gerashchenko V.V. - from 1998–2002
7. Ignatiev S.M. - from 2002–2013
8. Nabiullina E.S. - from 2013 to the present.

Conclusion

So, now you know what the Central Bank of the Russian Federation is, why it is needed and what functions it performs. We hope this article has expanded your financial horizons.

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central bank

(Central bank)

Central is the body for conducting monetary policy

Information about the activities, policies, functions, operations of the Central Bank, refinancing rate

World central banks Main functions of the central bank Issue of banknotes of the Central Bank Conducting monetary policy Organization of interbank settlements by the Central Bank Management of official gold and foreign exchange reserves Refinancing of credit and banking institutions Conducting the Central Bank's monetary policy Regulation of the activities of credit institutions History of the Central Bank Central Bank balance sheet Sources for the article "Central Bank"

Central bank - definition

Central Bank is the head of the state, who is an intermediary between the state and the entire economy of the state, acting as a monetary policy body, the main functions of which are the issuance of money, banking regulation and supervision. Tools for regulating cash and credit flows are assigned to Central Bank legislation.

Centralbank- This the main issuing center, the main link of the credit system.

Central Bank is state credit institution with the functions money issue money and regulation of the entire credit and banking system.

In various countries such banks are called differently: people's, state, emission, reserve, National Bank of Ukraine, Federal Reserve System of the United States of America, Central Bank of England, National Bank of Germany, People's Bank of Vietnam, People's Bank of the People's Republic of China, National Bank of the Republic of Kazakhstan, Foreign Exchange and Monetary Credit Council of Brunei, European Central Bank, Royal Monetary Authority of Bhutan, National Bank of the Republic of Azerbaijan, National Bank of Ukraine, German Central Bank, reserve bank of india, Federal Reserve System of the United States of America, Emission Institute of French Overseas Territories.

World central banks

In the Russian Federation it is called the Bank of Russia. European Central Bank (English)) - the central bank of the European Union and zone. Formed on June 1, 1998. The headquarters is located in the German city of Frankfurt am Main. It includes representatives of all EU member states. Bank completely independent from other EU bodies.

US Federal Reserve(Fed, Federal Reserve of the United States) - central bank USA. An independent federal agency specially created on December 23, 1913 to perform the functions of the central bank and exercise centralized control over the commercial banking system of the United States of America. The basis for its creation is the Federal Reserve of the United States. IN management The Federal Reserve plays a decisive role, although the form of ownership of capital is private - joint stock with a special status of shares.

National Bank People's Republic of China (PRC)- National Bank Republic of China, a division of the Government of the People's Republic of China. The legal position was finally established on March 18, 1995. This bank is the largest financial institution in the world, given that it has reserves of $3.201 trillion.

Reserve Bank India— central bank India.Reserve Bank of India was founded in 1934 by law on the Reserve Bank of India Act, 1934. began its activities on April 1, 1935. The bank was initially headquartered in Calcutta but moved to Mumbai in 1937. The bank was created as a joint stock company (JSC) and existed in this form until 1949, when it was nationalized by the Government of India.

— Central Bank of Japan. In 1873, based on law on national banks, almost copying the American law of 1863, national banks were established in Japan. On April 1, 1998, a new law on Bank of Japan, according to which the bank became independent from the Ministry of Finance.

Russian Central Bank- the main bank of the first level, the main issuing, monetary institution Russia, developing and implementing jointly with the Government Russian Federation unified state monetary policy and vested with special powers, in particular the right issue of securities banknotes and regulation of banking activities.

Central Bank of Germany(German: Deutsche Bundesbank, the name Bundesbank or Deutsche Bundesbank is also used) - German Federal Bank. German Federal Bank and Federal control financial supervisory authorities of the Republic of Germany together are the financial regulatory authorities Federal Republic of Germany. The headquarters of the Bundesbank is located in Frankfurt am Main.

Banco do Brasil S.A. is the largest bank in Brazil. The bank is a mixed company in which 68.7% of shares are owned by the federal government Brazil. The bank's shares are traded on the Sao Paulo stock market. The headquarters is located in the city of Brasilia. The bank was founded on October 12, 1808 and is therefore considered the oldest in Brazil and one of the oldest in Latin America. It was not only the first Brazilian bank, but also the first Portuguese bank.

Bank France(French Banque de France) - central bank France. It is a member of the European System of Central Banks. The bank has its headquarters in Paris. 1998 - the bank becomes a member of the European system of central banks.

Central Bank of Great Britain European Central Bank Central Bank England, official name in English. Governor and Company of the Central Bank of England) - performs the functions of the central bank of the United Kingdom. The Bank organizes the work of the Monetary Committee politics who is responsible for monetary management politics countries. It was originally organized in 1694 as a private bank, in 1946 it was nationalized, and in 1997 it received the status of an independent public organization, independent in the conduct of monetary policy, the sole owner of which is the Solicitor Ministry of Finance on behalf of the government.

Bank of Mexico (Spanish: Banco de Mexico) - central bank Mexico In 1822, a project was planned to create the Great Bank of the Mexican Empire, which was supposed to begin issuing banknotes. The bank was established in August 1925 Mexico, which began operations and release banknotes September 1 of the same year.

Bank of Italy (Italian Banca d "Italia) - central bank Italy, founded in 1893. The Bank is a member of the European System of Central Banks.Bank Italy was founded in 1893 as joint stock company (JSC). Since 1895, he was entrusted with the management of treasury operations. In 1926, the Bank of Italy received the right to control the credit system and the exchange rate of the lira. In 1936, the bank was nationalized by Mussolini's government and began to perform the functions of a “bank of banks,” that is, it provided loans to other banks.

The Bank of Korea is the central bank of the Republic of Korea. The main task of the Bank of Korea is to maintain price stability. The main task for 2010-2012 - is to maintain the inflation rate within 3.0 ± 1%. It was founded on June 12, 1950 in Seoul according to the “Bank of Korea Act”. Due to the fact that the financial control system changed from April 1, 1998 towards integrated supervision of banks, securities and insurance business, the Bank of Korea began to perform the typical functions of a central bank.

Bank of Canada (English Bank of Canada, French Banque du Canada) - central bank Canada. It is created and regulated by the Banking Act Canada. The Bank of Canada is committed to openly and effectively communicating its goals and reporting its actions to the Government of Canada and the Canadian people. The seat of its leadership is in Ottawa. The bank's manager since February 2008 is Mark D. Carney.

Bank of Spain (Spanish: Banco de Espaca) - central bank Spain. Founded in Madrid in 1782 by Carlos III, it is currently a member of the European System of Central Banks (ESCB). The bank was formally nationalized in 1962. Following the restoration of people's power in the late 1970s, the bank underwent reform of its structure and functions. In 1994, after entering Spain In the European Monetary Union, the Bank of Spain became a member of the European System of Central Banks (ESCB).

The Central Bank of the Turkish Republic (Turkiye Cumhuriyet Merkez Bankası) is the central bank of Turkey. Issue started on December 30, 1925 banknotes Grand National Assembly of Turkey. On June 11, 1930, the Grand National Assembly adopted a resolution on the creation of a central bank. The central bank was founded on October 3, 1931. Turkish Republic, which began operations on January 1, 1932.

