The Bank of Russia has announced plans to mitigate risks associated with banks’ investments in non-core assets. These assets, which include equity instruments, tangible assets, excess fixed assets, and ecosystems, pose challenges due to their limited liquidity and lack of repayment requirements.
To address these concerns, the central bank will introduce a risk-sensitive limit (RSL). This regulation will determine the level of a bank’s capital necessary to cover immobilized assets that exceed the RSL. The aim is to transfer the risks from depositors and creditors to bank shareholders.
This new regulation will apply to banks with a universal license and is set to take effect in 2026.
In preparation for this change, the Bank of Russia has revised the method for calculating the RSL, initially published in 2021. This revision considers feedback from bank surveys and assesses the impact of implementing the RSL on the sector. Notably, there have been changes such as expanding the list of assets subject to the RSL, reducing the maximum immobilization ratio, and adjusting the timeline for achieving target levels.
Stakeholders are encouraged to provide feedback on this consultation paper by June 27, 2025.
