Authorities make banks give out money for “combating crisis”

In 2009 Belarusian banks will have to loosen their purse-strings seriously. They are obliged to support enterprises of the real sector of economy.

The government “recommends” them to allocate 9.1 trillion rubles of loans for enterprises of the real sector of economy.

It is almost 1.7 times as much as compared to the last year. It is planned to allocate money for investment projects which had been recognized as the most important by the government. The intention of the Council of Ministers to continue enterprises’ financing, and which is more, in high gear, causes puzzlement among experts, especially considering the present problems with liquidity of the leading banks of the country, which do not have cash surplus, Belorusskiye novosti informs.

As the enactment of the Council of Ministers No. 2068 of December 31 reads, banks are recommended to credit most important investment projects which are to be realized this year. The major burden is to be born by the four largest state banks. Thus, “Belarusbank” is to issue credits for 3.65 trillion Brb, “Belagroprombank” for 1.8 trillion Brb, “BPS-Bank” – 900 billion rubles, “Belinvestbank” – 1.1 trillion rubles.

The government has also given tasks to private banks. For instance, “Priorbank” is to issue 300 billion rubles, “Belvneshekonombank” 230 billion rubles, “Belrosbank” and “Moskva-Minsk” banks 200 billion rubles each, “Belgazprombank” 100 billion rubles.

The former head of the National Bank of Belarus Stanislau Bahdankevich believes that the banks do not have such sums of money (9 trillion rubles). “The entire money stock of Belarus is 20 trillion rubles,” he said to “Belorusskiye novosti”. As said by him, for financing the real sector of economy, banks use money raised from the population as deposits. That is why, he believes, before adopting such decisions, volume of deposits of the population should be analyzed, as well as availability of long-term financial resources in banks. “All this demands serious calculations and estimations, especially under the present conditions. Otherwise we can drive to grave the bank system of the country,” the expert believes besides, he noted that the government should have a complete assuredness that the projects for which money are allocated, would give profit to the country in the future.

The expert noted that deposits, at the cost of which loans are given, have shorter terms. And investment projects are issued for many years. As a result, banks have to support their liquidity all the time because of the time gap.

As the same time, it is difficult for the Belarusian banks to do so. On the contrary, their liquidity is decreasing. In particular, “Belarusbank” has its short-term liquidity index decreased almost three times (from 1.4 to -0.5). Long-term assets of the top bank of the country are growing, while mostly short-term monetary assets are present. They are mostly deposits of citizens. 60% of deposits of the population are concentrated in this bank.

As we have informed, in late 2008 the state increased statutory funds of the four leading state-run banks to 3 trillion rubles. However, it was connected mostly with the intention of the state to preserve the possibility of the banks to give out money in the sphere of housing financing.

Where the banks can find money for financing the real sector of the economy is not clear yet. For instance, “Belarusbank” is to accommodate with loans for 3.6 trillion rubles, and its statutory fund even after having been increased in December is 2.3 trillion rubles.

It should be noted that the government has signed a decree of December 31, but the public learnt about it only one of these days. It means that there was a possibility to reconsider the decision in the first days of the new year considering the new circumstances. But this hasn’t been done.

Crisis is running its course, but that doesn’t concern investment projects of the state.