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Federal Treasury Fiscal Operations Division Operations to Manage Balances

Federal Treasury Fiscal Operations Division Operations to Manage Balances in the Treasury Single Account Moscow 2017. Key Stages of Operations Development. MoF and Treasury decision on the need for cash management.

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Federal Treasury Fiscal Operations Division Operations to Manage Balances

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  1. Federal Treasury Fiscal Operations Division Operations to Manage Balances in the Treasury Single Account Moscow 2017

  2. Key Stages of Operations Development MoF and Treasury decision on the need for cash management Placing funds in bank deposits – first operations Central Bank- MoF-Treasury Legal framework for placement of funds in bank deposits Deposits – anti-crisis instrument of the Russian Government New mechanism for placing Treasury’s deposits New authority of the Treasury – to manage cash balances Loans to municipal entities Foreign currency purchasing Loans to constituent entities of the Russian Fed. Foreign-currency deposits Purchasing foreign currency on stock exchange Instruments to attract funds Demand deposits Multi-day repo Overnight repo Currency swap

  3. Key Objectives of Operations

  4. Key Elements of Operations

  5. Some Elements of Operations

  6. Types of Operations

  7. Requirements to Lending Organizations when Placing Funds in Bank Deposits • Hold General License issued by the Bank of Russia • Own funds (capital) from 250 billion rubles • Have Russian rating at least at the investment grade level (ACRA) 6 banks • Hold General License issued by the Bank of Russia • Own funds (capital) from 5 billion rubles • Have international rating at least at the investment grade level (Fitch-Ratings, Standard & Poor's, Moody's Investors Service) 24 banks

  8. Arrangements for Placing Funds in Bank Deposits Terms of Placement Treasury of Russia 1 3 Tender Set of Applications Cut-off Rate 4 2 Applications for Funds Within the Limit Offer Trade Mechanism (applied software of Stock Exchange ) Funds Transfer 5 Contract Award 7 Lending Organizations 6 Offer Acceptance 9 Drawdown 8 Account Statement 9

  9. Results of Placing Funds in Bank Deposits as of 01.03.2017 Revenue Amount Placement Amount

  10. Arrangements for Carrying Out REPO Operations Government Securities Applications Register, Agreements Register Russian MoF Treasury of Russia Selection Criteria, Cut-off Rate Report 6 Bank of Russia Purchase Offer Bank of Russia 1 3 Cut-off Rate Set of Applications Trade Settlement 4 Tendering 5 2 Sale Applications (limit) Trade Mechanism (Depositary, Clearing Organization) Budget Funds Lending Organizations Trade Settlement 5

  11. Results of Carrying Out REPO Operations for 2015-2017 (as of 01.03.2017) Placement Amount, billion rubles Revenue Amount, billion rubles 7 and more days 7 and more days

  12. Key Conditions for Issuing Public Budget Loans

  13. Arrangements for Issuing Public Budget Loans Fed. Treasury Territorial Office Borrower’s Account 40201,40204 Federal Treasury Central Office 3 Application for Funds (2d day) Account Replenishment (4th day) 4 Fiscal Operations Division Loan-related Reporting (every 10 days) 6 2 1 Verification: -authority of officials • fitting in the fund limit (1/12 of revenues) • term up to 50 days • repayment until 25 Nov • interest rate according to the budget law • limitations Addendum to the Agreement (Loan Agreement) signed by the Borrower (loan amount, term, interest rate, date of borrowing and date of maturity) (within 4 days) Borrower (in the person of an authorized body) 5 Loan Agreement Signing and Funds Transfer (4th day) or Rejection

  14. Results of Issuing Public Budget Loans for 2014-2017 as of 01.03.2017 2,297.6 billion rubles 151.0 billion rub.

  15. Key Conditions for Foreign Currency Purchase

  16. Arrangements for Foreign Currency Purchase Revenues Transfer Bank of Russia Treasury of Russia 3 Russian Treasury's Account Foreign Currency Purchase 2 4 Information on the Results of Foreign Currency Purchase Order on the Use of Additional Oil and Gas Revenues 1 MoF

  17. Foreign Currency Purchase Statistics Paid % revenue 9,893.1 thou. rubles Paid % revenue 285.9 thou. rubles Transferred to the Reserve Fund

  18. Consolidated Information on Cash Balance Management Operations for 2008-2016 as of 01.01.2017 Revenue Amount Placement Amount 98,574.58 billion rubles 319.58 billion rubles

  19. Risk Management in Operations • Arrangement for internal control • Division of authority (front-office, back-office, middle-office) • Regulatory Framework: • Setting requirements to lending organizations (gen. license, capital, lack of liabilities for FT operations etc.) • Entitling Treasury to: • non-acceptance write-off of lending organization's liability in respect of deposit operations and repo agreements; • write-off of budget loan liabilities against revenues in the regional and local budgets; • open carrying-out of operations (www.roskazna.ru) Agreement on service quality control with contractors (Public JSC Moscow Exchange, Non-bank Lending Organization JSC National Settlement Depository)

  20. Prospects of Operation Types Development • Currency Swaps • Direct Repos • Loan Attraction • Demand Placement • Currency Swaps • Purchase/Sale of Foreign Currency on Stock Exchange • Non-Budgetary Funds, Public Corporations

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