DOCSLIB.ORG

Development of Capital Markets and Institutional Investors in Russia Recent Achievements and Policy Challenges Ahead

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Development of Capital Markets and Institutional Investors in Russia Recent Achievements and Policy Challenges Ahead 37266 WORLD BANK WORKING PAPER NO. 87 Development of Capital Markets Public Disclosure Authorized and Institutional Investors in Russia Recent Achievements and Policy Challenges Ahead Michel Noel Zeynep Kantur Evgeny Krasnov Sue Rutledge Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized THE WORLD BANK WORLD BANK WORKING PAPER NO. 87 Development of Capital Markets and Institutional Investors in Russia Recent Achievements and Policy Challenges Ahead Michel Noel Zeynep Kantur Evgeny Krasnov Sue Rutledge THE WORLD BANK Washington, D.C. Copyright © 2006 The International Bank for Reconstruction and Development/The World Bank 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. All rights reserved Manufactured in the United States of America First Printing: August 2006 printed on recycled paper 1 2 3 4 5 09 08 07 06 World Bank Working Papers are published to communicate the results of the Bank’s work to the development community with the least possible delay. The manuscript of this paper therefore has not been prepared in accordance with the procedures appropriate to formally-edited texts. Some sources cited in this paper may be informal documents that are not readily available. The findings, interpretations, and conclusions expressed herein are those of the author(s) and do not necessarily reflect the views of the International Bank for Reconstruction and Development/The World Bank and its affiliated organizations, or those of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank of the legal status of any territory or the endorsement or acceptance of such boundaries. The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The International Bank for Reconstruction and Development/The World Bank encourages dissemination of its work and will normally grant permission promptly to reproduce portions of the work. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, USA, Tel: 978-750-8400, Fax: 978-750-4470, www.copyright.com. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA, Fax: 202-522-2422, email: [email protected]. ISBN-10: 0-8213-6794-3 ISBN-13: 978-0-8213-6794-0 eISBN: 0-8213-6795-1 ISSN: 1726-5878 DOI: 10.1596/978-0-8213-6794-0 Michel Noel is Lead Financial Specialist in the Private & Financial Sectors Development Sector unit of Europe and Central Asia Region of the World Bank. Zeynep Kantur is Financial Sector Specialist in the Financial Sector Operations & Policy Department of the World Bank. Evgeny Krasnov is Financial Analyst in the Moscow office of the World Bank. Sue Rutledge is Senior Private Sector Development Specialist in the Private & Financial Sectors Development Sector unit of Europe and Central Asia Region of the World Bank. Library of Congress Cataloging-in-Publication Data Development of capital markets and institutional investors in Russia : recent achievements and policy challenges ahead/Michel Noel ...[et al.]. p. cm.—(World Bank working paper ; no. 87) Includes bibliographical references and index. ISBN-13: 978-0-8213-6794-0 (alk. paper) ISBN-10: 0-8213-6794-3 (alk. paper) ISBN-10: 0-8213-6795-1 (electronic : alk. paper) 1. Capital market—Russia (Federation) 2. Finance–Russia (Federation) 3. Russia (Federation)—Economic Policy. I. Noel, Michel, 1954–HG5580.2.A3D49 2006 332¢.04150947—dc22 2006020560 Contents Acknowledgments vii Abbreviations ix Executive Summary xi 1. Capital Markets and Institutional Investors: Recent Evolution 1 2. Securities Markets: Key Impediments for Further Development and Policy Challenges Ahead 7 Legal and Regulatory Framework 7 Market Infrastructure 9 Government Bonds 10 Sub-Sovereign Bonds 12 Corporate Bonds 13 Equities 14 3. Institutional Investors: Key Impediments for Further Development and Policy Challenges Ahead 15 Mutual Funds 15 Pension Funds 16 Insurance Companies 17 Technical Annexes 21 A. Recent Macroeconomic and Financial Sector Developments 23 Macroeconomic Environment 23 Banking Sector 28 Capital Markets and Non-Bank Financial Institutions 30 B. Legal and Regulatory Framework for Securities Markets 33 Recent Evolution 33 Key Impediments and Priorities Going Forward 36 C. Market Infrastructure 39 Recent Evolution 39 Key Impediments to Development 48 Key Priorities Going Forward 49 iii iv Contents D. Government Bond Market 51 Recent Evolution 51 Key Impediments to Development 56 Key Priorities Going Forward 59 E. Sub-Sovereign Bond Market 61 Recent Evolution 61 Key Impediments to Development 67 Key Priorities Going Forward 69 F. Corporate Bond Market 71 Recent Evolution 71 Key Impediments to Development 78 Key