Bank Indonesia (indon. Bank Indonesia) is the central bank of Indonesia. In accordance with the decisions of the peace conference in The Hague in 1949, the Bank of Java received the status of the issuing bank of the United States of Indonesia. After the dissolution of the United States in 1950 and the formation of the unitary Republic of Indonesia, the bank continued to perform its functions. On July 1, 1953, the Bank of Java was nationalized and renamed the Bank of Indonesia. In August 1965, the bank was renamed the State Bank of Indonesia. In January 1969, the bank was again renamed Bank of Indonesia.

Reserve Bank of Australia - central bank Australia.In 1911, the Commonwealth Bank of Australia was established, which at that time was the largest commercial and savings bank Australia, since 1924 the bank was entrusted with the issue of Australian currency and the bank was an agency of the Australian Government. The Bank of Australia took on more and more functions as a central bank and in 1945 its status in this role was officially recognized. In 1960, the functions of the central bank were transferred to the Reserve Bank of Australia.

The National Bank of Poland (Polish: Narodowy bank Polski) is the central bank of Poland. The National Bank of Poland began its activities in 1945. Initially it functioned as a state bank under the leadership of the Minister of Finance. Until the end of the 1980s, the bank was monopoly in the banking sector. After the collapse of the communist system, regional commercial banks were separated from the bank, and the National Bank of Poland began to deal only with issues monetary policy. On January 1, 1995, the bank carried out the denomination of zlotys.

The Netherlands Bank (Dutch. De Nederlandsche bank) is the central bank of the Netherlands. The Netherlands Bank was founded in 1814 by decree of Willem I. The bank was a private company, it was given the right to issue banknotes, which were legal tender. In 1948 the bank was nationalized.

National Commercial Bank (). On December 26, 1953, the National Commercial Bank was created by royal decree - the first national bank, which also works according to the principles of European banking.

The Central Bank of the Islamic Republic of Iran is the central bank of Iran, mediating between the state and private banks. In 1927, the State National Bank of Iran was founded, which issued national currency. In August 1960, the Central Bank of Iran was founded, to which some functions of the national bank were transferred. The Central Bank was renamed the Central Bank of the Islamic Republic Iran after the 1979 Revolution. Iran's original "diamond fund" is located in the old building of the central bank.

Classification of central banks

Based on the nature of their ownership, banks can be divided into the following types: State-owned: capital which belongs to the state. Yes, 100% capital the central bank is owned by the state in the UK, Germany, France, Russian Federation, Denmark and the Netherlands; Shareholders: in USA 100% of the capital of the Federal Reserve Banks is owned by Fed member banks; in Italy, 100% of the capital of the central bank belongs to banks and insurance companies; Mixed: in Japan(55% owned by the state and 45% private) and in Switzerland (57% owned by the cantons and 43% private).

Central bank is

Some central banks were immediately established as state banks (in Germany, the Russian Federation); others were created as joint-stock companies and then nationalized (in Great Britain, France). The share of state ownership in the capital of the central bank is the most important factor determining its place in state economy, which largely depends on national traditions and development characteristics banking system However, the Federal Reserve System and the Central Bank of Germany are the most independent of the state, although in the United States the Federal Reserve Banks are owned by member banks of the Federal Reserve System, and in Germany - by the state. Consequently, 100% state participation in the capital of the central bank is more a matter of prestige and tradition. For example, the central bank of Italy, although owned by banks and insurance companies, is more dependent on government agencies.

Central bank is

The second factor determining the independence of the central bank from the state is the procedure for appointing or selecting bank management. On this basis, central banks can be grouped by country. The first group is countries in which the governing bodies of the central bank (and members of the Directorate) are appointed by the government or elected from candidates proposed by the government. This group includes Austria, Denmark, Russia, Germany, and Japan. Belongs to the second group, where the president the central banker is appointed by the council managers bank, which does not include government officials, and then must be approved by the Council of Ministers and approved president countries.

Central bank is

Central bank is

A form of regulation is also the direct government influence of the central bank on the credit system through direct instructions from control bodies in the form of instructions, directives, and the application of sanctions for violations. In some cases, the central bank carries out control for large loans, limiting bank loans, random inspection of credit institutions. However, direct influence methods mainly apply to commercial and savings banks and, to a lesser extent, to other financial institutions.

Functions of the government's financial agent

Being, by their status, the financial agent of the government, central banks carry out operations for the placement and repayment of public debt, cash execution budget, maintaining current accounts of the government, supervising the storage, issue of securities and withdrawal from circulation of coins and treasury notes, as well as the transfer of foreign currency funds when making payments to the government with other countries. By providing such services to the government, central banks receive income, but most of it is subject to deduction to the state treasury.

Central bank is

State lending

In the context of a limited financial base and an imbalance in the financial needs of the state, there is a need to find internal and external loans and borrowings to cover government costs and the state budget deficit, which determines the large role of the central bank in solving these problems. The main form of government borrowing used to finance government costs And state budget, are government loans. Based on repayment terms, there are short-term (up to 1 year), medium-term (up to 5 years) and long-term (over 5 years) government loans.

Central bank is

Depending on the location of placement, government loans are divided into internal, that is, placed within the country, and external, sold on foreign money markets in the currency of either the creditor country, or the borrower state, or in the currency of a third country. According to the method of placement, domestic government loans are divided into freely negotiable, sold by subscription and forced loans; by type of profitability - interest-bearing government loans, for which the hard, and winning, or lottery loans are paid annually in equal shares, income for which it can be received if the bond enters the redemption draw or the winning draw.

Central bank is

Developed countries most actively resort to government loans during economic crises. For developing countries, this practice of attracting loans and borrowings has become typical. The most widespread form of borrowing is deficit financing. state budget.The widespread use of government loans and borrowings inevitably entails a rapid increase in government borrowing, which, in turn, gives rise to new intractable problems. The public debt of individual countries has reached a level at which they are unable to timely fulfill their debt obligations and are forced to resort to their prolongation, that is, lengthening the repayment period or conversion - reducing the amount of interest paid.

Central bank is

Public debt represents the total liabilities of the central government, local authorities authorities, government enterprises and organizations. The total amount of debt is dominated by loans from the central government, despite the faster growth rate of borrowing by local governments. In some states, a debt limit has been established for the debt of the central government. Public debt can come in two forms: direct debt, arising as a result of the use of borrowings by various government agencies, and indirect, resulting from the government guaranteeing private loans and advances. Depending on the sources of borrowing, public debt is divided into internal and external. In countries with developed market economies, domestic debt makes up the bulk of the government's total borrowing - in the UK, for example, its share is about 90%, and in the USA - about 80%. External sources of borrowing are even more widely used in developing countries.

Central bank is

As already noted, government loans and borrowings are provided for various periods, and therefore government debt is divided into short-term, medium-term and long-term. The relationship between them is of great importance. Thus, in conditions of increasing inflation and general instability of monetary circulation, the share of short-term loans in total borrowings increases, since investors avoid investing their funds in long-term government obligations. Borrowers prefer short-term government obligations, which are less associated with the risk of depreciation under the influence of inflationary processes.

Central bank is

The use of internal borrowing by the state is inherently a redistribution operation, during which part of the national income passes from other economic entities to the state. When repaying external credits and loans used by the state, a leakage of part of the national income abroad, which negatively affects the economic situation of the country. The development of government loans was accompanied by the creation of a rather complex structure for managing public debt. The most important activities in this area include determining the sources of new loans and borrowings, their sizes and terms of attraction, methods of placement.

