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Evolution of the Banking System in the Russian Context: An Institutional View



We undertook an institutional analysis of commercial banks in Russia. After the failed experiment with private financial intermediation in the 1990s, Russia migrated towards a banking system consisting of three — rather than two — tiers and featuring core institutions controlled by the state directly or indirectly. This evolution is consistent with this country's historical pattern of financial intermediation. It is also in line with recent trends in the real sector of the economy, where public ownership has rebounded over the past decade. The core state-controlled banks have evolved into hybrid institutions, performing two various sets of functions: those of regular commercial banks and of policy banks. We found a similar evolution in China, but not in the transitional economies of central Europe. Institutional matrix theory suggests that, in non-market economies, centralized finance and credit allocation is the dominant institutional form, while private banking activity is complementary.

Suggested Citation

  • Svetlana Kirdina & Andrei Vernikov, 2013. "Evolution of the Banking System in the Russian Context: An Institutional View," Journal of Economic Issues, Taylor & Francis Journals, vol. 47(2), pages 475-484.
  • Handle: RePEc:mes:jeciss:v:47:y:2013:i:2:p:475-484
    DOI: 10.2753/JEI0021-3624470221

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    Cited by:

    1. Svetlana Kirdina, 2013. "Economic Policy For Real Sector And R&D Financing: Basic Institutional Models," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 9(4), pages 39-52.
    2. Vernikov, Andrei, 2014. "Сравнение Институциональной Структуры Банковских Систем России И Китая
      [Comparing the institutional structure of Russian and Chinese banking systems]
      ," MPRA Paper 64339, University Library of Munich, Germany.
    3. Kirdina, S., 2013. "Institutional Models of Real Sector Financing," Journal of the New Economic Association, New Economic Association, vol. 18(2), pages 129-155.

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