{
  "title": "Republic of Belarus: Financial System Stability Assessment",
  "publication": "IMF Staff Country Reports, September 21, 2016",
  "sourceUrl": "https://www.imf.org/en/publications/cr/issues/2016/12/31/republic-of-belarus-financial-system-stability-assessment-44280",
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  "summary": "This paper presents an assessment of financial system stability in Belarus. The findings reveal that the state-dominated financial sector of Belarus confronts several critical challenges.",
  "publishDate": "2016-09-21",
  "series": "IMF Staff Country Reports",
  "sections": [
    {
      "heading": "Overview",
      "content": "- This paper presents an assessment of financial system stability in Belarus.\n- The state-dominated financial sector of Belarus confronts several critical challenges.\n- Deep and long-standing structural problems and negative external spillovers are distorting the credit channel and overall financial stability.\n- Financial sector contingent liabilities are on the rise, accentuating an already weak fiscal situation.\n- The government is directing a large proportion of loans from state-owned banks to unhedged state-owned companies.\n- Foreign currency liquidity risk is high.\n- Transition to independent and risk-based oversight of the financial sector is urgently required."
    },
    {
      "heading": "Key findings",
      "content": "- State dominance of the financial sector is a central structural vulnerability.\n- Credit channel distortion is driven by directed lending to state-owned companies.\n- Financial sector contingent liabilities are increasing and worsening fiscal vulnerabilities.\n- Foreign currency liquidity risk is assessed as high.\n- Independent and risk-based oversight of the financial sector is absent and urgently needed."
    },
    {
      "heading": "Risks and vulnerabilities",
      "content": "- Contingent liabilities from the financial sector are rising, adding pressure to an already weak fiscal position.\n- Concentration of lending: a large proportion of loans from state-owned banks are directed to unhedged state-owned companies, increasing credit and liquidity risks.\n- External spillovers and persistent structural problems are amplifying domestic financial-stability risks.\n- Foreign currency liquidity risk remains elevated."
    },
    {
      "heading": "Policy recommendations and required actions",
      "content": "- Move toward independent and risk-based oversight of the financial sector.\n- Reduce directed lending by state-owned banks to unhedged state-owned enterprises to mitigate credit and contingent liability risks.\n- Strengthen fiscal buffers to absorb rising financial sector contingent liabilities.\n- Address foreign currency liquidity vulnerabilities through appropriate supervisory and market measures.\n\n---\n\n Content in this bundle\n\n- Republic of Belarus: Financial System Stability Assessment; IMF Country Report 16/299; July 25, 2016\n  - Republic of Belarus: Financial System Stability Assessment; IMF Country Report 16/299; July 25, 2016 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Republic of Belarus: Financial System Stability Assessment; IMF Country Report 16/299; July 25, 2016 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/cr/issues/2016/12/31/republic-of-belarus-financial-system-stability-assessment-44280"
    }
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    "Published: September 21, 2016",
    "Series: IMF Staff Country Reports",
    "DOI: https://doi.org/10.5089/9781475537192.002",
    "This paper presents an assessment of financial system stability in Belarus.",
    "The state-dominated financial sector of Belarus confronts several critical challenges.",
    "Deep and long-standing structural problems and negative external spillovers are distorting the credit channel and overall financial stability.",
    "Financial sector contingent liabilities are on the rise, accentuating an already weak fiscal situation.",
    "The government is directing a large proportion of loans from state-owned banks to unhedged state-owned companies.",
    "Foreign currency liquidity risk is high.",
    "Transition to independent and risk-based oversight of the financial sector is urgently required.",
    "State dominance of the financial sector is a central structural vulnerability.",
    "Credit channel distortion is driven by directed lending to state-owned companies.",
    "Financial sector contingent liabilities are increasing and worsening fiscal vulnerabilities.",
    "Foreign currency liquidity risk is assessed as high.",
    "Independent and risk-based oversight of the financial sector is absent and urgently needed.",
    "Contingent liabilities from the financial sector are rising, adding pressure to an already weak fiscal position.",
    "Concentration of lending: a large proportion of loans from state-owned banks are directed to unhedged state-owned companies, increasing credit and liquidity risks.",
    "External spillovers and persistent structural problems are amplifying domestic financial-stability risks.",
    "Foreign currency liquidity risk remains elevated.",
    "Move toward independent and risk-based oversight of the financial sector.",
    "Reduce directed lending by state-owned banks to unhedged state-owned enterprises to mitigate credit and contingent liability risks.",
    "Strengthen fiscal buffers to absorb rising financial sector contingent liabilities.",
    "Address foreign currency liquidity vulnerabilities through appropriate supervisory and market measures.",
    "**Republic of Belarus: Financial System Stability Assessment; IMF Country Report 16/299; July 25, 2016**"
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