MOSCOW: Russia's central bank said on Wednesday it would help major Russian companies refinance foreign loans by starting lending money in hard currencies to those who are willing to put their foreign loans as collateral with the regulator.
While Russia has minimal sovereign foreign debts, Russian state and private companies and banks have accumulated a total of $600 billion in foreign debts of which around $100 billion are due next year.
The ability to repay the money was severely reduced this year by Western sanctions imposed on Russia which effectively shut access by companies and banks to European and Western debt markets.
A plunge in oil prices and a subsequent steep devaluation of the rouble have also undermined the financial strength of many Russian borrowers.
Russia has around $414 billion in foreign exchange and gold reserves, down from around $510 billion at the start of the year, as it was forced to spend heavily to prop the rouble in the past months after oil prices almost halved from this year's peaks in June.
"The measure is aimed... at helping to refinance foreign credits by Russian exporters in foreign currencies maturing in the near future at a time of their restricted abilities to access international capital markets," the central bank said in a statement.
It said such lending operations will also help bring the rouble exchange rate closer to fundamentals and reduce volatility. Loans are to be provided for up to one year at auctions at a minimal rate of Libor plus 0.75 percent.
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