Cash budget execution

Cash budget execution is the organization of reception, storage and issuance of state budget funds, accounting and reporting. According to established world practice, there are treasury, banking and mixed systems of cash budget execution. Under the treasury system, cash execution of the budget is entrusted to special bodies of the Ministry of Finance - assigned cash desks; for banking - to the central bank; with mixed - to the treasury cash desks and to the central bank. In the early stages of development of the credit and financial system, a system of treasury cash budget execution was practiced. As the banking system developed, the function of cash budget execution gradually transferred to banks, mainly to the central bank. In Japan, the cash execution of the budget is entrusted to the Bank of Japan, which is the central bank, and in the USA - to the Federal Reserve Banks.

Central bank is

The cash execution of the budget is based on the principle of cash unity. this means that all mobilized government revenues are sent to a single account of the Ministry of Finance in the central bank, from which funds are drawn for the implementation of government costs. The Central Bank acts as the government's cashier. The unity of the cash register allows the Ministry of Finance to constantly monitor the receipt of funds into the account, monitor the movement of cash, and timely prevent cash gaps. it ensures the centralization of state budget funds and the balancing of income and costs of each of the budgets (federal, local), which together form the country's budget system, and allows operations for cash execution of the budget throughout the country.

The implementation of cash execution of the budget by a single body - the central bank - makes it possible to separate the functions of managing budget funds and managing loans, which are performed by financial authorities and loan managers, and the functions of issuing and storing these funds, which are within the competence of the central bank. As a result, the necessary conditions are created for monitoring the targeted use of budget funds. In the process of cash execution of the budget, central banks accumulate budget revenues, issue financial resources credited to the accounts of the federal and local budgets, keep records of receipts and payments of the federal and local budgets, and provide reports to financial authorities on the cash execution of these budgets, and also carry out a number of other operations.

Central bank is

In some countries, state treasury cash is deposited not only in the central bank, but also in commercial banks. The procedure for the movement of budget funds in the United States is very peculiar, where they are placed not only in the accounts of the Federal Reserve Banks, but also in specially opened government accounts in the largest commercial banks. Treasury current payments are made primarily from accounts maintained at Federal Reserve banks, called "checking accounts." Large sums are placed on them to meet the government's needs for current payments. Government accounts in commercial banks are used to deposit tax revenues and funds received from sales government securities. In this regard, these accounts are called “tax and loan” accounts. There is a close functional relationship between government deposits in commercial banks and Federal Reserve Banks. Tax revenues and borrowings accumulated in government accounts at commercial banks are then transferred to “checking accounts” at Fed banks. If the amounts in “checking accounts” exceed the current needs of the treasury, then the excess, as a rule, is transferred to “tax and loan” accounts at commercial banks.

Banking regulation and control

Banking regulation is a system of measures by which the state, through the central bank, ensures the stable and safe functioning of banks and prevents destabilizing processes in the banking sector. The terms “banking regulation” and “banking control” are often used as synonyms, although they refer to different, albeit complementary, types of activities. Regulation of banking activities means the development and publication by authorized institutions of specific rules or instructions based on current legislation and defining the structure and methods of carrying out banking. These laws and regulations provide a framework for bank behavior that helps maintain a sound and efficient banking system.

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Control over the activities of banks is carried out in order to ensure the reliability and stability of individual banks and provides for holistic and continuous supervision over the implementation of banks’ activities in accordance with current legislation and instructions. Let's get acquainted with the extensive banking control system used in France. The main principles of the system are: double supervision over the activities of banks - by the Ministry of Economy and Finance and the Bank of France; development of specific directions, rules and control functions by regulatory organizations; mandatory participation of banks and other credit institutions in professional associations of enterprises - the French Association of Banks, the French Association of Financial Societies and others, whose central bodies act as intermediaries between supervisory authorities and credit institutions.

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The functioning of the banking system in France is regulated and controlled by 3 main bodies - the Committee of Credit Institutions and Investment Firms, the Committee for the Regulation of Banking and Financial Activities, and the Banking Committee, the activities of which are coordinated by the country's central bank - the Bank of France. Of course, each of these institutions has its own terms of reference and resolves a certain range of issues. The Committee for Regulation of Banking and Financial Activities is headed by the Minister of Economy and Finance. His deputy is the Governor of the Bank of France. It consists of one representative each from the French Association of Banks and Trade Unions, and two personally invited specialists. The Committee establishes rules and regulations for banks on such issues as: the size and structure of the bank’s authorized capital; rules for creating bank branches and representative offices; instruments and rules for granting loans; conditions for acquiring participation in the capital of other banks and enterprises; accounting and reporting rules; internal control rules, etc.

The committee also regulates the relationship between credit institutions and their clients regarding the protection of deposits, determines the boundaries within which credit institutions can operate with the deposits of their clients. The Committee of Credit Institutions and Investment Firms includes 6 members and is headed by the Governor of the Bank of France. The committee consists of: the director of the French treasury and 4 representatives of the banking sector. The Committee gives permission to create a bank or change its status, to carry out banking operations, and also makes decisions on certain issues of the application of banking legislation.

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Banking Committee, headed by the Governor of the Bank of France, including the Director of the Treasury, a member of the State Council, a member of the Court of Cassation and 2 personally invited specialists. This committee oversees all credit institutions in the country and their financial condition. It supervises compliance with legal norms, studies the operating conditions of institutions, as well as the quality of their services. The Committee regularly receives reports from banks on their activities, on the basis of which it schedules inspections directly at banks, as well as meetings with bank management. Based on the results of such inspections, the Banking Committee evaluates the financial condition of banks and makes recommendations to improve the quality of bank management. If the committee finds the bank's financial condition unsatisfactory, it can appoint a liquidator without waiting for bankruptcy proceedings to begin.

The main areas of external control over the activities of French banks are: issuing permission to operate a bank; constant supervision of the bank’s activities by the banking commission; control over the presence of at least one accounting auditor who must work in each bank; the need to comply with rules and regulations; informing tax authorities about the payment of taxes, opening and closing customer accounts, and customs authorities about currency transactions. So, in the organizational structure, all bodies are under the direct control of the French Central Bank and the French Ministry of Finance.

Participation of the Central Bank in public debt management

One of the most important functions of the central bank is participation in the management of public debt, which is formed from the obligations of the central government and local authorities. Public sector enterprises. Public debt management is used simultaneously as a way to resolve public finance problems and regulate supply and demand in the domestic monetary market. As a result, this function becomes complex, since it allows solving specific problems and coordinating budgetary and monetary policies.

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The forms of participation of the central bank in debt management vary, in particular depending on the division of spheres of influence in this regard between the central bank, the treasury and a specialized organization (if one exists). Public debt management is a set of government activities aimed at repaying debt; a mechanism for the formation and implementation of one of the directions of the state’s financial policy related to its activities in external and internal financial markets as a creditor or guarantor.

Activities that facilitate the repayment of government loans include: payments to borrowers; repayment of external and internal loans; provision guarantees; changes in the terms of issued loans; determining the conditions for the issue of money and placement of new government debt obligations, etc. The implementation of measures depends on making informed decisions in the process of managing public debt, which is based on an analysis of the volume and structure of debt, an objective assessment of its current state. In this case, absolute and relative indicators are used. Absolute indicators reflect the volume of government internal and external debt in monetary terms, the amount of costs associated with its repayment and servicing.

