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Central Bank of Russia


The Central Bank of Russia (CBR) is the highest monetary authority in the Russian Federation. It sets and carries out Russian monetary policy, supervises the commercial banking system, and maintains the payments system. In addition, it holds majority ownership in Vneshtorgbank (Russia's state-controlled foreign trade bank) and Sberbank (the state savings bank). The Russian Constitution (ratified in December 1993) and the "Revised Law on the Central Bank" (passed in April 1995, modifying the 1990 Russian Soviet Federated Socialist Republic "Law on the Central Bank") jointly provide the legal basis for its activities. Both the constitution and the revised law grant the CBR a high degree of formal independence from the government. While scholars disagree over the extent of the CBR's actual political independence during the post-communist transition, all concur that its policies played a pivotal role in Russian economic development.

The Russian Republic founded the CBR in July 1990, and Georgy Matyukhin, an academic, became its first director. This occurred in the context of a fierce sovereignty battle between the Soviet central government led by Mikhail Gorbachev and the Russian republic government led by Boris Yeltsin. Russian authorities transformed a branch of the State Bank of the USSR (Gosbank) into the CBR in an attempt to gain local control over Russian monetary and banking affairs. Both the Soviet and Russian governments subsequently took numerous steps to increase the influence of their respective central banks, and this so-called "war of the banks" represented one of the first efforts by a republic-level institution to pull away from the center. The struggle ended with the dissolution of the USSR in December 1991. On January 1, 1992, the CBR took over the rest of Gosbank's resources in Russia, and Gosbank officially ceased to exist.

In April 1992, the CBR leadership passed from Matyukhin to former Gosbank director Viktor Gerashchenko. Numerous controversial incidents characterized Gerashchenko's first tenure as CBR head (19921994), such as the July 1992 decision to wipe out mutually accrued debt among Russian enterprises, thereby formally ending Russia's flirtation with "shock therapy"; the surprise introduction of a new Russian currency in July 1993; and Gerashchenko's support for the Russian parliament after Yeltsin's September 1993 decision to disband it. Gerashchenko lost his job in November 1994 as a consequence of the ruble's exchange rate collapse on "Black Tuesday" (October 11). His deputy Tatiana Paramonova served as acting CBR director until November 1995, when the Russian Duma confirmed former acting finance minister and commercial banker Sergei Dubinin as CBR head. Dubinin was forced out after the massive Russian financial crisis of August 1998, which many blamed on CBR policy. Gerashchenko replaced Dubinin and enjoyed a second stormy tenure at the CBR until his resignation in March 2002. The Duma confirmed Russia's deputy finance minister, Sergei Ignatiev, as the new director shortly thereafter.

See also: banking system, soviet; gosbank; sberbank.


Central Bank of Russia. (2003). Available from <>.

Johnson, Juliet. (2000). A Fistful of Rubles: The Rise and Fall of the Russian Banking System. Ithaca, NY: Cornell University Press.

Knight, Malcolm; Arne Petersen; and Robert Price. (1999). Transforming Financial Systems in the Baltics, Russia, and Other Countries of the Former Soviet Union. Washington, DC: International Monetary Fund.

Tompson, William. (1998). "The Politics of Central Bank Independence in Russia." Europe-Asia Studies 50(7): 11571182.

Juliet Johnson

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