BANK OF RUSSIA ANNUAL REPORT FOR 2016 Moscow 2017 Approved by the Bank of Russia Board of Directors on 28 April 2017 © THE CENTRAL BANK OF THE RUSSIAN FEDERATION, 2017 12 Neglinnaya Street, Moscow 107016 Published by Business News Agency PRIME Printed by ‘Tipografiya ‘Vozrojdenie’ Number of copies – 350. Order No. 867 BANK OF RUSSIA ANNUAL REPORT 3 FOR 2016 CONTENTS I. THE STATE OF THE RUSSIAN FEDERATION ECONOMY ............................................................................15 Summary ............................................................................................................................................................16 I.1. The macroeconomic situation ......................................................................................................................18 I.1.1. External economic conditions .............................................................................................................18 I.1.2. Inflation and economic activity ...........................................................................................................21 I.1.3. Fiscal policy, government finance and domestic government debt ....................................................24 I.1.4. Balance of payments and external debt .............................................................................................25 I.2. The financial sector ......................................................................................................................................30 I.2.1. Monetary aggregates and financial and commodity market conditions .............................................30 I.2.2. Financial market participants ..............................................................................................................35 I.2.2.1. Financial institutions ..............................................................................................................35 I.2.2.2. Financial market infrastructure ..............................................................................................44 I.2.2.3. Other participants ..................................................................................................................47 II. THE BANK OF RUSSIA’S ACTIVITIES ............................................................................................................49 Summary ............................................................................................................................................................50 II.1. Ensuring price stability ................................................................................................................................53 II.1.1. Monetary policy objectives and key measures .................................................................................53 II.1.2. Monetary policy instruments ............................................................................................................55 II.2. Ensuring financial market resilience ...........................................................................................................59 II.2.1. Ensuring financial stability ................................................................................................................59 II.2.1.1. Monitoring of financial stability risks ...................................................................................59 II.2.1.2. Macroprudential regulation measures to ensure financial stability .....................................63 II.2.2. Access to the financial market .........................................................................................................64 II.2.2.1. Credit institutions ................................................................................................................64 II.2.2.2. Non-governmental pension funds ......................................................................................66 II.2.2.3. Insurance entities ...............................................................................................................67 II.2.2.4. Other participants ...............................................................................................................68 II.2.2.5. Financial instruments .........................................................................................................69 II.2.2.6. National payment system participants ................................................................................71 II.2.3. Regulation and supervision ..............................................................................................................72 II.2.3.1. Credit institutions ................................................................................................................72 II.2.3.2. Non-governmental pension funds ......................................................................................78 II.2.3.3. Insurance entities ...............................................................................................................79 II.2.3.4. Other participants ...............................................................................................................82 II.2.3.5. National payment system participants ................................................................................89 II.2.4. Financial rehabilitation of credit institutions ......................................................................................90 II.2.5. Liquidation and control over termination of financial institutions ......................................................93 II.2.6. Protecting the interests of bank depositors and persons insured in the compulsory pension insurance system ................................................................................................................95 II.2.7. Regulation, control, and supervision of corporate relations .............................................................96 II.2.8. Countering malpractice in the financial market ................................................................................99 II.2.9. Foreign exchange regulation and foreign exchange control ...........................................................101 BANK OF RUSSIA 4 ANNUAL REPORT FOR 2016 II.2.10. Countering the legalisation (laundering) of criminally obtained incomes and the financing of terrorism .........................................................................................................102 II.2.11. Management of reserve assets in foreign currency and gold .........................................................104 II.2.12. Improving the accounting and the accounting (financial) statements of financial institutions ........109 II.3. Expanding financial inclusion ....................................................................................................................110 II.3.1. Financial market development .......................................................................................................110 II.3.2. Protecting the rights of financial services consumers and expanding financial inclusion ...............114 II.3.3. Increasing financial literacy of the population .................................................................................115 II.3.4. Specialised refinancing facilities.....................................................................................................116 II.4. Technology development and innovation support in the financial market.................................................118 II.4.1. Development of financial technologies ...........................................................................................118 II.4.2. Development of information technology .........................................................................................119 II.4.3. Development of electronic interaction mechanisms .......................................................................120 II.4.4. Enhancing cyber resilience ............................................................................................................121 II.5. Development of the national payment system ..........................................................................................122 II.5.1. Cash circulation management ........................................................................................................122 II.5.2. Development of cashless payments and the national payment card system .................................124 II.5.3. Development of the Bank of Russia payment system ....................................................................125 II.5.4. Development of other payment systems ........................................................................................126 III. OTHER ACTIVITIES .......................................................................................................................................127 III.1. Information policy ....................................................................................................................................128 III.2. Economic research .................................................................................................................................130 III.3. Statistical activities ..................................................................................................................................133 III.4. International cooperation ........................................................................................................................135