The main relative indicators that significantly influence the adoption of administrative decisions and the choice of methods for managing public debt include: the percentage ratio of the loan amount to GDP; the share of costs for repayment and servicing of public debt in the total amount of budget expenditures. To assess public external debt, indicators are also used: percentage ratio of the amount of external debt and the volume of exports in monetary terms, the share of costs for repayment and servicing of public external debt in export proceeds, characterizing the level of debt burden for national economy. Public debt management is a continuous process that includes 3 stages; attracting financial resources by placing securities, repaying and servicing debt obligations.

At the 1st stage, the maximum amounts of government borrowing are determined and guarantees at the next stage, tools for attracting resources and increasing the efficiency of their use are selected. At the 2nd stage, resources are attracted in external or internal financial markets by issuing securities and placing government securities, obtaining a loan or providing government guarantees, and then these funds are used to financing current budget expenditures or investment projects. The 3rd stage consists of searching for sources of financial resources to repay and service public debt, reducing overall costs, and timely fulfillment of debt obligations.

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Government debt obligations are repaid at the expense of budget revenues, the country’s gold and foreign exchange reserves, and funds received from sales state ownership, as well as new borrowings. Methods of managing public debt can be divided into administrative and financial. Administrative methods are based on the quick and precise implementation of individual orders of government and administrative bodies; they do not provide for an assessment of the economic efficiency and results of public debt management actions. Financial methods consist in choosing methods and forms of ensuring the repayment of public debt through the analysis of financial indicators and are aimed at maximizing the effect of attracted loans with minimal costs associated with their repayment and servicing. The most optimal combination of administrative and financial methods is determined by internal and external economic and political factors.

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In conditions of a debt crisis, when the state experiences difficulties in fulfilling previously assumed obligations to repay and service a state loan, the following are used: additional capital investment, restructuring, conversion of loans, cancellation and write-off of public debts. Public debt management directly affects economic growth, inflation, interest rates, employment, the volume of investments in the state economy as a whole and the real sector of the economy.

History of the Central Bank

According to historians, the first central bank was the Swedish Riksbank; it was formed in 1668, but the circumstances of its organization are now little known.

The Central Bank of Great Britain appeared in 1694, when the English government needed a very large loan to wage war with France. gold. The banknotes issued by this bank became a means of payment and entered the country's payment circulation. In addition, the Central Bank of Great Britain was given the right to place government loans, as a result of which a system for managing public debt through this bank was formed. For a century and a half, the Central Bank of England served as a central bank. This was legally prohibited only in 1844 by the act of Robert Pill. This act went down in history because, due to its deep error, it caused great harm to the British economy. In particular, this act prescribed almost 100 percent backing of all banknotes issued in gold in Great Britain. In 1857 this act was repealed. After World War II wars, in 1946, the Central Bank of Great Britain was nationalized and, along with determining monetary policy, it was also given the right to control banks.

In most Western countries, the functions of the central bank have been assigned to certain banks since the mid-19th - early 20th centuries. Thus, the Bank of France became a single emission center in 1848, the National Bank of Germany and the Bank of Spain in 1874, and the Federal Reserve System of the United States in 1913. Historically, in all countries, central banks were formed as large banks with special powers. In most countries these banks were established as joint stock companies. Gradually, central banks monopolized the function of issuing securities, banknotes and other specific functions and established themselves as centers of national credit systems. The selection of one of them from the general number of banks to the role of central means the beginning of the formation of a two-tier banking system, at the top level of which the central bank is located.

In turn, the need to create a two-tier banking system is due to the contradictory nature market relations: on the one hand, they require freedom of enterprise and disposal of private financial resources, and this is ensured by elements of the lower level - commercial banks and credit institutions; on the other hand, these relations require regulation (control and targeted influence), and this circumstance requires, in particular, a special institution in the form of a central bank. The history of many countries has proven that centralization and public control are mandatory prerequisites for the efficiency of the banking system. The highly decentralized operation and development of banking, due to the heterogeneity of paper money, poor regulation and a money supply that does not meet the needs of the economy, introduces additional chaos into an already spontaneous economy. From this point of view, the creation of central banks with the functions of regulating monetary relations was a historical discovery that made it possible to effectively curb the elements of the market while maintaining the freedom of private enterprise.

Central Bank balance sheet

Assets. The balance sheet characterizes the placement and use by banks of the resources at their disposal. Bank assets are divided into income-generating and non-income-generating. Assets that do not generate income include cash on hand, in correspondent (in the cash settlement center (RCC)) and reserve accounts, as well as fixed assets, materials, intangible assets of the bank and immobilized own funds. The bank's income-generating assets are divided into accounting and lending and banking. Active operations represent the use of its own attracted resources, carried out by the bank to obtain a profit. In the process of conducting active operations, banks make investments that bring income in the form of interest, dividends or participation in the profits of joint ventures. At the same time, compliance with certain liquidity standards and rational distribution of risks for certain types of investments are ensured.

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Active operations of banks include: credit operations, as a result of which the bank’s loan portfolio is formed; investment operations that create the basis for the formation of an investment portfolio; cash and settlement operations, which are one of the main types of services provided by the bank to its clients; other active operations related to the creation of appropriate infrastructure that ensures the successful implementation of all banking operations. The results of active operations of banks are reflected in the assets of its balance sheet, the indicators of which make it possible to judge the nature of the investment of the bank’s resources over the past period.

The main areas for placing bank funds are characterized by the following items of bank assets: cash desk; funds in a reserve account with the Central Bank of the Russian Federation; accounts with correspondent banks; attachments in securities and shares; commercial loans issued; interbank loans issued; investments in buildings, structures and other fixed assets; other assets. Management of bank assets consists of establishing and maintaining the procedure for placing raised funds. As a rule, banks seek to place funds by purchasing assets that can bring the greatest return with a minimum level of risk, while focusing on the formation of stock and loan portfolios.

Liabilities.Passive operations of the central bank can be divided into the following groups: Operations for the formation of capital and various types of reserves. Like any bank, the central bank forms, the size of which and the form of formation are enshrined in national legislation. Share of authorized capital in the total volume liabilities is small and, as a rule, does not exceed 5%. Reserve USD/CAD are also formed in accordance with the law. Most often, central banks create free reserve reserves. USD CAD, reserve - Canadian dollar exchange rate differences currencies, etc.

Emission operations. The issue of banknotes into circulation is the main liability item on the balance sheet of the central bank and the main source of its funds. The share of this operation in the total amount of liabilities ranges from 40-90%. At the present stage, the issue of banknotes is completely fiduciary, i.e. not backed by gold. The modern mechanism for issuing banknotes is based on lending to commercial banks, the state and increasing gold and foreign exchange reserves. Thus, the mechanism of money emission determines the credit security of banknotes. The monetary issue of banknotes is secured by bills and other bank obligations, government debt obligations, and only when purchasing currency and gold, respectively, gold and currency. In other words, the assets of the central bank are the backing for the banknote issue of securities. This reveals the relationship between passive and active operations of the central bank.

Deposit operations reflect the obligations of the central bank to the government authorities of the country (funds from the Ministry of Finance, Treasury), as well as to domestic and foreign banks. Up to 40% of the total liabilities of central banks is formed by placing deposits of commercial banks in the form of deductions in accordance with the norms of mandatory reserve requirements. Borrowed loans. These transactions reflect lending undertaken (Special Drawing Rights under International Monetary Fund (IMF)), foreign banks (loans from international financial institutions and other central banks).

