I would now like to address the objectives that we are yet to complete. The most pressing problem is lending to business owners. The standard N25 restricting financing of one’s own projects was introduced this year but is still only applied in a preferential mode. Lending to owners is dangerous for two reasons. First, the bank will turn a blind eye to risks linked to its own company when issuing it a loan i.e. the risk of non-return. Second, our practice has shown that if the owner’s project really experiences difficulties the last place it returns money is the affiliated bank. These are not marketable loans but loans extended by unwritten rules. Banks cannot refinance or resell them. In the end, this is the cause of bankruptcy for many banks. It is one of the factors that led to the collapse of relatively large banks, whose licenses we revoked. We want the banking community to know that our intentions in this field are serious and we will continue to take a tighter stance. Therefore, I advise those whose business model is built on lending to owners to seriously consider finding alternatives. Yet another problem is the quality of banks’ capital. We need to be confident that our banks have real, not borrowed, capital. Therefore, as of this year we will be introducing tighter regulation on the quality of capital. When calculating a bank’s capital, we will not take funds from nontransparent sources into account. There is another whole host of problems associated with collateral.
For example, big data, riskoriented decision-making systems, credit decisions, the use of complex mathematical models in the risk management system, and working with open interfaces and cloud computing. All this suggests that soon there will be high proportion of risks that are technological in nature rather than financial. We need to be ready to face these risks. Our objective is to elaborate uniform standards for working with databases, data quality, and develop the requirements on models applied in data outsourcing, and requirements on information security. This is a great deal of work. We will develop approaches while engaged in dialogue with the industry. The revolution in the use of data has had an impact on both financial institutions as well as regulators like us, the central bank. We need more data about deals and transactions. Then, we need to use modern data analysis methods. For this, we will optimise the reports that are submitted and introduce formats that are convenient for the market such as XBRL. I would like to highlight the fact that we will be working to improve quality control and data management systems and you will benefit from lower regulatory costs. The last area of work I would like to mention is one of the most important: protecting consumer rights. Our objective in this area is absolutely clear – financial decisions should not lead to misfortune in consumers’ lives.