OREANDA-NEWS. July 20, 2007. "We are glad that the European Commission elected Italy as our partner in the Twinning Project, since large scale privatization in financial sector had been carried out in that country, experience of which can be very helpful for Russia" - stated Deputy Head of Federal Antimonopoly Service of the Russian Federation (FAS Russia) Mr. Andrey Kashevarov, opening Conference "Perspectives of the European banking and financial systems", reported the press-centre of FAS Russia.

"Competition in banking sector is the key element of financial system" resumed Mr. Hans Schoof, Head of Operations Unit of the European Commission Delegation to Russia. As he said, Twinning Project - within the framework of which the Conference was taking place - united governmental authorities of Russia, Italy, the EU for team-working on development of competition. "Everybody benefits from exchange of experience and information since issues of competition in the financial sector are topical not only for Russia, but also for the countries of the European Union" - Mr. Schoof pointed out.

Deputy Minister of Economy and the Finance of Italy Mr. Roberto Pinza in his address drew attention of the audience to the fact that Italy is one of the countries of the European Community most densely cooperating with the Russian Federation. He considered the Twinning Project the successful initiative which corresponds to the strategic line of cooperation between Russian and European authorities.

Two Sessions of the Conference were dedicated to cross-border merges and the role of public sector and also to convergence of positions and cooperation of the Russian financial institutions with the European financial system. The presentations were delivered by Mr. Alexey Savatyugin, Director of Department for Financial Policy of the Ministry of Finance of the Russian Federation and Head of the Federal Insurance Supervision Service Mr. Ilya Lomakin-Rumyantsev.

Director for Banking Supervision of Bank of Italy Anna Maria Tarantola and the President of "Unicredit Group" Alessandro Profumo dealt in their presentations with changes that occurred in the banking system in 1990s. Experience of Italy shows that a large-scale privatization should be accompanied by strengthening supervisory bodies and building up legal base. The coexistence of state-owned and private banks appears to be effective if they are subjected to single rules of the market. If so, there is a reduction of number of banks, but not reduction of amount of services, when transiting to the advanced, competitive bank system.

The other speakers at the Conference were: Mr. Marcello Messori, President of the Italian Association of Assets Managers "Assogestioni"; Mr. Andrea Enria, Secretary General of Committee of the European Banking Supervisors.

Closing the Conference, Deputy Head of the FAS Russia Mr. Andrey Kashevarov noted that participants of Twinning Project had identical approaches to estimation of the role of competition and state participation in financial markets: state participation is necessary where private capital is inefficient for some reasons; one of the primary goals of regulatory bodies is formation of conditions for development a stable and highly competitive banking system that enjoys confidence of consumers.

Background information:
The Twinning Project aims to enhance competition in the banking and financial sectors of the Russian Federation, through a reduced participation of state and regional authorities in the capital of financial institutions. The project is implemented by the beneficiary institution - the Federal Antimonopoly Service of the Russian Federation - jointly with the Italian Ministry of the Economy and Finance - Department of the Treasury, and supported by three mandated bodies: Italian Competition Authority, the Bank of Italy and "Studiare Sviluppo srl".

Economic and legal experts from Italy and other EU countries have been working in the beneficiary country since November 2006, cooperating with the FAS Russia, as well as with the Ministry of Finance, the Ministry of Economic Development and Trade, the Central Bank of the Russian Federation and the Federal Service on Financial Markets.

In accordance with the work-plan agreed with the European Commission Delegation, project partners are developing analyses and reports on the privatization processes, competition rules and related implementation.