National Bank spends foreign currency loans on replenishing forex reserves

The National Bank of Belarus resumed the practice of taking loans in foreign currency in the domestic market to replenish the melting gold and foreign currency reserves.

The practice was repeatedly criticised by international financial institutions. The National Bank's former favourite scheme was foreign currency swaps with Belarusian banks owned by non-residents. But the scheme was closed on the IMF's demand, AFN reports.

The National Bank began to actively use short-term loans in foreign markets to show good results (the total amount of the gold and foreign currency reserves) in reports on the check date.

The growing demand for the foreign currency at the end of the year made the National Bank look for new solutions. The regulator secretly placed three issues of foreign currency bonds with a total value of 190 million euros and 30 million dollars. The information about the issues was not published.

The National Bank issued bonds in euros with yields of 5.85 and 6.0% and maturity periods of 6 and 18 months and bonds in dollars with a yield of 6,2638% with a maturity period of one year.

The “secret” bonds are sold to banks (state-run banks) and insurance companies. The proceeds in foreign currency go to the country's gold and foreign currency reserves.

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