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Problems of control over the activities of the Central Bank

Supervision of the activities of the central bank in one form or another is carried out in all leading capitalist countries and is important for the country’s economy as a whole. Thus, the activities of the state Bank of Spain is controlled by a special commission under the Minister of the Treasury (he has an audit service at his disposal). The Central Bank of England is entrusted with the obligation to publish its balance sheet on a weekly basis. And after budget year The UK Central Bank must publish a full report on its activities over the past year. The report is submitted to the Chancellor of the Exchequer. The report details are as follows: a list of banking institutions that are allowed to accept deposits at the end of fiscal year; report of the Banking Supervisory Board; changes that have occurred in published regulations on banking activities.

It is noteworthy that the list included in the report of the Central Bank of Great Britain should be brought to the attention of intelligence any private person who requests this, within a month and for a “reasonable” fee. At this time, the Central Bank of the Russian Federation is accountable to the State Duma of the Federal Assembly of Russia. In addition, the Central Bank of the Russian Federation publishes its balance sheet monthly, data about money circulation, including the dynamics and structure of the money supply aggregate, generalized data on its operations.

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The Central Bank is a government agency that regulates the country's credit and banking system. It is the main link of the system, and is also responsible for ensuring the stability of the purchasing power of the national currency.

Legal status

The Central Bank of Russia is a legal entity. It should be noted that it is not part of the structure of government bodies. However, its property and capital are federal property. The Central Bank and Sberbank of Russia are government institutions. But these are two completely different institutions. The difference is that the former acts as a regulator in the market, while Sberbank is the largest financial institution in the country. Moreover, Sberbank has a branch - the Central Black Earth Bank of Russia. This institution was founded in 2001 as a result of the merger of the Voronezh, Belgorod, Kursk, Lipetsk and Oryol branches of Sberbank.

The regulator has the exclusive right to issue funds. The activities of the institution are not regulated by the Federal Tax Service. It finances its expenses from its own funds, in other words, the Bank of Russia is not responsible for the state’s obligations.

The Central Bank of Russia cannot participate in the capital of other banks, unless otherwise provided by law. Also, the Central Bank cannot be a member of any organization, unless its activities are related to supporting the activities of the regulator. At the same time, a financial institution can participate in the capital of international organizations involved in the development of cooperation in the credit, banking, and foreign exchange sectors.

Goals

The activities of the Central Bank of Russia are aimed at achieving the following goals:

• ensuring the stability of the national currency;
• development of the banking system;
• ensuring the functioning of the payment system.

Tasks

The only institution in the country that has the right to issue banknotes is the Central Bank of the Russian Federation. The main tasks and functions are aimed at achieving this goal:

• Implementation of foreign exchange control by forming mandatory reserves in the Central Bank, setting interest rates, and controlling the growth of the money supply.
• The regulator performs the functions of the government's banker, that is, it stores funds from state budgets and government loans in accounts and provides cash services for them.
• The Bank of Russia does not work with individuals and legal entities, but with commercial banks and other specialized financial institutions. He controls the entire financial system of the country, sets reserve requirements and acts as a lender of last resort.
• The central bank maintains the country's foreign exchange reserves.

To accomplish these tasks, the Central Bank uses the following methods of regulating the economy:

• adjustment of reserve norms;
• transactions with foreign currency on the market;
• refinancing the credit system.

Functions of the Central Bank

• Ensuring the stability of the national currency.
• Issue of banknotes.
• Development of rules for conducting calculations.
• Storage of reserves.
• Bank lending.
• Development of monetary policy.
• Maintaining budget accounts at all levels.
• Issuance of licenses to all financial organizations, control over compliance with the conditions of its use.
• Carrying out all types of banking operations on behalf of the Government.
• Implementation of currency regulation (setting exchange rates, regulating the money supply, etc.).
• Determining the procedure for making payments between countries, legal entities and individuals.
• Development of accounting and reporting rules.
• Development of a forecast balance of payments of the country.
• Conducting analysis and forming a forecast for the development of the country's economy as a whole and by region.

Revocation of licenses in 2016

Last year, the Central Bank of Russia once again broke a record by revoking the licenses of 97 banks. The policy of clearing the market from unscrupulous players has been pursued since the appointment of a new chairman in 2013. In the first six months, thirty-two institutions lost permission to operate; the next year, eighty-six institutions; and in 2015, ninety-three banks.

During the work of the previous chairman, a massive revocation of licenses (59 pieces) was observed only in 2006. A total of 362 licenses were revoked between 2002 and 2012, and 306 licenses were revoked in the previous four years.

Regulatory acts

The Federal Law “On the Central Bank of Russia” dated July 10, 2002 and the Federal Law on BiBD (“On Banks and Banking Activities”) regulate the activities of this financial institution. In turn, the Central Bank has the right to develop regulations on monetary circulation issues. Almost all of these laws are subject to mandatory registration with the Ministry of Justice. Exceptions are made by acts establishing:

• exchange rates;
• change in refinancing rate;
• size of standards;
• any quantitative restrictions;
• operating procedure of the Central Bank system.

Registered acts are sent to all credit organizations in the country.

The Law “On the Central Bank of Russia” provides that the organization’s profit is determined as the difference between income from banking operations, participation in the capital of other financial organizations and expenses associated with the performance of functions.

The organization of the Central Bank of Russia is that this structure is managed by a collegial body - the National Council. It is headed by a chairman who is elected by a majority vote. In total, the council consists of twelve people:

• two members are sent from the Council of the Federal Assembly;
• from the State Duma - three members;
• The President of the Russian Federation and the Government of the Russian Federation each appoint three representatives of the Council.

Council members are appointed to office for four years. Decisions are made by a majority vote with a quorum of seven people and the mandatory presence of a representative. In this case, the opinions of the members of the Council who find themselves in the minority are recorded in the minutes of the meeting.

The National Council resolves the following issues:

• analysis of the annual report;
• issues of development of the banking system;
• directions for the development of monetary policy;
• BR participation in the capital of other organizations;
• appointment of a BR auditor;
• banking regulation;
• implementation of foreign exchange control policy;
• organizing a system of mutual settlements;
• execution of cost estimates;
• preparation of projects in the field of banking;
• making proposals for inspections by the Accounts Chamber.

Chairman of the Bank

The candidate for this position is nominated by the President of the Russian Federation at least three months before the expiration of the powers of the Chairman. A specific person is elected by a majority vote of the State Duma for a period of four years. The same person cannot hold this position for more than three consecutive terms.

Chairman:

• acts on behalf of the Central Bank, represents its interests without a power of attorney;
• is present at meetings of the Council and, in the event of a tie of votes, makes the final decision;
• signs regulations, decisions, minutes of meetings, agreements;
• bears full responsibility for the activities of the Central Bank.

The Central Bank of Russia, together with the Central Office, territorial institutions, cash settlement, computer centers, educational institutions participating in the activities of the Central Bank, forms a vertical management structure.

Results of the banking sector

The profit of all credit institutions in the country increased fivefold in 2016: from 192 billion rubles to 929 billion rubles. The balance of reserves increased by three and a half percent over the year (to RUB 1,352 billion). The volume of borrowings from the Central Bank decreased by half, the volume of Treasury deposits decreased by one and a half times, the share of funds attracted from the Central Bank in liabilities decreased to 3.4 percent, and from the Treasury - to 0.4%.

