Russia and Ukraine

Moscow’s revamped stock exchange has everything it takes to be a global player, with the exception of supply and demand. Has Russia’s isolation put a dampener on its ambitious domestic capital markets development programme?

The latest results of a systemic risk index reveal elevated risks in Russia, Portugal and France but a generally marked improvement across the rest of Europe.

Analysts support the Central Bank of Russia’s (CBR) response to the collapse of the rouble, arguing it will shift market expectations and could stabilize the currency in the medium-term. In an interview with Euromoney before the move, a CBR official discusses the opportunities and challenges in the regime shift.

While sanctions are hitting the Russian markets and pushing up interest rates, senior executives at Sberbank and potash producer Uralkali tell Euromoney the country’s banks and corporates are looking internally and to the east for new sources of financing. But with Russia sliding towards recession, liquidity is vanishing.

I was intrigued to see that Blackstone, the leading private equity firm, is disengaging from Russia.

Sector profitability holding up; central bank adds dollars to liquidity provision.

CEE enthusiasts should not despair just yet. A number of the clouds handing over the region might turn out, on closer inspection, to have a silver lining.

Incensed by their failure to reform, Brics policymakers have established a flawed rival to the World Bank and IMF. Rhetoric aside, the west dismisses emerging-market dissent over the broken financial architecture at its peril.

Philosopher, philanthropist and father of 23 – Roman Avdeev is a far cry from the stereotype of Russian oligarch. Yet his ownership of Credit Bank of Moscow, one of the country’s fastest-growing lenders, along with canny deal-making in sectors from retail to pharmaceuticals, is fast propelling him up the rich list. And his status as one of Russia’s most independent billionaires gives him a unique insight into the country’s current pariah status.

Russia’s consumer lenders are the modern face of Russian finance, and could prove resilient to the current crisis.

Sanctions overs the conflict in Ukraine have closed off western capital markets to some Russian companies, giving Asia an opportunity to take a greater role. But an easy ride in the east is not guaranteed.

The escalating conflict in Ukraine and sanctions placed on Russia by the EU and the US are pushing private Russian money into Asian wealth centres and encouraging the country’s corporates to seek new sources of funding in the region.