Fears of banking crisis grip Russian financial markets

[dArKeR]

AFP , MOSCOW

Fuelled by a credit crunch and rumors of a list of banks soon to be closed, fears of a new banking crisis gripped Russia's financial markets last week as analysts hurried to assure there was no cause for panic.

A repeat of the 1998 financial crisis is unlikely, analysts say, because the central bank has plenty of reserves to provide any needed liquidity, and with no sign of retail panic, the tension will likely blow over.

Once the smoke clears, however, many of Russia's myriad of small "boutique" banks may find themselves out of business, they say.

"There is no cause for any banking sector crisis," wrote Moscow's Renaissance Capital investment bank. "If necessary, the central bank can and will step in by injecting liquidity into the inter-bank market."

http://www.taipeitimes.com/News/worldbiz/archives/2004/06/14/2003175052

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