Otkritie, Gaidar Institute Launch Russian Index

Dec 19 2011 | 12:13pm ET

Russia's Otkritie Financial Corporation has teamed up with the non-profit Gaidar Institute for Economic Policy to launch the Russian Financial Stability Index.

The index is intended to shine a light on how Russia’s financial system is faring “in the face of Europe’s sovereign debt crisis and prepare for possible market disruptions.”
The FSI is a composite index that includes dynamics of monetary indicators (monetary aggregate M2, the money multiplier, core CPI, the amount of bank deposits with the RF CB and BBR with commercial banks), interest rates (the rates in the interbank market, mid- and long-term rates in the GKO-OFZ market), balance of payments indicators and foreign exchange markets (international reserves of the Central Bank of Russia, the ratio of monetary aggregate M2 to international reserves, real ruble exchange rate against the U.S. dollar) and stock markets indicators (the RTS index, MICEX index of corporate bonds, government bonds index RGBI).

Said Vladimir Tikhomirov, Otkritie chief economist, in a statement:
“We back-tested the index to 1998 and it works well. Between August and October this year, only one of the 15 indicators of the FSI signalled rising instability in Russia’s financial system. This indicator represents the sum of deposits of commercial banks with the Central Bank of Russia (CBR) and CBR bonds held by credit institutions, which tumbled by 45%.
“The FSI suggests that the above mentioned trends only slightly increased the likelihood of financial instability in Russia from November and our index barely moved—remaining at 0.2 compared with 2.8 during the 2008 crisis.”
Otkritie, founded in 1995, focuses on investment banking, commercial banking, brokerage services and asset management. The group has more than 240 offices in 58 cities spanning the whole of Russia.

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