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. Last Updated: 07/27/2016

New $100 Bills See 'Modest Demand'

Senior Russian and U.S. officials congratulated each other Wednesday on the so-far, so-smooth introduction of the new U.S. $100 bill as the notes became available at downtown Moscow banks and exchange points.


"The situation connected with the introduction of the new banknotes ... remains calm," Central Bank chairman Sergei Dubinin told a news conference, citing reports from the Central Bank's 82 main regional directorates.


Dubinin and U.S. Ambassador Thomas Pickering, seated beneath an oversize cardboard model of the anti-counterfeit $100 bill, expressed relief with the Russian launch of the series.


"This is in my view a sterling example of how we two can cooperate to meet difficult situations," Pickering said.


The U.S. government has mounted a $1 million public relations campaign to reassure Russians the old bills will remain legal tender, and has worked extensively with the Russian Central Bank and commercial institutions to prepare for the launch.


According to Pickering, there has only been "a modest demand for the new currency" since the first bills arrived in Moscow on Monday evening, a fact borne out by visits to several exchange pointsaround the city Wednesday.


A cashier at Kredit-Moskva Bank on Tverskaya Ulitsa near the Kremlin said the bank received the bills Wednesday morning, but as of noon there had been only a few inquiries. The exchange point was empty.


The inflow of new dollars over the last days has been two to three times more than normal, but less than expected initially, Pickering said.


"The system is very responsive," he said. "Orders [made] in the early evening Moscow time can be delivered by noon the next day into the commercial banking system."


This week's introduction of the new U.S. note has triggered none of the concern linked to earlier changes in U.S. currency and Russian currency reforms.


In 1990, following the introduction of special security strips on $100 bills, then U.S. Ambassador Jack Matlock had to go on Soviet television to quell fears the old bills would no longer be legal tender.


"I would much rather appear in five press conferences than have to go on Russian television to explain ... after the fact why something went wrong," Pickering said.


Indeed, old $100 bills are likely to be around for a long while, as Russians hold an estimated $15 to $20 billion in U.S. cash, most of it in $100 bills.


When a Russian bank accumulates old bills it has the option of shipping them back to the New York Federal Reserve Bank, which will then shred them, said William Murden, the U.S. Treasury Attache in Moscow.


However, banks may also decide to sell the bills to other banks or pay them out to clients, as old bills remain legal tender indefinitely.