Central Bank: Over the year, foreign companies made 200 transactions to exit Russian assets

From March 2022 to March 2023, 200 transactions were made to exit foreign investors from Russian assets. Such information in the financial stability review leads Bank of Russia.

According to the regulator, only 20% of transactions involve the sale of large assets, the value of which exceeds $100 million. During this period, five transactions were made that involved actual payments to non-residents of more than $400 million. investment.

“At the moment, the share of foreign companies that have sold their Russian assets in relation to all foreign companies operating in Russia is small,” the Central Bank noted.

The entry of some international automobile concerns had a strong effect on the Russian market. The consumer market was significantly affected by transactions in the catering, clothing and household goods retail sectors, which also affected the commercial real estate market.

The Central Bank is talking about possible bursts of volatility in the Russian market, which may cause payments in the currencies of unfriendly countries to non-residents, but so far this fact has not been a key one. “However, against the backdrop of a reduction in the current account surplus of the balance of payments of the Russian Federation in 2023, these operations may have a more significant impact on the foreign exchange market, so the subcommission will limit the monthly volume of non-residents exiting the Russian market,” the regulator specified.

To mitigate risks after the exit of the foreign owner, priority is given to the buyer with relevant experience and leading players in related industries. In addition, the subcommittee pays attention to the plans of the new business owner and sets key performance indicators. The Bank of Russia, in turn, monitors the financing of transactions, “including controls the increase in the debt burden of the corporate sector and the corresponding risks of banks.”

In May, Russian President Vladimir Putin instructed the government, together with the Bank of Russia, to establish a limit of up to $1 billion for the purchase of foreign currency by residents on the domestic market for transactions that have been approved by the government commission. The deadline for the execution of the order is set until June 1, 2023.