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. Last Updated: 07/27/2016

Bank Loosens Reserves

MOSCOW () -- The Central Bank is working on a new regulation to cut commercial banks' reserve requirements and increase penalties for underpaid reserves, the bank said Thursday.

The Central Bank intends to cut the number of accounts covered by compulsory reserves, and to allow banks to cut the amount of monthly reserves. The regulation will become valid in the first half of 1996.

As of May 1, the Central Bank will increase fines for unpaid reserves to an amount equal to twice the level of the refinancing rate, currently 120 percent annual, on the unpaid amount.

At present, the maximum fine for nonpayment of reserves is only a nominal 100,000 rubles ($21). But banks that repeatedly opt to pay the fine and ignore reserve requirements can face a series of other sanctions.