Priorities Going Forward 79 G. Equity Markets 81 Recent Evolution 81 Key Impediments to Development 85 Key Priorities Going Forward 86 H. Mutual Funds 87 Recent Evolution 87 Key Impediments to Development 93 Key Recommendations Going Forward 94 I. Pension Funds 95 Recent Evolution 95 Key Impediments to the Future Development of NSPFs 104 Key Priorities Going Forward 106 J. Insurance Companies 107 Recent Evolution 107 Key Impediments to the Development of the Insurance Sector 109 Key Priorities Going Forward 116 K. The Capital Market Development Project1 119 Project Background 119 Bibliography 131 Contents v LIST OF TABLES 1. Key Macroeconomic Indicators 24 2. Banking Statistics 28 3. Capital Market (Supply side) 31 4. Capital Market (Demand side) 32 5. Markets for Russian Securities 40 6. MICEX Turnover 45 7. Registrars and Depositories 1996–2004 47 8. Professional Market Participants 48 9. Government Bonds Outstanding, Billions of Rubles 52 10. Market Structure as of End November, 2005 63 11. Regional Bond Issues in December 2005 64 12. Domestic IPOs 84 13. Concentration of Assets—Top Five Asset Management Companies 92 14. Investment Funds Investors 92 15. Pension Replacement Rates and Other Indicators 1990–2000 (percent) 96 16. The Reform of the Unified Social Tax (US$) and Its Influence on the Pension Reform 99 17. Funded Part of Pillar II (billions of rubles) 101 18. Investment Rules for Funded Portion of Pillar 2, Managed by Private Sector 101 19. NSPF Sector (Pillar III Funds) 104 20. Insurance Sector Profitability—Crude Loss Ratio, Percent 109 21. Technical Advisors Activities and Contribution to Policy Agenda (2004–05 Results) 125 LIST OF FIGURES 1. M2/GDP Dynamics 26 2. Eurobonds Spreads to UST, bp 26 3. OFZ Effective Yield, percent 27 4. Official Rub/US$ Exchange Rate 2001–06 27 5. OFZ Yields Dynamics 54 6. JP Morgan EMBI+ Russia Spread, bp (2002–05) 55 7. Subnational Bonds Outstanding, (nominal value as of End November 2005, billions of rubles) 62 8. Sub-sovereign Market Structure by Size, as of End November 2005 63 9. Primary Market 64 vi Contents 10. Turnover 2002–05 65 11. Sub-Sovereign Bond Yields 2002–05 6 6 12. Corporate Bonds Market Dynamics 72 13. Corproate Bonds Turnover 74 14. Corporate Bonds, Types of Issuers 74 15. Investor Base (percentages) 75 16. Investor Base as of 2005 75 17. Corporate Bond Average Annualized Yields 2002–05 77 18. Corporate Yields Dynamics 77 20. Evolution of the Russian Equity Market (1996–2005) 82 19. Corporate Bonds Outstanding 82 21. Weighted Average Free Float for Emerging Market Equities 83 22. Russian Equities Turnover 2003–04 84 23. RTS Index Performance 85 24. Investment Funds Growth 88 25. Investment Funds Net Asset Value (billions of rubles) 89 26. Net Asset Value of Funds by Assets Types, end of 2005 90 27. Number of funds, end of 2005 9 1 LIST OF BOXES 1. Pre-reform Pension System in Russia. 9 6 2. Overview of the Russian Pension System, Starting from January 1, 2005 9 8 Acknowledgments his Report was prepared by a Task Team led by Michel Noel (Lead Financial Spe- Tcialist, ECSPF), Zeynep Kantur (Financial Sector Specialist, OPD), Evgeny Krasnov (Financial Analyst, ECSPF—Moscow Office) and Sue Rutledge (Senior Private Sector Development Specialist, ECSPF). The Task Team consisted of Rupa Bhattasali (Consul- tant, ECSPF), Steen Byskov (Consultant, ECSPF), Pasquale di Benedetta (Consultant, ECSPF), Yumi Ejiri (Consultant, ECSPF), and Dan Goldblum (Financial Sector Specialist, OPD). The Team extends special thanks to Kristalina Georgieva (Country Director, ECCU1), Fernando Montes-Negret (Director, ECSPF), Tunc Uyanik (Sector Manager, ECSPF) and Yasuo Izumi (Program Manager, PA9SS) for their guidance and support in the prepara- tion of the Report. The Team is grateful to Paula Perttunen (Lead Financial Specialist, ECSPF) for agreeing to be Team Advisor and for her very useful comments on an earlier version of the Report. The Team is grateful to Claire Grose (Senior Financial Specialist, OPD),Yibin Mu (Financial Economist, OPD) and Alexander Morozov (Senior Economist, ECSPE—Moscow Office) for agreeing to be Peer Reviewers for the Report. The Team is thankful to Claire Grose, Alexander Morozov, Luigi Passamonti (Senior Advisor, OPD), and Dmitri Vittas (Senior Advisor, OPD), for their very useful comments on an early version of the Report. The Team is also grateful to Sylvie Bossoutrot (Senior Operations Officer, ECSPF) for her invaluable collaboration in the framework the Russia Capital Market Development Project. Alberto Monti, Tyge Rasmussen, Lorenzo Savorelli, and Paul Sullivan (Consultants, ECSPF) all provided invaluable inputs to the Report. The field visits took place in November 2003 and April–May 2004. The updates of the finding of the mission were done by Moscow based consultants at the end of 2004 and end of 2005.
