Russia Records 2nd-Highest Quarterly Capital Outflow

Russia's net capital outflow was the second-highest in the country's history in the third quarter because of the global financial crisis and the country's war with Georgia.

The total was $16.7 billion, compared with a net inflow of $40.7 billion in the previous three-month period, the Central Bank said in a statement on its web site Friday, citing preliminary calculations. In the first quarter, Russia posted a record net outflow of $23.2 billion.

Investors took money out of Russia after a five-day war with Georgia in August, a drop in commodities prices and the seizure of global capital markets, which spread after the bankruptcy of Lehman Brothers.

The banking industry accounted for $15.9 billion, or 95 percent of third-quarter outflow, the Central Bank said. The government has pledged more than $150 billion in loans, tax cuts, delayed tax payments and other measures to support lenders and companies amid the liquidity shortage.

For the first nine months, net capital was $800 million, according to the statement. The Central Bank hasn't revised its forecast for a net inflow of between $30 billion and $40 billion for the full year. Prime Minister Vladimir Putin said on Sept. 19 that the government and the Central Bank have "sufficient reserves to protect Russia's currency and the financial system."

The Central Bank sold about $20.6 billion of foreign currency reserves in the last four weeks to prop up the ruble, according to estimates by Rosbank. Russia's international reserves totaled $562.8 billion in the week to Sept. 26.

The ruble has lost 0.5 percent versus the Central Bank's dollar-euro basket last week, the most since the five days through Sept. 5, as falling prices and the squeeze in global credit markets hurt demand for emerging-market assets. The ruble weakened 3.6 percent against the dollar last week.