Russia and Ukraine

Elvira Nabiullina, governor of the Central Bank of Russia, has been named Euromoney’s Central Bank Governor of the Year for 2015.

More secondary listings likely; consumer, tech, export stocks in focus.

Two successful IPOs should have been good news for the country’s markets – if anyone had bothered to tell the world more about them.

Banks are prepared to sit through a couple of lean years in emerging Europe’s largest market, given that it will bounce back eventually. They might not want to get too optimistic though.

Raiffeisen insiders insist the bank’s current woes stem from circumstances beyond its control. Outsiders say the business is now paying for the sins of the past. A new leadership is desperately trying to reposition a bank whose most important markets are in turmoil, and whose ownership structure leaves it with unique capital challenges. CEO Karl Sevelda has a mountain to climb.

The rouble’s crash sent currencies tumbling across the Caucasus and Central Asia. Banks look relatively well placed to withstand an inevitable downturn. But with protracted stagnation looming, is it time for policymakers to build bridges further afield?

Emerging markets (EMs) with fiscal and external imbalances, vulnerable to capital outflows – including oil and other commodity producers struggling to balance their budgets – are among the 72 sovereigns downgraded since the end of 2014 by more than 440 economists and other country-risk experts.

Belarus’s leaders are promising a dramatic package of reforms that could overhaul the country’s sclerotic command economy and reduce its dependence on Russia. The only trouble is, no one believes them. Mixed messages to the bond markets haven’t helped.

Russia has been caught in the eye of a perfect storm. Battered by falling oil prices, US and EU sanctions and a dramatic market correction as the rouble was allowed to float, the currency has been in free-fall and liquidity has largely evaporated, with many brokers ceasing rouble trading altogether.

As Europe has stagnated since the financial crisis, Russia proved an invaluable source of returns for a handful of lucky western banking groups. But with Putin on the offensive, the rouble on the slide and recession on the horizon, its days as an engine of regional growth look to be over.

The growing likelihood of an economic crisis in Russia will have a major impact on global markets in 2015.

Rouble brews trouble for Russia