VIII Международная студенческая научная конференция Студенческий научный форум - 2016

The urgency of this work can be described by the current situation in the world. There would be no modern monetary economy without the banking system. Also, the banks have no alternatives in the economy. This particular point makes them the key connecting linkage of the whole economic life.

Due to the formation of the Russian Federation in 1991 as an independent state, there began to form an absolutely new structure of banking system. Now it consists of two levels: the Central Bank and the commercial banks also including other financial and credit institutions which are conducting certain banking operations.

Thus, the banking system consists of the Bank of Russia, banks, branches and representative offices of foreign banks, non-bank credit organizations, unions and associations of credit institutions, banking groups and holdings.

The new structure of the Russian banking system began to reflect the needs of a market economy to a greater extent. It is built on the same principles as in the countries with developed market economies. It becomes more adapted to the process of economic reforms. At the same time the process of establishing a new credit system is developing complexly and contradictorily. There still exist some weaknesses.

For example, commercial banks hold mainly short-term credit operations insufficiently investing their money in industry and other sectors.

The purpose of writing this work is to study the banking system of Russia in modern conditions.

To achieve this goal it is necessary to solve the following problems:

1. To study the theoretical aspects of the banking system;

2. To consider the current structure of the banking system of Russia;

3. To analyze statistical data concerning the banking system

4. To identify the problems of functioning of a modern banking system.

The main methods of research are analyses of data, comparison and calculations.

Concepts of the Banking System 1.1 Banking system

The banking system of Russia is a set of national banks and other credit institutions operating in a single finance and credit mechanism. It includes two levels: The Central Bank of the Russian Federation (Bank of Russia) and credit institutions.

The key element of the system is the Bank of Russia. Under current legislation, its authorized capital and other property is the federal property, which it owns, uses and disposes.

The Bank of Russia is a legal entity, with the only exceptional feature that it has no statutes or regulations and is not registered in the tax authorities. This legal norm, however, is disputed by many experts. The Bank of Russia is a nonprofit organization, thus, making profit is not the purpose of its activities.

Profit after sending it to the reserves and funds shall be transferred to the federal budget. The sources of profit are interest income on loans and deposits, income from operations with securities and precious metals, dividends received on shares and shares and other.

1.2 The main objectives of the Bank of Russia

The main objectives of the Bank of Russia are as follows:

1. To protect and ensure the stability of the ruble, its purchasing power and exchange rate with respect to foreign currencies;

1. Development and strengthening of the banking system of the Russian Federation;

1. Provision of efficient and smooth functioning of payments system;

The Bank of Russia has the right to issue cash, withdraw it from circulation, decide whether to release into circulation new banknotes and coins.

The highest authority in the Bank of Russia is the Board of Directors - a collegial body that defines the main directions of its activity. It consists of the chairman of Bank of Russia and the 12 members of the Council.

The second level of the banking system is connected with credit organizations. They are commercial entities which possess legal status. The main motive of their activity is to make profit. On the implementation of credit operations they must obtain a special permission (license) of the Bank of Russia. Credit institutions are formed on the different forms of ownership - private, state, municipal and ownership of associations, and so on.

Credit institutions are divided into two large groups:

1. Commercial banks with the exclusive right to conduct the following banking operations: attracting deposits from individuals and legal entities, placement of these funds on its own behalf and at his own expense on condition of repayment and urgency, opening and maintaining bank accounts of individuals and legal entities;

1. Nonbank credit organizations which can perform only certain banking operations

The legislation makes a clear distinction between bank and non-bank credit organizations. Brand name of the credit institution must indicate the nature of the activities of the legal entity through the use of the words "bank" or "non-bank credit organization", as well as an indication of its organizational-legal form.

A credit institution is able to carry out any transaction in accordance with the legislation of the Russian Federation. As the world practice shows, lenders are able to offer their customers up to 200 types of banking services. However, Russian law had established a direct ban on three types of activities - production, trade and insurance.

Monopolistic activity is also forbidden for credit organizations in particular the conclusion of agreements and implementation of coordinated actions aimed at monopolization of the banking market, as well as the restriction of competition in the banking industry.

A credit institution has no right to unilaterally change the interest rates on loans, deposits, commission fees and terms of these agreements with clients, except in cases provided for by federal law or by agreement with the client.

Loans provided by banks may be provided secured by real estate and personal property, including government and other securities, bank guarantees and other means provided by federal law or treaty.

A credit institution may apply to the arbitration court for the initiation of insolvency (bankruptcy) to the debtor which does not fulfill his obligations to repay debt.

1.3 The concept of commercial banks and their classification

A characteristic feature of the commercial banks, which distinguishes them from state banks and credit cooperatives, is that the main purpose of their work is making a profit (this is their "commercial interest" in the system of market relations).

In the Russian Federation all types of banking credit institutions are divided into two categories: banks and lending institutions.

