Mandatory reserve requirements of the Bank of Russia: characteristics and mechanism of action

Cover Page

Abstract


The article focuses on the description of one of the basic tools of the monetary credit policy conducted by countries, the compulsory reserve requirements, which represent the tool of monetary policy which is used in many countries of the world, the mechanism of formulating such requirements by central banks, the degree of their influence on the liquidity of banks and the growth of cash volumes. Functions of the reserve requirements deposited on bank accounts of Russia are considered in depth. The article deals with dynamics of standard rates of required reserves; the «classical» scheme of averaging of required reserves is analyzed. Authors unitize the reserved liabilities of the credit organizations in three categories: liabilities of the credit organization to legal nonresident persons which consist of liabilities to legal nonresident persons (including liabilities to nonresident banks), liabilities to individual nonresident entrepreneurs, arising according to agreements of the bank (correspondent) account, contracts for attraction of money (credit, deposit and other agreements); liabilities of the credit organization to physical persons which consist of liabilities to physical persons (residents and nonresidents), arising according to bank deposit agreements (including certificated by savings certificates), the bank account; other liabilities of the credit organization in currency of the Russian Federation and (or) in foreign currency. An example of calculation of data for accomplishment of an obligation by the credit organization for averaging of required reserves is provided. The article also deals with the practical issues of the mechanism of action of this instrument of monetary policy, the order of reserve calculation, the Central Bank of Russia’s management of the obligatory reserves as well as assesses the legal base regulating various aspects of credit institutions’ fulfillment of the reserve requirements.

E E Frolova

Peoples’ Friendship University of Russia

Email: frolevgevg@mail.ru
The Department of Administrative and Financial Law Law Institute

E V Karmadonova

Baikal State University of Economics and Law

Email: frolevgevg@mail.ru

A B Zelentsov

Peoples’ Friendship University of Russia

Email: zelentsov51@mail.ru
The Department of Administrative and Financial Law Law Institute

Views

Abstract - 124

PDF (Russian) - 99

Refbacks

  • There are currently no refbacks.

Copyright (c) 2016 Legal Science