Professional fraud: how the Kremlin saves the banking system by burning pensions of Russians
The agony of the Russian economy imposed by sanctions continues, and the pace of deterioration of the general situation cannot but rejoice. Although Moscow quite successfully circumvents many restrictions, and the West does not extend them to a number of industries, stagnation is still accelerating.
At the same time, the Russian military-political command sometimes takes the most absurd steps just to correct the schedules for reports, as well as to obtain fake improvements. For example, in order to prevent the total impoverishment of the population and somehow pay pensions, the Kremlin is printing money insanely. Why Russia resembles a ball that is about to burst – we tell in the material of Channel 24 .
It is clear that in the medium term in a crazy crisis, such an approach can only aggravate the situation. However, Putin and his entourage made so many such frankly harmful decisions that the soap bubble called Russia will burst so loudly that it will be heard even on the international space station.
From economic necessity to political expediency – one step
In fact, just a year after the start of a full-scale war, Russia has turned into a solid fake country, where government members are trying to reanimate the half-decomposed body of the economy, and propagandists, like Stalin’s entourage in the first days after his death, pretend that the leader is still breathing.
De facto, the terrorist country is disintegrating very quickly from the economic map of the world, but Putin stubbornly hopes for a financial unification with China, because there is nothing else left for him. This is very similar to the situation with the sale of a bankrupt company to some giant, when, before the offer, scam accountants try to inflate financial indicators and artificially increase the value of the asset.
A striking proof that the Russian economy resembles a puffer fish that puffs up to appear larger than it really is is the situation with its banking system. Any person with even a little understanding of finance knows that the most important indicator of the real state of the economy is the discount rate . This is the percentage at which the central bank lends to commercial institutions and also accepts funds for deposits. The figure set by the regulator indicates how healthy the country's economy is.
If it is lowered, banks will be able to distribute “cheap” money to people, which will lead to the emergence of large sums of money among the population and increase the demand for goods. Inflation will accelerate and price tags will rise. An increase in the discount rate, on the contrary, reduces the craving of banks, enterprises and individuals for loans, while the number of deposits grows (everyone wants to invest money at a higher interest rate), which reduces the inflation rate. Obviously, inadequate decisions of the central bank on setting the discount rate can lead to an incredible skew, which is happening in Russia. The explanation for this is very simple: those responsible for finance are forced to dance to the tune of the political whims of the state leadership.
So, if at the very beginning of a full-scale invasion, the head of the Ministry of Finance, Anton Siluanov, and the head of the Central Bank, Elvira Nabiullina, took advantage of the fact that they were not prevented from extinguishing the fire on the cruiser Moskva, and, unfortunately, made a number of very effective decisions.
- Firstly, the Central Bank instantly raised the discount rate to a record 20%, which allowed the dollar exchange rate not to fly into space.
- Secondly, Russia introduced severe restrictions on the withdrawal of deposits and limited the exchange of currencies.
- The third correct step was the closure of the stock exchanges with the prohibition of the sale of shares.
However, since it was impossible to simply forget about all the problems, and almost the entire business could actually die in a few months, the main financiers of the aggressor country had to gradually let go of the situation. And then, when Russia's spending on the war increased to such levels that it is simply impossible to pull off, the real action began.
Putin's political whims began to dominate economic expediency, which led to the spinning up of the flywheel of inflation, with all the ensuing consequences. The Central Bank was literally forced to lower the discount rate to an unreasonable minimum of 7.5%.
Changes in the discount rate by the Central Bank of Russia for 2022 / Screenshot from Russian pseudo-media
In addition to the Kremlin's completely inadequate demands to simulate problem solving and not to unleash all the bitterness of life on the population at the same time, this continued the trend of the economy multiplying to zero. Fires began to flare up in all sectors, and Russian officials immediately set about extinguishing them with gasoline.
Saved developers by bankruptcy
For example, after the outbreak of a full-scale war and the deterioration of the general economic situation, the Russians mainly thought about how to exchange their son or husband for several million in compensation and where to get at least a couple of extra rubles for food. The same small part of the inhabitants of the swamps, which could earn at least some adequate money, began to look for options for converting “wooden” into dollars to save savings.
It is clear that such a microclimate was not at all conducive to investment in real estate, so banks were ordered to distribute mortgage loans. Like, if the developer sells a bunch of apartments, then the problem will disappear somewhere, but the market does not work like that, because someone still has to pay for such pleasure. Everything would be fine, but there is a huge nuance: almost a quarter of housing loans in 2022 were taken by Russians, whose monthly payment obligations exceed 80% of income. That is, these people will never be able to pay for real estate, and no institution would ever recognize them as solvent and would not agree on issuing a loan to them.
However, Russia is a fake country where this is quite possible. And this can lead to the bankruptcy of a huge number of banks and the collapse of the real estate market as such.
After all, when 82% of the mortgage falls on transactions with new buildings, and the rate on many loans is below 1%, this is even worse than Pushilin's MMM. At the same time, after this pyramid collapses, creditors will not receive anything at all, because the cost of mortgaged housing in this case will cost even less than the life of a prisoner in the Wagner group.
However, the most epic is the fact that when the Central Bank intervened, it was already too late, and the sharp increase in the conditions for issuing mortgages practically made developers euthanasia. So, according to Rosregistr, in February 2023 in Moscow, the sale of real estate in the primary market fell by as much as 48%. Investment has left the chat.
Swings on the Moscow real estate market / Screenshot from Rosregistr
About the situation in other cities of Russia, where the demand for real estate has always been not so great, and the chances of the ordinary population to see a million rubles live are equal to Putin's ability to take Kiev, there is nothing to say.
