Treasury to place budget funds at floating rate repos from May

MOSCOW, Mar 21 (PRIME) -- Russia’s Federal Treasury will place spare budget money under repo agreements at floating market rates from May 2018, head of the authority Roman Artyukhin told reporters on Wednesday.

“Repo at a floating market rate, we plan to make these transactions some time starting from May,” Artyukhin said, adding that placement tenors of seven, 10 and 30 days are planned.

“Last year we created a floating rate deposit. But the problem is that a small number of participants have access to these instruments, while repo is a more inclusive instrument and if there is a floating market rate, we think the placement volume will be higher,” Artyukhin said.

He said that the treasury wants the central bank to ease its control over its market tools. “The amount of placement, the terms, the rates on all our instruments are in fact recommended by the central bank. We will ask the central bank to revise its approach to market instruments and to use them at floating rates.”

He said that the treasury plans to abolish capital requirements for banks, which want to participate in the deposit auctions but will make stricter rating requirements.

The treasury will start to place money of the social security fund in January 2019 and will send 15% of revenue to the budget, Artyukhin said.

Deputy Director of the authority Stanislav Prokofyev said that the treasury plans 2018 revenue from the operations at 80 billion rubles.

(57.7033 rubles – U.S. $1)

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