Borrow till the payday: Ministry of Finance returns to the debt market

Loan plans coincided with alarming figures for federal budget revenues and expenditures.

Yekaterina Maksimova

The agency's website published the schedule and volume of federal loan bonds placement. The first auction will take place on Wednesday, September 14th. Then 21 and 28 September. The total amount of federal loan bonds will amount to 40 billion rubles (with a placement period of 5 to 10 years - 30 billion rubles, from 10 years - 10 billion rubles).

During the Moscow Financial Forum on September 8, Deputy Finance Minister Timur Maksimov said that the Ministry of Finance, after a long break, "will test the market with a limited volume".

Analyst FG "Finam" Alexey Kovalev considers such a test reasonable. "A lot has changed since the last auction, and we need an understanding of how to act in the new conditions", - Kovalev said.

He also clarified that the "new conditions" mean the absence of non-residents, an increase in the role of retail investors, and a decrease in trading on the stock market.

Anton Tabakh, chief economist at the Expert RA agency, also notes that after a long break and the introduction of restrictions for non-residents, the Ministry of Finance enters the market in small volumes in order to "try the water" and test changes in the exchange infrastructure.

"The volume of new issues is quite insignificant against the background of the total federal loan bonds volumes (15 trillion rubles in circulation, of which about 2.7 trillion are held by non-residents and transactions with most of them are still limited), as well as against the backdrop of hundreds of billions of daily exchange turnovers", - explained Anton Tabakh.

Independent financial expert Dmitry Vigulyarov believes that the auctions, although in the new reality, will be held according to the standard scheme. "The Ministry of Finance enters the market for a limited circle of people, looks at the demand, the demand sets the sale price. Then the bonds go to the secondary market", - Vigulyarov said.

All experts confidently assert that ordinary Russians will not be allowed to participate in the auctions. Dmitry Vigulyarov believes that federal loan bonds will be bought out by large financial structures. Aleksey Kovalev suggested that the main buyers of federal loan bonds would be the owners of redeemable securities - non-credit financial institutions, systemically important credit institutions, and other banks. Anton Tabakh agrees with the opinion of his colleagues and notes that non-residents will definitely not be among the buyers of federal loan bonds this time.

Alexei Kovalev believes that the Ministry of Finance needs to go "for exploration" in order to prepare for large loans next year. And the Ministry of Finance speaks openly about the fact that the state will have to borrow money.

“Timur Maksimov said the day before that in the long term, of course, the approval of a new design of budget rules is primary, that is, “a certain structure should appear that will provide, as a derivative, the need to raise financing in the market”. Other sources of financing the deficit, the deputy minister said, in It's hard to imagine in the current conditions", - reminds Aleksey Kovalev.

The "new construction of budget rules", which Mr. Maksimov spoke of as being primary, was announced by Finance Minister Anton Siluanov back in the first half of the year. We are talking, among other things, about foreign exchange interventions - the purchase of foreign currency, which is then transferred to the reserve.

The Ministry of Finance has repeatedly confirmed that it is ready to buy foreign currency for oil and gas windfalls, but now it will be the funds of friendly countries. For example, the Chinese yuan. Against the backdrop of such interventions, experts have repeatedly explained, the ruble should weaken: the more the state buys other people's money, the cheaper the national currency becomes. And a strong ruble to the federal budget, one of the sources of replenishment of which is payments from foreign exchange exporters, is dangerous.

The ministry promises to approve the concept of new budgetary rules by October 1 - until the submission of the draft federal budget for 2023-2025.

As for federal loan bonds, in 2022 the Ministry of Finance planned to issue at the level of almost 2.2 trillion rubles. Since the beginning of the year, three auctions have been held, and after February 9, the department did not enter the debt market. That is, the autumn issue of 40 billion rubles for the country is mere pennies.

Novye Izvestia reported that the parameters of the federal budget in 2022 worsened. On the eve of the Ministry of Finance published a preliminary assessment of the execution of the federal budget for January - August.

Federal treasury revenues for this period amounted to 17.606 trillion rubles (70.4% of the annual volume), expenses - 17.469 trillion rubles (73.7%). The surplus decreased to 138 billion rubles (against 1.08 trillion rubles in 2021 and 1.4 trillion in the first half of 2022).

From January to July inclusive, we recall, the budget received 15.77 trillion rubles, expenditures amounted to 15.29 trillion. The surplus then fell to 482 billion rubles. At the same time, a record deficit of 892 billion rubles was recorded directly in July against a surplus in the first half of the year - 1.4 trillion rubles.

Accordingly, only one month - July - reduced the semi-annual surplus of the federal treasury by almost two-thirds. And in August, it turns out, the deficit amounted to about 345 billion rubles. At such a rate of spending, by the end of the year or even in the fall, the federal budget may reach a deficit level.