OREANDA-NEWS. September 4, 2008. The allowed share of foreign capital in the Belarusian banking system has been raised from 25% to 50%. The decision was taken by the National Bank administration in accordance with article 90 of the Banking Code of Belarus and instructions of the head of state.

The decision is attributed to the growing interest of foreign strategic investors in Belarusian banking. They are ready to invest in authorised funds of existing banks and in setting up new financial institutions.

At present the foreign capital share in the overall authorised fund of Belarusian banks stands at 22.2%.

The decision is expected to create the necessary conditions for attracting new technologies into the Belarusian banking industry, enhancing its financial potential and improving the number and quality of banking operations and provided services, said the source. Apart from that, the measure is supposed to help increase the stability and effectiveness of the operation of the Belarusian banking system and the national economy as a whole.

There are 28 banks in Belarus. As of July 1, 2008 the normative capital of the banking industry totalled Br7,277.9 billion or an equivalent of USD3.4 billion, 11.5% up in H1 2008. In January-June 2008 the total authorised fund of Belarusian banks gained Br0.5 trillion to reach Br5.1 trillion on July 1 (USD2.4 billion). In H1 2008 profits of Belarusian banks totalled Br402.1 billion (USD189.2 million).

As of July 1, 2008 the Belarusian banking industry had 22 banks with a share of foreign capital in their authorised funds, including 6 foreign-owned banks. In 10 banks the share of foreign capital varies from 50% to 100%, 4 banks — from 10% to 50%, 2 banks — less than 10%. Authorised funds of Belarusian banks have capital from Russia, Cyprus, Austria, Ukraine, the UK, the Netherlands, Switzerland, Luxembourg, Kazakhstan, Latvia and other countries.

In early 2008 the share of foreign investments in the total authorised fund of Belarusian banks totalled 9.8%, 17% up in H1 2008. Over the six months of the year the gross foreign investments channelled into acquiring bank shares on the primary market of the Republic of Belarus amounted to USD88 million and ?31 million (USD65.8 million and EUR 15.3 million in 2007).

As of July 1, 2008 the overall face value of bank shares owned by Belarus non-residents stood at an equivalent of USD410.3 million.