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. Last Updated: 07/27/2016

Bank Troubles

The critical condition of two large Russian commercial banks -- Tveruniversalbank and Credobank -- is only the tip of the iceberg. The state of at least 30 other Russian banks is not much better.

Attempts to find the reason for this in the activity of the banks themselves proved unsuccessful. No one was able to reveal any serious crime. ... Maybe the closing of several credit lines to Western banks played a negative role, but this is not the only factor responsible for the present crisis.

According to Vyacheslav Zakharov, vice president of the Association of Russian Banks, the condition of Tveruniversalbank results from the poor state of the economy and the drop in industry, for which the banking system is no longer able to compensate. He also mentioned the Central Bank's excessively strict monetary policy.

Bankers admit to some of their own mistakes. They cite management problems and risky credit policies. But there is practically no serious factor that can be diminished with the waving of a magic wand -- with political will alone or promising to adhere to economic reform. Only painstaking labor will work, something that politicians should have started long ago.

The time has passed when these problems could have been solved with relatively no pain, as has Russia's chance to exit the economic crisis in 1996.