FOREIGN COUNTRIES OWE $69 BILLION TO RUSSIA
As of January 1, 2006, debt of foreign countries to Russia amounted almost to 2 trillion roubles ($68.968 billion). This figure was contained in the documents of the Finance Ministry published in the addendum to the draft budget for 2007.
The debt of Iraq amounts to $9.4 billion and the debt of Korea amounts to $4.4 billion. Other large debtors are Syria, China, Vietnam, India, Algeria and Albania.
Debts under commercial credits issued until the beginning of 1991 are represented by debts of companies and crediting organizations of other countries. For example, Iraqi, Sudanese and American companies owe more than $4.7 billion to Russia. Among the debtors there are also Korean and Cuban banks.
Among the CIS countries Ukraine owes the biggest sum. As of January 1, 2006, Ukraine owed $1.4 billion to Russia, Uzbekistan owed $670 million and Belarus owed $361 million. The overall debts of the CIS countries to Russia amount to $3.29 billion.
<ref>lenta.ru, August 29, 2006
EXPERTS OF ALFA-BANK EXPECT A BOOM ON THE MARKET OF MORTGAGE CREDITS
Analysts of Alfa-bank are convinced that boom on the Russian market of consumer crediting will end soon. It will be substituted by explosive growth of mortgage credits. In 18 months the volume of these credits will more than double to $7 billion and by 2008; it will reach $12 billion.
Analysts of Alfa-bank are convinced that the period of rapid growth of the market of consumer crediting is over. The analysts drew this conclusion after study of the crediting situation in neighboring countries. Analyst of Alfa-bank Natalia Orlova says that in the largest countries of Eastern Europe, debts under consumer credits approximately correspond to the level of average salaries in these countries. Orlova adds, “For example, given average salary of $520 a month in Hungary average debt amounts to $653, in Czech Republic and Poland having salaries of $703 and $601 credit debts amount to $631 and $577 respectively.” She added that in Russia in 2002, the average size of consumer debts was almost 85.72% less than the average salary. Now it lags behind it only by 12.7%. Given the average monthly salary of $300, the level of debt per capita amounts to $266. Orlova concludes that the market of consumer crediting is close to saturation.
The boom in consumer crediting will be replaced with a boom of mortgages. Orlova states, “The volumes of mortgage and consumer debts in the Czech Republic are almost equal ($631 per capita), in Hungary they amount to $931 against $653 and Poland they amount to $311 against $577.” “Along with this, in Russia mortgage debt per capita amounts only to $21 against $266 of consumer debt,” continues Orlova. She concludes that potential of the Russian mortgage market is obvious. According to Alfa-bank, by the beginning of 2006, banks issued mortgage credits for housing purchase totaling about $3 billion, which was less than 10% of the overall volume of mortgage credits. Orlova is convinced that by the end of 2007, the market will grow to $7 billion and by the end of 2008; it may amount to $12 billion. Analysts of Alfa-bank believe that this is not the limit either and the volume of mortgage credits may grow 1,900-3,900% in comparison to current figures.
Deputy CEO of Investsberbank Maxim Chernushchenko agrees that the market will not see a 100% growth in consumer crediting anymore. In any case, Chernushchenko is not abashed by this circumstance, “Portfolios of credits have already reached significant sizes and hence absolute figures will be solid.”
As to the prospects of the mortgage market, bankers and experts do not have a common opinion. Ilya Zibarev, head of the mortgage crediting block of Alfa-bank, is convinced that analysts of his bank are right. Deputy CEO of Absolut bank Oleg Skvortsov agrees with him. Zibarev remarks, “Whereas three years ago a mortgage credit was an incomprehensible product, now about 10-15% of deals on the housing market are already struck with use of mortgage credits in Moscow.” Skvortsov adds that banks are prepared to make terms of mortgage crediting more loyal for clients. He also says that it is necessary to bear in mind that these are the least risky credits for banks.
Maxim Matovnikov, General Director of Interfax economic analysis center, admits that mortgage crediting has a good growth potential. Matovnikov explains, “In the world mortgage constitutes a big share in the credit portfolio of banks and Russian banking market is developing in a way similar to the Western one.” Moreover, he adds that mortgage portfolio is growing faster than portfolio of mortgage credits on account of larger sums and longer crediting terms. At any rate, it is hardly possible to expect growth of the mortgage market by 1,900-3,900%. Matovnikov is convinced that for the volumes of mortgage credits to demonstrate twofold growth interest rates on credits should decrease significantly. According to Oleg Repchenko, head of the analytical center irn.ru, at present 5-10% of deals on the secondary housing market in Moscow are struck with assistance of mortgage credits and on the primary housing market this parameter is even higher and varies from 20% to 50%. According to Repchenko, in the next few years these market shares will not change significantly. Repchenko explains, “Real estate prices are growing, demand exceeds the supply and real estate sellers still prefer buyers who are not connected with mortgages.”
<ref>Vedomosti, September 01, 2006
