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Central Bank KPIs Set

17.10.2013 20:11 / vedomosti.ru

Having assumed the role of megaregulator, the Central Bank of Russia turns to market participants for advise on its own KPIs. Today, First Deputy Chairman of the Central Bank Sergey Shvetsov will hear answers at the MIFC Taskforce Strategic Session.

Vedomosti has seen most of the presentations, from 8 out of 10 workgroups. KPIs are rated on a scale of 3 to10 points.

National Stock Market Participants Association has assigned KPIs for three years. One of these is an annual 10% growth in retail investors and their assets gaining RUB 10bn a year in value, with the share of pension money in the stock market expanding by RUB 70bn, exchange volumes and issuers growing 10% per annum.

Cbonds General Director Sergey Lyalin will propose developing the ETF and other investment funds market. The Central Bank effort is expected to increase the number of investment fund shareholders by 20-25% per annum and boost the funds’ NAV by 25-30%.

Issuers have assigned the highest KPI value to the removal of the break-even condition from pension investment law, and entitling future pensioners to an annual switch of their non-state pension fund of choice, according to the presentation by Head of Primary Markets at Moscow Exchange Anna Vasilenko. Other proposals include lifting restrictions on synchronized IPOs of foreign securities in Russia and abroad.

The All-Russia Insurers Union President Igor Yurgens proposes to rate CB/FMS efforts by the volume of SRO powers and counter-scheming powers given to the market, asset quality reform and establishing a successful prudential system to identify companies with financial problems, implementing a special bankruptcy and bailout procedure, minimizing losses for insurers’ clients and lenders.

Mandatory qualification exams for microfinance company heads, industry standards for reporting and contracts (to simplify portfolio analysis during refinancing and securitization) — these are the KPIs proposed by Russian Microfinance Center President Mikhail Mamuta.

Mamuta’s proposals partly echo customer protection ideas in the presentation by Regional Banks of Russia Association Vice-President Oleg Ivanov, who puts added emphasis on unified standards for loan valuation prior to entering a microloan agreement, and introduction of a ‘cool-off period’ for the insurance and financial services customer to refuse the product.

National Non-state Pension Funds Association Chairman Konstantin Ugryumov, on behalf of the Non-state Pension Funds Workgroup, calls for transparent requirements, exhaustive and complete laws and regulations. Some of his proposals are quarterly and annually published results of non-state pension funds audit, with a highlight of standard notes and recommendations. He also proposes to assess legal compliance in taking corrective action towards market participants, the share of regulatory directives revoked in court, and the percentage of non-state pension funds and fund managers with risk management procedures in place.

The Central Bank and Financial Markets Service declined to comment on workgroup proposals or pass opinions prior to the event.

Yuri Nehaychuk

Financial markets megaregulatorProject Group №1