Load more

Recommended publications
  • Study on the Potential of Green Bond Finance for Resource-Efficient Investments
    Study on the potential of green bond finance for resource-efficient investments Europe Direct is a service to help you find answers to your questions about the European Union. Freephone number (*): 00 800 6 7 8 9 10 11 (*) The information given is free, as are most calls (though some operators, phone boxes or hotels may charge you). LEGAL NOTICE This document has been prepared for the European Commission however, it reflects the views only of the authors, and the Commission cannot be held responsible for any use which may be made of the information contained therein. More information on the European Union is available on the Internet (http://www.europa.eu). Luxembourg: Publications Office of the European Union, 2016 ISBN 978-92 -79-63802-2 doi:10.2779/234777 © European Union, November 2016 EUROPEAN COMMISSION Directorate-General for ENVIRONMENT Directorate ENV.A — Policy Unit ENV.A.2— Green Finance & Economic Analysis European Commission B-1049 Brussels Study on the potential of green bond finance for resource-efficient investments Authors: Annica Cochu, Carsten Glenting, Dominic Hogg, Ivo Georgiev, Julija Skolina, Frederik Eisinger, Malene Jespersen, Rainer Agster, Steven Fawkes, Tanzir Chowdhury 3 TABLE OF CONTENTS ABSTRACT ................................................................................................................... 7 EXECUTIVE SUMMARY ................................................................................................... 8 ABBREVIATIONS .........................................................................................................
    [Show full text]
  • Inside China Inc China Development Bank's Cross Border Energy Deals
    Inside China, Inc: China Development Bank’s Cross-Border Energy Deals Erica Downs Inside China, Inc: China Development Bank’s Cross-Border Energy Deals Erica Downs John L. Thornton China Center Monograph Series • Number 3 • March 2011 The John L. Thornton China Center at Brookings About Brookings The Brookings Institution is a private non-profit organization. Its mission is to conduct high-quality, independent research and, based on that research, to provide innovative, practical recommendations for policymakers and the public. The conclusions and recommendations of any Brookings publication are solely those of its author, and do not reflect the views of the Institution, its management, or its other scholars. Copyright © 2011 1775 Massachusetts Avenue, N.W., Washington, D.C. 20036 www.brookings.edu acknowLedGements I thank the following individuals who read and commented on drafts of this manuscript: Mauricio Cardenas Andrew Kennedy Kevin Casas-Zamora Bo Kong Kevin Foley Arthur Kroeber Kevin Gallagher Kenneth Lieberthal Stephen Green Barry Naughton Yuxin He Lisa Viscidi Mikkal Herberg I thank Iris An, Diana Caicedo, Henry Fung and Robert O’Brien for research assistance and all of the individuals I in- terviewed in China and the United States for generously shar- ing their views with me. I also want to express my sincere appreciation to John L. Thornton and the ACE Charitable Foundation, whose gener- ous support of the John L. Thornton China Center, along with a gift from the Carnegie Corporation of New York, helped make this publication possible. Brookings recognizes that the value it provides to any supporter is in its absolute commitment to quality, independence and im- pact.