In December 2016, Russian banks made a profit of 141 billion rubles. (in December 2015, a loss of 72 billion rubles was recorded). The balance of reserves for losses decreased by 4.7%, while in 2015 there was an increase in reserves of four and a half percent. Overdue debt on corporate loans decreased by 8.9%, and on retail loans by 0.7%. In 2015, overdue debt on corporate loans did not change over the year (6.3%), while on retail loans it decreased to 7.9%. To obtain more reliable information about the financial condition of borrowers, by the end of 2017 the Central Bank plans to create a register of collateral for loans. This will allow us to monitor and prevent the emergence of the main problem of the banking system - issuing loans to borrowers who cannot provide high-quality collateral.

Statistics on the Central Bank key rate

The Federal Law “On the Central Bank of Russia” stipulates that the regulator may change the key rate in order to ensure the stability of the ruble. It was introduced by the Central Bank back in 2013 as a measure to transition to an inflation targeting regime. The Central Bank also forms an interest rate corridor, regulating the liquidity of the banking sector.

From 01/01/13 the refinancing rate was equal to the key one. For the first time, the value of these two indicators was changed by the Central Bank of the Russian Federation (Bank of Russia) on September 13, 2013. The value of the key rate for the purposes of providing and absorbing liquidity was five and a half percent. Just five months later, in order to tighten monetary policy, the key rate was increased to seven percent per annum. This made it possible to prevent a strong rise in inflation against the backdrop of increased market volatility.

The next increase took place on April 25, 2014. Due to growing inflation risks, the rate increased to 7.5%. In the next six months, there were two more rate increases: to 8% (07/25/14) and 10.5% (12/12/14).

On December 16, 2014, the Bank of Russia increased the key rate to 17% per annum. Additionally, floating 1.75 percentage points were introduced, provided for loans against non-marketable assets. Such loans were previously serviced at a fixed rate.

Taking into account the accelerated growth in consumer prices, the regulator on January 30, 2015 reduced the rate to 15%. These changes did not coincide with the forecasts of analysts, who believed that the Central Bank would not change the rate. Inflation in the Russian Federation remained high, and the ruble remained weak. There were no prerequisites for reducing the rate. For the same reason, the key rate was reduced four more times: to 14% (03/13/15) and to 12.5% ​​(04/20/15), 11.5% (06/16/15) and to 11 % (07/31/15).

Gold reserves

International gold and foreign exchange reserves are highly liquid financial assets that are at the disposal of the Bank of Russia and the Government. They include foreign currency assets, monetary gold, special drawing rights and other reserve assets. Gold and foreign exchange reserves are one of the instruments for regulating monetary policy.

In December 2016, the regulator suspended gold purchases. At the beginning of 2017, the country's gold and foreign exchange reserves amounted to 51.9 million ounces. This figure did not change for the month of December. At the same time, the value of reserves decreased by 2.4% due to price fluctuations. This resulted in a reduction in total reserves by 15.9%.

In 2016, the Central Bank purchased 200 tons of gold, which is 9 tons less compared to 2015. As a result, the volume of gold reserves increased by 14.1%, and their monetary value increased by 24%. Over the past five years, the most active purchases of gold were observed in 2014, when the Central Bank purchased 5.5 million troy ounces of gold.

The main institutions providing credit are banks. Banks- financial institutions that accumulate and store funds, provide loans, carry out money transfers, as well as other operations in financial markets. A set of interconnected banking institutions operating in the country makes up the banking system. The banking system is an organic and integral element of the economy. This means that the functioning of banks should be considered in close connection with all processes occurring in the economic life of society.

Most countries with market economies have a two-tier banking system. The first level consists of the central bank and its institutions. Historically, central banks arose from the centralization of money supply (issue of banknotes) into reliable banks. Such banks are called emission banks. At the end of the 19th - beginning of the 20th century. in most countries, the issue of paper money was concentrated in one bank, which was called the central issuing bank, and then simply the central bank. It occupies is, as a rule, a government agency. As the government's banker, the central bank acts as its teller and lender, and holds accounts for the government and government departments. The Central Bank, as a rule, carries out cash execution of the state budget. Government revenues from taxes and borrowing are deposited into a non-interest-bearing account of the Treasury (Ministry of Finance) at the central bank, from which government expenses are financed. The functions of the central bank are as follows:

Issue of money. This is one of the most important functions. Although cash is less important than non-cash money in modern conditions, central bank note issuance remains important because cash is still needed for a significant portion of payments;

Storage of the country's gold and foreign exchange reserves;

Providing loans and performing settlement transactions for government agencies;

Accumulation and storage of cash reserves of commercial banks. Each bank is required to keep in a reserve account at the central bank an amount in a certain proportion to the amount of deposits;

Lending to commercial banks. The following analogies can be drawn here. If firms, organizations and individuals are given loans by commercial banks, then for the central bank the clients are commercial banks;

Regulation and supervision of the activities of commercial banks and other credit institutions. The Central Bank has the right to issue and revoke licenses of commercial banks;

Monetary regulation (together with the government).

The capital of the Central Bank of the Russian Federation is entirely owned by the state. The tasks and functions of the Central Bank of the Russian Federation are formulated and enshrined in the Constitution of the Russian Federation and the Federal Law “On the Central Bank of the Russian Federation (Bank of Russia)”.

The second level of the banking system consists of commercial banks. Commercial Bank- a universal type of bank, engaged in a wide range of operations, the most important of which is the provision of loans to industrial, commercial and other enterprises, mainly at the expense of funds raised in the form of deposits. All over the world, commercial banks - the most important link in the banking system - concentrate the bulk of credit resources and carry out a wide range of banking operations and financial services for legal entities and individuals. Commercial banks can be classified according to a number of criteria.

By the nature of their ownership, commercial banks are state-owned, joint-stock, cooperative, private, municipal, and mixed. In industrialized countries, the predominant form of ownership of commercial banks is joint stock.

According to the nature of the operations performed, universal and specialized commercial banks are distinguished. Universal banks perform a wide range of operations and services. Universality means a type of banking activity that is not limited by sectors of the national economy, the composition of clients served, the number of transactions performed, or regions. Specialized commercial banks carry out one or a small number of banking transactions. These include investment, mortgage, savings, innovation, insurance and other banks. Investment banks carry out operations to issue and place securities on the stock market, thereby receiving income; They use their capital to lend to various enterprises and entire industries. Mortgage banks specialize in providing long-term loans secured by real estate. Savings banks attract free funds of the population, store savings, carry out non-cash payments, provide loans to the population, carry out settlement and monetary transactions to serve the population, including transactions with securities. Innovative banks carry out lending at all stages and stages of the innovation process of creating and implementing various innovations and scientific and technical developments. Insurance banks raise funds by selling insurance policies. They invest the income received, first of all, in bonds and shares of other companies, government securities, and also provide long-term loans to enterprises and the state. At the present stage, in the field of activity of commercial banks there is a tendency towards universalization, which is explained by the influence of competition. This is reflected not only in an increase in the number of services offered to clients, but also in a qualitative change in the structure of operations, an increase in the volume of transactions with securities and a decrease in the share of savings and loan operations.

