The Russians Are Coming To Banking SchoolKelley Holland
In the old Soviet Union, few Americans came in for more opprobrium than bankers. But times have changed. Last month, close to 250 Russians sat in Connecticut's Fairfield University auditorium and listened intently as Russian U.N. envoy Yuli M. Vorontsov remarked that David Rockefeller, former chairman of Chase Manhattan Bank, was "a very good example to follow in banking."
Those in the audience, hailing from Russia, Kazakhstan, and Belarus, were themselves bankers, settling in for a five-week stay at Fairfield to study banking, American style, under the aegis of the Russian-American Bankers Forum, a joint project of top American and Russian financiers and the Federal Reserve Bank of New York. "We're in a good position to give advice," says former New York Fed President E. Gerald Corrigan, alluding to the problems that have plagued American banks in recent years. "We know what to avoid." The program is part of a broad-based effort by Westerners to help the student bankers modernize their financial system.
There's a lot of work to be done. At present, simple transactions can take months to clear and payment orders, not checks, are the norm. Only a fifth of the 2,000 or so commercial banks in Russia have more than one branch, which makes putting together big-project loans difficult. And while computers are coming more into fashion, some computations are still made on an abacus.
SKEPTICS. U.S. efforts to help build a pilot check-processing system exemplify the challenges. The project is in Tula, a city south of Moscow, because it has a workable interbank communications system. The Russian transportation system can't handle the shipping of checks throughout the vast country, so the Westerners are working on ways to give customers electronic records of their checks.
Most of the Russians seem eager to pick the Americans' brains. Menatep, a Russian commercial bank, sent a computer programmer to Fairfield who, when he returns home, will teach 100 Menatep staffers what he has learned. But some are skeptical of East-West cooperation. Peter Derby, president and chief executive officer of Moscow's DialogBank, says the Central Bank of Russia's view "is that anyone who goes to the West just wants a trip and VCRs." Others feel the program may allow Americans to gain undue influence over the shape of Russia's banking system. The central bank is limiting foreign licenses. Although two American banks are applying for licenses, Credit Lyonnais and the Bank of Austria are the only Western banks to have them.
If they don't want to rile the Russians, the educational ambassadors must step carefully. "We want to help our friends in Russia do what they think is right for Russia," Corrigan says. With luck, the Russians will take the lessons to heart--and shelve their abacuses.