Macroeconomic and Structural Analysis: Econometric Evaluation of Russia’s Economic Dynamics (2000–2021): Equations and Identities of the Banking Sector

This article is yet another publication in a series by the authors exploring the results of the econometric model of Russia, as presented in its 2022 version. It describes the equations and identities of the banking block of the model. The estimated econometric equations characterize ruble and foreign currency deposits of both households and companies. Another group of equations reflects ruble and foreign currency bank loans to organizations, as well as retail bank loans. The identities of the block calculate aggregated indicators characterizing the activities of the banking sector. Elasticities calculated on the basis of estimated equations show that the volume of deposits depends primarily on income, as well as on the monetary and fiscal policy. In turn, loans are dependent on the amount of deposits, as well as on factors such as demand and liquidity. Impulse multipliers of exogenous variables demonstrate that the amount of bank loans in Russia is primarily influenced by the number of economically active population, the volume of public procurement and the state of the world economy. The results of the forecast scenarios illustrate that the volume of loans is highly sensitive to fiscal policy measures (tax rates and the amount of public procurement), to the liquidity of the economy, as well as to the trends of the global economy. The article also provides an industry and regional cross-section of the banking sector in Russia.