Russia's Nervous Bank Depositors
Fears are growing that Russia is on the verge of a full-scale banking crisis, after Guta Bank, Russia's 22nd-largest bank in terms of assets, closed its doors on July 6 following a run on deposits. The shutdown comes after weeks of instability, which began in May when the Central Bank withdrew the license of mid-tier Sodbiznesbank, accused of money laundering. Now the crisis is spiraling. Even Russia's No. 1 privately owned bank, Alfa Bank, was forced to deny solvency problems after depositors mobbed branches. Central Bank Chairman Sergei Ignatiev says depositors at Alfa and other big banks have nothing to fear. But he has slashed banks' reserve requirements, just in case.