Under the bank there is understood the commercial organization, which is based on the license of the Central Bank of the Russian Federation which provides with the right to carry out certain banking operations, except for monetary transactions with individuals. In the name of credit institutions there must not be used the term of "bank" and other derived from it terms.

Banks have the right to set up the subsidiary banks and branches of credit institutions. A subsidiary bank (credit institutions) in the Russian Federation is considered to be a bank (lender), in which the parent bank at the expense of its profits acquired more than 50% of the share of authorized capital, and this fact is reflected in its charter.

The relations with the parent bank are regulated by the memorandum and articles of a subsidiary bank (credit institution). This subsidiary bank (credit institution) is a legal entity and operates as an independent commercial entity. It has separate property, including equity, is responsible for its obligations and has a correspondent account in the Central Bank of RCCs of its location.

Branches of the bank are considered to be separate structural units based outside of its location and performing all functions or part of its functions. The branch is not a legal entity and performs delegated by the parent bank operations within the stipulated license of CBR. It concludes treaties and conducts other economic activities on behalf of the commercial bank which created it.

Agency is a separate subdivision of a commercial bank based outside of its location without having rights of juridical entity and not having its own balance sheet. It is created to provide representative bank transactions and other legal actions. Agency is not engaged in computational and credit the customer service and has no correspondent sub-accounts. The current account is opened to carry out business expenses.

Commercial banks can be classified into several groups. Most of these types of banks are a theoretical abstraction, reflecting the views of the respective banks in their "purified" version; in reality "pure" forms do not exist and each group of banks characterized by isolated, dominant, and others features.

Classification of commercial banks in Russia

Criteria	Types of banks
1.Type of ownership	State
	Private
	Cooperative
	Mixed
2.Ownership of capital	Russian
	Foreign
	Joint
3.Territory	Regional
	Interregional
	National
	International
	Russian banks abroad
4. Organizational and legal form	Shareholding
	Joint-stock
5. Level of independence	Independent
	Affiliates
	Satellites
	Authorized
	Consortium
6. Type of activity	Industry specialization Universal	Functional specialization
	Specialized: Industry Communications and Informatics Agricultural Transportation Building Trade etc.	Innovative
		Investment
		Savings
		Social development
		Mortgage
		Clearing
		Exchange
		Insurance
7. The scale of activity	Large, Medium, Small

1.4 Functions of commercial banks

1. Intermediation in credits

1. Stimulation of savings in the economy

1. Mediation in payments between separate independent entities

Main features of Russian banking system 2.1 Key aspects of development of banking system in Russian Federation

In 2013, the Russian banking system continued downward trend in the number of banks. During the year the number of operating banks fell by 52 units on January 1, 2014 amounted to 955 units. In 2012 there was a similar scale to reduce the number of banks (51 per unit). And it is worth noting that in 2013 December was the month with the greatest reduction in the number of banks (the number of operating banks fell by 10 units). In comparison, for the whole 2012 the number of banks was reduced to 34 units.

A distinctive feature of 2013 was that the market did not introduce the new players. Taking into account the dynamics of the emergence of new banks, the scale of the withdrawal of licenses in 2013 was lower than in the previous year.

Key indicators of the Russian banking system in 2008 -2013

Indicator	1.01.08	1.01.09	1.01.10	1.01.11	1.01.12	1.01.13
Assets of the banking sector bln. rubles	7100,6	9696,2	13963,5	20125,1	28022,3	29430,0
Asset growth per year, %	26,8	36,5	44,0	44,1	39,2	5,0
Nominal GDP, bln. Rub.	17048,1	21625,4	26903,5	33111,4	41668,0	39063.6
The ratio of credit institutions' assets to GDP,%	41,7	44,8	51,9	60,8	67,9	75,4
Loans to non-financial organizations, banks and individuals, bln. Rub.	4282,6	6064,7	8 880,0	13705,2	19028,1	18841,4
The ratio of loans to assets,%	60,3	62,5	63,6	68,1	67,9	64,0

During the five-year period, the volume of assets of the banking system increased by 4.14 times. The average annual growth in assets was 32.9% with a significant failure in the period from 2012 to 2013.

It should be noted that in the period 2008-2012 the share of loans to the economy in the total assets of the banking system increased.

There can be seen the growth pattern of volume of the ratio of banking assets to GDP. During the period, the figure rose from 41.7% to 75.4%.

The banking sector is gradually beginning to have a big impact on the real sector, forming the foundation for further growth.

One of the main trends in the period was gradually reducing the price of credit (reduction of the refinancing rate from 14% (January 2007) to 10% (June 2010)). The process was suspended by the financial and economic crisis.

Let us consider a number of characteristics of the monetary system of Russia.

A number of indicators of the credit system of the Russian Federation in 2007 - 2012 years.

