Russia bails out bank following ruble slide
Source: AP-Excite
By NATALIYA VASILYEVA
MOSCOW (AP) — Russia has bailed out a mid-sized bank for about $500 million to save it from bankruptcy— a clear sign that the slide in the value of the ruble in the wake of sliding oil prices is straining the banking system.
The Central Bank said Monday it will give Trust Bank 30 billion rubles that will allow it to continue operating as normal.
It will also place Trust Bank under its own supervision until it finds an investor. Major Russian banks said they had no interest in acquiring Trust, a top 30 Russian bank with about $5 billion in assets.
The problems afflicting Trust Bank follow a tumultuous period for the ruble, which is one of the worst-performing currencies this year, along with the Ukrainian hryvnia. A respected former Russian finance minister warned that the country is headed for "a full-blown economic crisis."
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Alexei Kudrin arrives for a news conference in Moscow, Russia, Monday, Dec. 22, 2014. Alexei Kudrin, Russia{2019}s finance minister in 2000-2011, has predicted a major economic crisis in Russia next year even if the prices on oil, the backbone of the Russian economy, go up. (AP Photo/Pavel Golovkin)
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(Reuters) - China is willing to help Russia if needed but believes that the country has the ability to overcome its current economic problems, Chinese Foreign Minister Wang Yi was quoted as saying in a state newspaper on Monday.
The ruble has dropped about 45 percent against the dollar this year, suffering particularly steep falls early last week. President Vladimir Putin has declined to call it a crisis and said the currency would eventually rise again.
Wang, speaking to reporters over the weekend, said that Russia also had the "wisdom" to get out of difficulties, the official China Daily reported.
"If the Russian side needs, we will provide necessary assistance within our capacity," he said, noting that the two countries had consistently helped each other.
He did not elaborate.
China's trade minister, also speaking at the weekend, proposed more use of China's currency in settling trade with Russia in the face of the weaker ruble to ensure safe and reliable trade.
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