What will the Kremlin leaders do now in a situation where no step will lead to improvement? The question is rhetorical. However, it must be admitted that war criminals stubbornly demonstrate ingenuity and, unfortunately, quite successfully postpone the statement of their economic death. Perhaps they will come up with options for how to rearrange the timer on this bomb.
Imitation of banking success
So it's not even worth explaining how Russian banks feel in such a situation. They are, of course, all right. However, only in words. Sberbank, for example, on March 20 quite unexpectedly announced the payment of record dividends to shareholder – 25 rubles per share.
The decision to pay dividends was made by the heads of the financial institution due to “very good forecasts” and “excellent results for 2022.” Like, since the largest bank in Russia was able to earn a net 270 billion rubles, it is possible to please the holders of securities. Only here is a small nuance: in 2021, Sberbank made a profit of 1.25 trillion “wood”, and all the achievements of a financial institution are that it did not work at a loss.
The scheme with record payments is very simple and tested at Gazprom in August last year. Insiders who are aware of the intention to announce dividends began buying Sberbank shares when they cost 156 rubles. After the supervisory board officially announced its intention to pay more than the shares are really worth, their value jumped to the level of 202.8 rubles. It was exactly the same with the gas producing corporation, when investors rushed to buy securities in the hope of earning extra money, but by the end of the dividend cutoff, the price fell sharply. Everyone who had insider information got rich. Gazprom managed to earn extra money out of thin air, and ordinary market players financed it. Imitation of success.
September 2022 is the peak of purchases of Gazprom shares against the backdrop of inflated expectations. October 2022 – meeting investors with reality / TradingView screenshot
Perhaps the situation in the Russian banking sector is not as bad as it seems at first glance? What if the “squeezed out” Tinkoff is all right? No, it seemed. This giant of swamps skillfully goes to the bottom.
Shares of Tinkoff Bank demonstrate confidence in the future / Screenshot from the TradingView website
But at the same time, on the website of a financial institution, which even officially over the past six months has shown a profitability of almost minus 10%, they draw promises of a rise in share prices by as much as 43.62%. Recommended to buy (s).
Forecasts at the level / Screenshot of the bank's website
Retirement savings burn with a blue flame
However, even the situation with Tinkoff cannot be called the most gloomy, because there is a Russian VTB. Such a financial institution with assets of more than 20 trillion rubles, which has never shown its effectiveness at all. To illustrate the “professionalism” of the bank, it is only worth noting that its supervisory board went public with the sale of its shares in the crisis year of 2008. At that time, the value of the security, apparently, was due to the price of the A4 sheet and amounted to 14 kopecks (less than one cent at the then exchange rate). Since then, a lot of funds have been constantly poured into VTB and additional capitalization has been carried out, however, as of March 2023, a bank share costs 1.8 kopecks (0.02 cents). Phenomenal 96% negative growth in stablecoin.
At the same time, apparently, none of the Russian leadership is worried at all that one of the giants of the market can demonstrate at least some income solely by attracting additional investments. And it is VTB that generously distributes loans to all unprofitable state-owned companies, that is, money constantly goes nowhere without a chance of increasing it. So there is nothing to be surprised that when almost all Russian banks flew into the abyss, it became worse for the descendant of the Soviet Vneshtorgbank. What should be done when such a powerful financial institution once again fails to cope, and the state has no money? That's right, throw him into the furnace of Russian pensions. Just call it not burning savings, but an attractive investment.
At the beginning of 2023, VTB announced that it had found those willing to purchase all of its shares as part of the second additional issue. “Lucky” were all those who set aside their money for a comfortable old age in the pension funds of “Gazprombank”.
Pensions of Russians will be thrown into the furnace of VTB Bank / Screenshot from Russian pseudo-media
In total, the Russians brought 1 trillion 156 billion rubles to the four pension funds of Gazprombank, and although not all of these funds will be spent on the purchase of VTB shares (at least now), there is no doubt that none of the depositors will ever will not wait for a penny of payments from the financial institution. After all, if a non-state PF began to invest in such risky enterprises, and this is also due to political necessity, as they say: “We have bad news for you.” And no one cares that according to the law, non-state pension funds must invest in reliable assets. In this context, the slogan of the Gazprom funds “taking care of your future” looks as epic as the news on their website with the headline about guarantees from the state.
In “Gazprom” understand the theft of money from Russians / Screenshot from the website of the company sponsoring terrorism
So the assumptions that soon Russia will begin to withdraw their deposits from its citizens no longer look like jokes.
Only foreigners afloat
In fact, the only financial institutions that are more or less comfortable in the Russian market are international banks that are not ashamed to finance the killing of civilians. An exception can be considered only the “daughter” of UniCredit Group, which worked 2022 with a loss.
Thus, according to open data, the French group Crédit Agricole, which officially announced its exit from the Russian market, received 3.7 million euros of profit for 12 months last year. The Hungarian OTP Bank in Russia earned much less than in 2021, but brought its owners 3.9 billion rubles. But Raiffeisen Bank, which even recognized the “DNR” and “LNR”, and generally became the bank No. 2 in the aggressor country. The profit of the Austrian subsidiary increased by 4.3 times and amounted to 2 billion euros.
Such performance is due to the simple fact that these banking institutions have not been sanctioned or cut off from SWIFT. They instantly became monopolists in the money transfer market, which willingly help the population of the terrorist country to maintain financial ties with the world without any restrictions.