WASHINGTON (Sputnik) – The regulation and supervision of the banking system in Russia have significantly improved, however, the system itself continues to remain weak, the International Monetary Fund (IMF) said in a report on Wednesday.
"Bank regulation and supervision have greatly improved in recent years, but there is more to be done," the report stated.
The IMF said major areas of improvement include transfer risks, supervisory interactions with external auditors, as well as related party lending, among others.
However, the Russian banking system remains "weak" overall, and will likely need additional capital, according to the report.
"Even in the baseline scenario, certain banks will need new capital owing to low profitability and increasing credit losses," the IMF said.
The fund urged the Russian authorities to improve the country’s bank resolution framework.