    [Show full text]
  • World Economic Situation and Prospects 2014
    World Economic Situation and Prospects 2014 United Nations United Nations World Economic Situation and Prospects 2014 asdf United Nations New York, 2014 The report is a joint product of the United Nations Department of Economic and Social Affairs (UN/DESA), the United Nations Conference on Trade and Development (UNCTAD) and the five United Nations regional commissions (Economic Commission for Africa (ECA), Economic Commission for Europe (ECE), Economic Commission for Latin America and the Caribbean (ECLAC), Economic and Social Commission for Asia and the Pacific (ESCAP) and Economic and Social Commission for Western Asia (ESCWA). For further information, see http://www.un.org/en/development/desa/policy/wesp/index.shtml or contact: DESA ECLAC MR. WU HONGBO, Under-Secretary-General MS. ALICIA BÁRCENA, Executive Secretary Department of Economic and Social Affairs Economic Commission for Latin America Room S-2922 and the Caribbean United Nations Av. Dag Hammarskjöld 3477 New York, NY 10017 Vitacura USA Santiago de Chile ☎ +1-212-9635958 Chile [email protected] ☎ +56-2-22102000 [email protected] UNCTAD DR. MUKHISA KITUYI, Secretary-General ESCAP United Nations Conference on Trade MS. NOELEEN HEYZER, Executive Secretary and Development Economic and Social Commission for Asia Room E-9042 and the Pacific Palais de Nations, 8-14 United Nations Building Av. de la Paix, 1211 Rajadamnern Nok Avenue Geneva 10 Bangkok 10200 Switzerland Thailand ☎ +41-22-9171234 ☎ +66-2-2881234 [email protected] [email protected] ECA ESCWA DR. CARLOS LOPES, Executive Secretary MS. RIMA KHALAF, Executive Secretary United Nations Economic Commission for Africa Economic and Social Commission for Western Asia Menelik II Avenue P.O.
    [Show full text]
  • Responsibility Trust Innovation
    Responsibility Trust Innovation Annual Report | 2020 THE PRESENT REPORT WAS APPROVED BY THE GENERAL MEETING OF SHAREHOLDERS OF THE MOSCOW EXCHANGE ON APRIL 28, 2021 (MINUTES NO 62) Annual Report 2020 Table of Contents Moscow Exchange in brief 3 Corporate governance 59 Business model 4 Corporate governance system 60 Statement from the Chairman Risk management 91 of the Supervisory Board 5 Information for investors 98 Statement from the Chief Executive Officer 7 Appendices 104 Strategic report 9 Information on major transactions Main trends in the development and interested-party transactions 105 of the sector 10 Key performance indicators 106 Mission and corporate values 15 Organisational chart of Moscow Exchange 107 Priority areas of Moscow Exchange 16 Supply chain management 108 Key projects in 2020 17 Report on Moscow Exchange Compliance with the Principles and Recommendations of the Corporate Governance Code 109 Report on the Adherence to the Moscow Performance review 19 Exchange Corporate Governance Code 141 Contacts 150 Financial results review 20 Consolidated Financial Statements 151 Market performance 24 Post-trade services 36 Information products 39 Client services 42 Information Technologies 43 Growth outlook for 2021 45 Compliance 49 Human resources 50 Moscow Exchange and the community 53 Environmental impact 57 Moscow Exchange in brief Moscow Exchange Group manages Russia’s main trading platform for equities, bonds, derivatives, currencies, money market instruments and commodities. The Group is comprised of: ► PJSC Moscow Exchange MICEX-RTS, which operates the Equity & Bond Market, Money Market, Derivatives Market as well as FX Market and Precious Metals Market; ► NCO CJSC National Settlement Depository (NSD), the central securities depository; ► JSC Non-Banking Credit Institution – Central Counterparty National Clearing Center (CCP NCC, or NCC); ► JSC National Mercantile Exchange (NAMEX), which operates the Commodities Market; ► MOEX Innovations, which develops innovative technologies and works with fintech start-ups.
    [Show full text]
  • 2020 Martina
    Bangor University DOCTOR OF PHILOSOPHY Credit rating divergence and the role of opacity in emerging market banks Martin Merizalde, Andrea Award date: 2020 Awarding institution: Bangor University Link to publication General rights Copyright and moral rights for the publications made accessible in the public portal are retained by the authors and/or other copyright owners and it is a condition of accessing publications that users recognise and abide by the legal requirements associated with these rights. • Users may download and print one copy of any publication from the public portal for the purpose of private study or research. • You may not further distribute the material or use it for any profit-making activity or commercial gain • You may freely distribute the URL identifying the publication in the public portal ? Take down policy If you believe that this document breaches copyright please contact us providing details, and we will remove access to the work immediately and investigate your claim. Download date: 11. Oct. 2021 Credit rating divergence and the role of opacity in emerging market banks By Andrea Martin Merizalde PhD thesis Bangor Business School April 2020 Declaration and consent I hereby declare that this thesis is the results of my own investigations, except where otherwise stated. All other sources are acknowledged by bibliographic references. This work has not previously been accepted in substance for any degree and is not being concurrently submitted in candidature for any degree unless, as agreed by the University, for approved dual awards. Yr wyf drwy hyn yn datgan mai canlyniad fy ymchwil fy hun yw’r thesis hwn, ac eithrio lle nodir yn wahanol.
    [Show full text]