Our progress / Hot Topics

Financial markets megaregulator

Back to Media

Central Bank to Grant FFMS “Head Department” Status

11.02.2013 14:03 / Vedomosti

When Federal Financial Markets Service merges with the Central Bank, it will acquire “Head Department” status, say officials. “The Service can have any internal status within the CB, government approval is not required”, says one source.

Open Government discussed a higher status for FFMS — Non-banking Oversight Committee of the Central Bank. A similar Banking Oversight Committee is presided by First Deputy Chairman of the Central Bank, lists heads of oversight departments and makes key decisions. The Central Bank website states that there are currently three Head Departments (real estate, capital expense audit and planning, data security and encryption). Besides, there is the Head Banking Inspection (managed by a Deputy Chairman of the Central Bank). Regional Central Bank divisions are also Head Departments.

A Head Department may also be formed from internal divisions, but their status will be inferior to CB Departments, resulting in lower future salaries for FFMS staff, claim officials. Salaries will be ‘radically’ higher than at FFMS, but lower than for similar banking oversight positions at the CB, says one source. According to CB stats for 2011, an average monthly salary was RUB 86568, with RUB 62302 at FFMS (Rosstat data). Those familiar with the situation at both organizations say that the gap is wider. CB Chairman Sergey Ignatiev posted a 2011 income of RUB 22.5mln, Head of FFMS Dmitry Pankin (in charge since April) posted RUB 7.7mln. Deputy Prime Minister Igor Shuvalov admitted that no state funds can be allocated for FFMS headcount expansion and hiring of top-tier professionals.

The status is not downgraded, the purpose of this is to avoid amending the CB Act in the initial stage, explains a source close to the debate. The Non-banking Oversight Committee concept is still valid, however, a structural body is preferable to collegiate, explains an informed official. “We have protocols of meetings with the President and the Prime Minister, with approved guidelines, I think we must use them”, said FFMS Head Dmitry Pankin. The CB was unavailable for comment.

Margarita Papchenkova, Olga Plotonova

Financial markets megaregulatorProject Group №1