According to the industry principle, commercial banks can be divided into industrial, agricultural, construction, trade, etc. In Russia, for example, these are Neftekhimbank, Elektrobank, Rosselkhozbank, Promstroybank, etc. The main functions of commercial banks:

Mobilization of temporarily free funds and turning them into investments. Banks accumulate cash income and savings in the form of deposits. The depositor receives remuneration in the form of interest or services provided by the bank. Savings concentrated in the form of deposits are converted into loan capital used by the bank to provide loans to enterprises and entrepreneurs. The use of credit ensures the development of the productive forces of the country as a whole. Borrowers invest in expanding production, purchasing real estate, and consumer goods. As a result, with the help of banks, savings are converted into capital;

Lending to enterprises, the state and the population. Direct lending of free funds by their owners to borrowers is difficult in practical economic life. The bank acts as a financial intermediary, receiving funds from final lenders and giving them to final borrowers;

Issue of so-called credit money into circulation. This function is specific and distinguishes commercial banks from other credit institutions. The modern mechanism of money emission is associated with two concepts: banknote and deposit emission. Banknote issue is carried out by the issuing bank (central bank). Commercial banks carry out deposit issuance - the issuance of credit instruments that are formed as a result of issuing loans to a client. The money supply increases when banks make loans to their customers and decreases when loans received from banks are repaid. At the same time, the economy needs the necessary, but not excessive amount of money, so commercial banks operate within the limits provided by the state represented by the central bank;

Carrying out settlements and payments on behalf of clients. Most payments between enterprises are carried out non-cash. Acting as payment intermediaries, banks perform transactions for their clients related to settlements and payments;

Issuing and founding activities. This activity involves the issue and placement (sale) of securities by banks. Here banks become a channel for channeling savings for productive purposes;

Consulting, provision of economic and financial information. Having the ability to constantly monitor the economic situation, commercial banks provide clients with advice on a wide range of problems (on new investments, on registering enterprises, on drawing up annual reports, etc.).

There are usually four groups of banking operations; passive, active, banking services and banks' own operations. Passive Operations- operations to attract funds to form bank resources. The bank's resources are formed from its own and attracted (borrowed) funds. To create a bank, a certain amount of equity capital is initially required. Own funds include share capital, reserve capital, and retained earnings. Own funds make up a small part of the resources of a modern bank. Basically, banking operations are based on borrowed funds. In economically developed countries, the ratio between equity and borrowed capital ranges from 1:10 to 1:100 (does not exceed 10%). Sources of borrowed funds that form the bank’s capital include financial obligations to bank clients (deposits, savings deposits) and financial obligations to other banks. The overwhelming majority of all banking resources are formed from deposits of bank clients. Loans received from other banks are a normal credit transaction. Also a source of raising funds for the bank are issuance operations, which consist of the bank mobilizing funds in exchange for issuing certain foam securities. Active Operations are carried out by the bank for the purpose of profitable placement of raised funds. Active operations of the bank include credit operations - operations to provide loans and advances, and stock transactions- various operations of banks with securities: purchase of securities, placement of newly issued securities among holders, purchase and sale of securities on behalf of a client, etc. Banking services As a rule, they are intermediary operations - collection, letter of credit, transfer, trust, leasing, etc. For their provision, clients are charged a special fee, called a commission. TO banks' own operations These include operations related to the bank’s performance of its functions: the purchase of banking equipment, bank security, payment of wages to employees, transportation costs, etc.

Probably every person knows about the existence of the Central Bank, but do we appreciate its true importance? To maintain order in the State, in particular in the economic sphere, it is necessary to have a clear financial structure. A guarantee of stable work is the distribution of responsibilities and powers between economic entities. Every State in the world must have an independent control body over financial and economic activities. In the Russian Federation, such a body is the Central Bank.

It has long been clear that the financial system needs to be regulated centrally. The first Bank, which performed the functions of the modern Central Bank (but not all) was established in 1860. Over time, its name, chairmen, economic and political situation changed, but the immediate predecessor of the Central Bank was the State Bank, which began to exist at the end of 1987.

It was a republican bank created under the USSR, which submitted a report on its activities to the Supreme Council of the Russian Soviet Federative Socialist Republic (RSFSR). It was called “State Bank of the RSFSR”.

During the collapse of the USSR, the authorities decided to transform the Bank of the RSFSR. And already on July 13, 1990, the Central Bank was established, and it began its legal activities in accordance with the adopted law “ About the Central Bank of the RSFSR"No. 394-1 dated December 2, 1990.

The Central Bank was given the status of a legal entity and declared the main bank, which, like the State Bank, was required to submit reports on its activities to the Supreme Council of the RSFSR. In fact, the Central Bank became the successor to the State Bank.

Since November 1991, the Central Bank has been given powers over the most important functions, namely, issuing the ruble and determining its exchange rate. Thus, his responsibilities included complete monopoly regulation of the republican economy.

After the final collapse of the USSR and the emergence of a new, independent State, the Central Bank of the FSRSR was renamed “ Central Bank of the Russian Federation" All assets, liabilities and property of the Soviet bank were transferred to the Central Bank of the Russian Federation.

With the advent of the Central Bank in Russia, dramatic structural changes took place in the economy:

1. All past republican branches of special banks were transformed into a network of commercial banks;
2. The new financial regulator changed the system of accounts (cash settlement centers - RCCs) became an innovation;
3. A legal foreign exchange business has emerged in Russia (since 1992, the Central Bank began purchasing/selling currencies).

The Central Bank was authorized to establish and determine official quotations (the ratio of foreign monetary units to the Russian ruble). The direct merits of the Central Bank of the Russian Federation also include the organization of a stable securities market.

In September 1993, the Central Bank decided to shift some of its functions to another executive body and proposed its idea to the Government. Thus, to assist the work of the Central Bank, a new federal service was created called the Federal Treasury. The main responsibilities of the Treasury at that time included:

1. Ensure the execution of the federal budget;
2. Provide cash services for budget execution;
3. Monitor the conduct of transactions with federal budget funds by the main managers and recipients (as well as conduct preliminary control).

In 1995, the Central Bank operated a system that consisted of carrying out a total inspection of existing commercial banks and currency regulation mechanisms. This system maintained the banking system in stability.

From the moment of the collapse of the USSR until the first Russian crisis, the Central Bank did a colossal amount of work to form the economic foundations of the country, as well as its financial stability. However, in 1998, the country suffered a severe economic crisis, the main reason for which was the ineffective macroeconomic policy of the authorities. And already in mid-August 1998, the Russian Government announced a statement from the Central Bank about a technical default of the main types of government securities.

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After the crisis, there was a change in the composition of the State Government and the head of the Central Bank. For economic rehabilitation, the following measures were taken:

1. Easing monetary policy;
2. Containing rising prices for monopoly products;
3. Restructuring the banking system to increase the liquidity of commercial banks;
4. Creation of ARCO (Agency for Restructuring of Credit Institutions);
5. Creation of the ICC (Interdepartmental Coordination Committee for Promoting the Development of Banking in Russia).

On March 3, 2014, it was decided to abolish the Bank of Russia Financial Markets Service (SBFRS). The powers that were previously exercised by the SBRFR (which means control and regulation of financial market entities) were transferred to the Central Bank of the Russian Federation. By the end of 2014, the Central Bank of the Russian Federation switched to a “floating” exchange rate regime, that is, it refused to carry out foreign exchange transactions in order to influence the dynamics of the ruble exchange rate. To date, the Central Bank, led by Chairman Elvira Nabiullina, has opposed the introduction of changes to the currency control system.

Heads of the Central Bank

The Chairman of the Bank of Russia is the official head of the Central Bank of the Russian Federation. The head acts on behalf of the Bank of Russia and represents its interests. Like any boss, the chairman of the Central Bank has the right to appoint employees to positions, as well as dismiss them, including deputy chairman of the Bank, and also assigns certain responsibilities to them.

Naturally, every regulatory or financial document goes through verification and is signed by the chairman of the Central Bank.

