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Russian Banks have to much $
Russian banks had never imported as much foreign currency as over the last three months of 2003. Economists reckon that a flow of speculative capital is pouring into Russia, hoping to benefit from the ruble's appreciation. Moreover, speculators are not afraid that "YUKOS risks" would affect major private companies of the country. Many experts had forecasted that businesspeople would initiate massive capital flight in response to the arrest of YUKOS owners. However, these concerns have proven groundless. Data on the balance of payments, published by the Central Bank at the beginning of January, shows that in the fourth quarter of 2003 Russian banks attracted $7.6bn to the country, which is twice more than during 2001 and 2002 combined. Although non-financial companies were exporting capital as usual, the amount of dollars imported by the private sector in the fourth quarter exceeded the volume of dollar export by $2.5bn. The net export of capital by the private sector is declining. "Banks have been converting their foreign currency assets into ruble (assets) over the past quarter," Central Bank First Deputy Chairman Oleg Vyugin explained. Additionally, banks have been actively placing bonds on international markets. Experts estimate that borrowed money has allowed banks to extend the amount of loans granted, which rose by 11 percent in the fourth quarter. Russian banks are inclined to continue converting dollar assets into rubles. According to bankers, the dollar's decline against the euro has exceeded all forecasts, and during the first quarter of 2004 the inflow of foreign capital into Russia may be not less than that at the end of last year, the Vedomosti newspaper wrote.
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