SOCHI, August 9 (Itar-Tass) —— Russian banks are now better prepared to resist crisis phenomena in the world economy than they were two years ago, VTB head Andrei Kostin told Prime Minister Vladimir Putin on Tuesday.
“We are prepared much better today than we were two years ago. I do not anticipate any problems for VTB and the Russian banking sector at large even if the situation becomes less favorable than we expect,” he said.
“We can handle current economic problems,” Kostin concluded.
A balanced macroeconomic policy is a cure for the crisis, Putin told a press conference earlier in the day.
“Self-alarming should be constant to prevent the worst. This is not a joke; the stock market is a very sensitive thing,” he said. “There is also a need for a balanced macroeconomic policy.”
Putin said that liquidity would be added to currency markets if necessary. “The Finance Ministry and the Central Bank are monitoring the market status and will add liquidity if necessary,” he said.
The Russian state debts is only 10% GDP, and only 3% of that amount are foreign debts, Putin said. The country’s gold and foreign currency reserves near $550 billion. The federal budget deficit may be smaller than 1% GDP this year.
In turn, Finnish Prime Minister Jyrki Katainen, the other speaker at the press conference, said it was hard to predict the consequences of the current turbulence. He said the situation was rather nervous due to the mistrust in certain countries and their ability to handle their debts.
The abrupt fall of stock markets is fraught with two risks, Katainen said. First, stock markets may be frozen and thus cause problems for companies. Secondly, there may be a long period of slow growth of stock markets, he said. The premier called for a very clear and strict economic policy.