Interesting moment! When at a meeting of the board of directors of the Central Bank of the Russian Federation there is a tie in voting on a certain issue, the vote of the chairman of the Bank of Russia is decisive.

The candidacy of the Chairman of the Central Bank is proposed to the State Duma by the President. To approve a candidate for a position, it is necessary to go through a voting procedure, according to the standards of which, the candidate who receives the maximum number of votes wins. The term of office in this position is limited to 4 years, but the maximum time a person can hold this position is permitted by law for no more than 3 consecutive terms.

The Central Bank appeared back in 1860, or to be more precise, on June 11. Only it was called differently, in a royal way: “the State Bank of the Russian Empire.” The Table shows the main chairmen of the Central Bank from 1980 to the present, as well as the name of the bank at one time or another.

Name of the bank	Chairmen of the Board
State Bank of the Russian Empire (1860-1917)	Stinlitz Lamansky Zhukovsky
People's Bank of the RSFSR (1917-1920)	Pestkovsky Obolensky Ganetsky
State Bank of the USSR (1921-1991)	Sheinman Kalmanovich Maryasin Kruglikov Grichmanov Bulganin Korovushkin Poskonov Sveshnikov Dementsev Garetovsky Gerashchenko
Central Bank of the Russian Federation (1991-today) day)	Matyukhin Gerashchenko Paramonova (acting) Ignatiev Nabiullina (today)

From June 24, 2013 to the present, the Chairman of the Board of the Central Bank is Elvira Sakhipzadovna Nabiullina. The previous Chairman, Sergei Mikhailovich Ignatiev, is on the Board of Directors of the Bank as an advisor to the Chairman.

In addition to the Chairman, the bank is managed by a Board of Directors, which consists of 14 people, including Nabiullina. Members of the Board of Directors are appointed by the State Duma for a period of 5 years. The duties of the council include holding meetings at least once a calendar month. The Bank of Russia has another collegial body among its assistants - the national financial council, consisting of 12 people, including the chairman. Council meetings must be held at least once per quarter.

The main functions of the national council include:

1. Approval of proposals of the board of directors;
2. Consideration of issues related to improving the banking system of the Russian Federation;
3. Selecting the optimal option for the main directions of the state’s unified monetary policy from all those proposed;
4. Appointment to the position of chief auditor of the Central Bank and determination of an audit organization (auditor of annual financial statements);
5. Consideration of issues related to the current activities of the Central Bank.

Interesting moment! Participants of the National Financial Council (NFC) are not employees of the Central Bank and do not receive remuneration for their activities (with the exception of the chairman of the bank).

Distinctive features of the Central Bank of Russia

The main distinguishing feature of the Central Bank is its name. A center is a symbol of the basis of something; it turns out that the Central Bank of the Russian Federation is the “center” of all banks in the country. Hence its privileges: an absolute monopoly on the issue of banknotes, regulation of the stability of the national currency, endowment with property and financial independence.

Another fundamental difference between the Central Bank and other Russian banks is that it does not provide financial services to the population and does not lend to private businesses, but is a regulatory body of the country’s financial and economic system, acting as a link between economic entities and the Government.

Note! Making a profit is not the purpose of the Bank of Russia!

The uniqueness of the Central Bank of the Russian Federation lies in the fact that it combines some features of a commercial institution and a government department.

Legal status as the main distinctive feature of the Bank of Russia

The unique Russian Bank acts as a special public legal institution in the country's economic system.

The defining element of the legal status of the Central Bank is the principle of independence, the essence of which is reflected in the Constitution of the Russian Federation (Article 75), as well as in the first two articles of Federal Law No. 86 " About the Central Bank of the Russian Federation (Bank of Russia)" dated July 10, 2002.

What is the principle of independence? Literally, this principle means the exclusive right of the Bank to issue money and organize money and currency circulation.

The Central Bank of the Russian Federation is not responsible for the obligations of either the state or credit institutions, and this is mutual between them.

Interesting fact! The Bank of Russia has the right to defend its interests in court! (Including in international courts, as well as courts of foreign states and arbitration courts).

Paradoxical moments

If you thoroughly understand the legal status of the Central Bank, you will notice several paradoxical points. For example, Article 75 of the Constitution of the Russian Federation states that the Central Bank of the Russian Federation has a special constitutional and legal status, which gives it the exclusive right to monopoly issue money and ensure the stability of the ruble, regardless of government bodies. That is, in fact, the Bank is independent in its decisions, and given the functions it performs, the Central Bank can be equated to a state authority. But, in fact, the bank is not such.

And also illogical points can be identified in terms of the independence of the Central Bank. The principle of independence is also reflected in the financial independence of the Bank; everything is simple here: it carries out its expenses at the expense of its own income. But the authorized capital and other property of the Central Bank belongs to the Federation, that is, it is federal property, and not the property of the bank (this is such independence).

All property of the Central Bank belongs to the Russian Federation, but the seizure of property without the consent of the Bank of Russia is not allowed.

And in general, all powers to use, dispose and own the property of the Central Bank are exercised by the Bank itself, in accordance with established government goals.

Functional responsibilities of the Central Bank of the Russian Federation

The Central Bank of the Russian Federation is a legal entity and operates within a clearly defined government framework. The functions performed by the Central Bank are at the same time its responsibilities. The Bank of Russia, working for the benefit of the state, is obliged to:

1. Ensure the stability of the national currency and the stability of the Russian financial system;
2. Monitor inflation rates and, if necessary, work to reduce the rate;
3. Develop a unified monetary policy of the state;
4. Report on your activities to the State Duma of the Federal Assembly of the Russian Federation;
5. Increasing financial literacy (culture) of the population;
6. Monitor the activities of all commercial banks (monitor economic results, guided by the reports of banking entities, organize audits of the operations they perform);

The Bank performs all of the above functions based on the approved Instructions and Regulations.

Banking regulation as one of the special functions of the Central Bank

In order for the system to function as a coherent mechanism, it is necessary to strictly adhere to the rules of “behavior” of each subject of the link in this system. The same applies to the banking sector. The Central Bank monitors compliance with rules and order by all other “non-central” banks.

Banking activities are considered legal only if he has a license to operate. This license is issued by the Bank of Russia. In order for a commercial bank to obtain the coveted permission and begin to legally carry out its activities, its founders need to submit certain documentation to the Central Bank. An approximate list of documents for consideration of issuing a license looks like this:

1. Application for a license;
2. Charter (and other constituent documents);
3. “Business plan” of action (which indicates the nature of future banking operations and the scale of operation);
4. Declarations of income of the founders, as well as an audit report on the financial position of the founders of the bank.

The Bank of Russia is also entrusted with control over non-credit organizations (these are pawnshops, microfinance organizations, credit history bureaus, non-state pension funds and others).

As part of the regulation and control of the activities of banks, the Central Bank of Russia checks their financial statements, but not itself, but through the means of another of its assistants - the audit service. Auditing firms that engage in banking audits must also obtain a license to carry out their activities. This license is also issued by the Central Bank.

If, as a result of the inspection, it is revealed that a bank or other credit institution does not comply with the requirements established by law, then the Central Bank has the right to deprive this organization of its license. This function is assigned to the Bank of Russia to improve the banking sector. Currently, the fight against credit institutions that conduct questionable transactions or have low-quality assets on their balance sheets continues in a more stringent form. In 2017, the Central Bank revoked the licenses of 50 credit institutions, and over the past four years - more than 350 banking entities.