Named the reason for the record outflow of foreign currency abroad in September

“Due to partial mobilization, the Russians began to act impulsively”

September was marked by a record outflow of currency abroad: the Russians transferred $6.7 billion to accounts in foreign banks. According to experts, the whole point is the partial mobilization announced this month. Thus, what happened is strictly tied to a specific political event and is of a one-time, situational nature. As for the negative consequences for the banking system, they are minimal, since the amount itself is relatively small against the background of the total volume of household deposits.

According to the Central Bank, at the beginning of the year, Russians kept $30.6 billion in non-resident banks, and today – $60.1 billion. That is, the amount has doubled. The first major surge in cash outflows came in February, when about $4.3 billion was transferred abroad, the highest since 2018. In the spring, when the regulator approved limits on the withdrawal of foreign currency, the volume of such operations dropped sharply: in March, citizens withdrew $1.7 billion, in April – $1.4 billion, in May – $1.7 billion. eased its restrictions, the volume of transactions of Russians in favor of foreign banks tripled to $5.2 billion in June.

Meanwhile, all these figures fade against the background of the total mass of liquidity that the population continues to keep on accounts and deposits in Russian credit institutions. Today it is about 30 trillion rubles ($496 billion). Moreover, the share of funds in rubles is close to 80%. To withdraw money, citizens more often than other countries choose Kazakhstan and Georgia. Thus, over the year, the volume of balances on deposits and current accounts of Russians in banks in Kazakhstan increased 3.5 times, to 88.1 billion rubles, and in Georgian banks – four times, to 70.8 billion rubles.

“Of course, the September surge is associated with partial mobilization and the fact that because of it, part of the citizens moved to Kazakhstan, Uzbekistan, Turkey, Georgia and other neighboring countries, where they opened bank accounts,” says Artem Deev, head of the analytical department at AMarkets. “And someone in our country began to fear that the West would introduce new sanctions against the banking sector of the Russian Federation, complicating access to external financial markets to the limit.”

Such a reaction is temporary and in this case is due to a high degree of uncertainty and anxiety in society. People are looking for any ways to protect their savings, sometimes acting impulsively and thoughtlessly. Apparently, Deev argues, as the geopolitical situation normalizes, this kind of thing will happen less and less. They are of the same nature as the queues in bank exchangers during the collapse of exchange rates or the rush for long-term storage products, as in March 2022. The situation practically does not threaten the Russian banking system, the analyst believes: it is quite stable and has liquidity reserves for a long period.

“Partial mobilization led to the fact that, having moved abroad, some Russians moved their foreign currency savings there as well,” notes Mark Goykhman, chief analyst at TeleTrade. – And some perceived what happened as a direct threat to their funds from the Russian banking system. There is another obvious factor: the “toxicity” of dollars and euros, which is expressed in high commissions for individual clients for keeping it on current accounts, as well as in the risks of sanctions blocking.”

Of course, Goikhman concludes, the outflow of currency from the country is not good for the economy. This narrows the possibilities for banks to finance foreign exchange transactions, in particular, imports. On the other hand, due to the reduction in imports, the demand of banks and companies for dollars and euros is also decreasing.

“The record September outflow of $6.7 billion is connected precisely with partial mobilization, an extraordinary event for Russia,” says Mikhail Belyaev, candidate of economic sciences, financial analyst. “It has introduced additional uncertainty and turbulence into the social atmosphere. People who left the country began to withdraw money abroad in any possible form – both in cash and non-cash. But it was just a one-time surge, and quite sharp and unpleasant. There will be no continuation, this is not a trend. As for the consequences for the economy and the stability of the financial system, they are insignificant, since the volume of household deposits in banks amounts to many trillions of rubles.”