Central bank admits that competition in Russian banking sector low

SOCHI, Oct 18 (PRIME) -- Competition among Russian banks is not very strong, and the central bank’s purge of the sector from bad players is one of the reasons for that, the regulator’s Chairwoman Elvira Nabiullina said on Thursday during a forum.

“I do not completely agree with the opinion of (Sberbank CEO) German Oskarovich (Gref), who said that everything is good with competition in the banking sector. We have historical problems, and the central bank often hears fair criticism that improvement of the banking sector’s health led to a higher share of state banks, and we do have a large share of large banks,” she said.

But large players are the ones who are technological leaders and who drive the market forward.

“Still, we would very much like to create equal conditions for competition through joint actions with the regulator without creating obstacles for technological leaderships…So that all remote corners are reached, and so that inclusion of financial services reaches the levels that we are discussing now,” she said.

She also said that the so-called banking slavery still exists in Russia, as some people cannot choose a bank in which they would like to receive their salaries.

A man should be allowed to choose services and transfer money freely regardless of in which bank they have their account. “I think that we should think about that. And we would like to get a response form the market and understand what we should do as a regulator,” she said.

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