September 26, 2017 / 10:57 AM / a year ago

Russian plans to tighten rules on banks' exposure to shareholders

MOSCOW, Sept 26 (Reuters) - Russia’s central bank plans to tighten requirements for how much banks may lend to their shareholders, Deputy Central Bank Governor Vasily Pozdyshev told a conference hosted by the Fitch ratings agency on Tuesday.

“The banking system’s birth trauma is lending to banks’ own shareholders. We will tighten risk requirements for the (banks’) shareholders’ business further,” Pozdyshev said.

In less than a month, the central bank took over two large private banks, Otkritie and B&N bank, saying they had been growing too fast, while also funding businesses of their owners and not setting aside proper provisions to cover for expansion. (Reporting by Kira Zavyalova and Jack Stubbs; writing by Katya Golubkova; editing by Dmitry Solovyov)

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