Indicator	2007	2008	2009	2010	2011	2012
The increase in consumer prices (CPI) for the year%	11,7	10,9	9,0	11,9	13,3	8,8
The growth of producer price index for the year%	28,8	13,4	10,4	25,1	-7,0	13,9
Accounting rate of the Central Bank of the Russian Federation, on the last day of the year,%	14,0	13,0	11,5	10,5	13,0	8,75
The weighted average interest rates on short-term loans to credit institutions of the Russian Federation in dollars. USA, at end of year	8,5	8,2	8,6	8,9	15,4	14,7

2.2 Profit and profitability of the banking system of Russia

In 2013, the distribution of banks and their internal divisions by region has changed little.

An important result in 2013 was the restoration of profitability of the banking sector. However, the share of unprofitable banks is still at a very high level, and, although he was beaten the record of 2010 (the 2013 profit amounted to 573 billion rub. against 508 billion rub. in 2010), the profitability of both assets and capital was much lower. The return on assets in 2013 was almost 1.5 times lower than the results of 2010, and return on equity almost 2 times.

Profitability of banks	9 months of 2013	2012	2011	2010
Return on equity	11.7%	4.9%	13.3%	22.7%
Return on assets	1.8%	0.7%	1.8%	3.0%
Profits of banks, bln. rub.	360	205	409	508
Profit profitable banks, bln. Rub.	388	285	447	509

At the end of 2013 there were 81 loss-making banks, i.e. 8% of the total. In comparison with 2012 this result is a clear progress, as in 2012 the share of unprofitable banks stood at 11.3%.

Trends and prospects of development of the banking system in Russia

Prospects for the development of the banking system are largely dependent on how the problems will be solved facing this sector of the economy. Disadvantages of the Russian banking system in many respects repeat the shortcomings of the economic model of the country as a whole, although they have their own characteristics.

Main problems of development of the banking system:

1. Low capitalization and the limited capacity of the banking system lending to the economy of the country.

It can be explained by high interest rates and the complexity of lending long-term projects, "nearly 90% of banks are not able to give any credit of volume of 10 million dollars. In general, in Russia there are a few exceptions (Sberbank, VTB, Gazprombank, and others.) There are no large banks. For example, most banks in the country are so small that they could not join any EU country due to lack of capital.

1. Regional and sectoral imbalances in the economy.

According to the data March 2010 50.6% credit institutions operating in Russia are located in Moscow, and in recent years this figure remains almost unchanged. According to some estimates, up to 85% of bank capital is located in Moscow, while in most regions due to a number of reasons there is a lack of money supply.

1. Macroeconomic instability. High inflation and inflation expectations. Lack of sustainability of economic growth, budget execution, investment growth and demand are also important in the analysis of development problems lending market in the country.

1. The unreliability of the banking system also has a negative impact on the development.

The default of 1998, the events of 90-ies and the events of the fall-winter 2008-2009, were marked by the devaluation of the Russian ruble in the course of which was spent a significant part of the reserves of the country once again reinforced the distrust of the domestic banking system.

Prospects of the development of the banking system depend on both the internal and external factors. The internal factors of development must be attributed firstly to the foremost solutions of the above problems. The external factors include the situation in the world financial markets; the situation with the global financial and economic crisis, largely determining the state of the Russian banking system.

Conclusion

In the course of writing this course work there was studied the Russian banking system in modern conditions and following tasks:

1. To study the theoretical aspects of the banking system;

2. The current structure of the banking system of Russia;

3. The problems of the functioning of a modern banking system.

Today, with the development of commodity and the establishment of the financial market, the structure of the banking system is dramatically changing. There appear new types of financial institutions, new credit instruments and methods of customer service.

Search for optimal forms of credit systems, effectively working mechanisms of the capital market, new methods of service of commercial structures. Creation a stable, flexible and efficient banking infrastructure - is one of the most important tasks of economic reform in Russia.

Obviously, it is not enough to announce the creation of new credit institutions. Radical change of the entire system must be made concerning the relations in the banking sector, the principles of relations between banks and their customers.

The foreign practice must be also taken into account.

List of literature

Official documents:

The Federal Law of 02.12.1990 N 395-1 (ed. By 07.13.2015) "On Banks and Banking Activity" (rev. And ext., Joined. In force from 10.12.2015)

Monografies:

1. Gerasimenko V. Ways of development and restructuring of the Russian banking system // Analitic Banking Magazine. 2010. № 4-5.

2. Egorov S.E. On the state of the banking system and ways to strengthen // Money and the credit. 2010.

3. Noskova I.J. Problems of reforming the banking system of Russia // Finances. 2009.

4. Finance, money circulation and credit. Textbook / Ed. V.K. Senchagova A.I. Arzipovoy. - M .: "Prospectus", 2010

Internet resources:

1. Library on economic issues - // Electronic resource: http: // www.libertarium.ru/library

2. Information on the socio-economic situation and development in Russia - // Electronic resource: http://www.finansy.ru

3. Official website of the Central Bank of Russia (analitic materials) - // Electronic resource: http://www.cbr.ru

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