The Bank of Russia confirmed the significant reduction in the surplus liquidity in the banking system in April, from 2.3 trillion to 1.4 trillion, however, this change will be instantaneous — as of the end of 2020. Central Bank now forecasts at least a full recovery of liquidity, mostly it was about the growth in cash ruble and the reduction of foreign currency assets. In April, the banks kept correspondent accounts with the Central Bank 3 trillion Combination of cost structures and policies of the Bank of Russia allowed the financial system to undergo an initial March-April shock without destabilizing, spillover effects for 2020 will amplify, but hardly threatening.The Bank of Russia has published the April data on the state of the financial system in the Bulletin “the Liquidity of the banking sector and financial markets”. In the document, the Central Bank confirmed the figures for the main event of April 2020 for this sector — almost instant reduction of structural surplus liquidity in the banks from the level of 2.3 trillion roubles (taking into account average reserves of 3.1 trillion RUB) 1.4 trillion (2 trillion rubles), however, the explanation by the regulator on the nature of the events is quite calm: the April outflow of liquidity (it began in March) — a temporary phenomenon. In the document, the Bank of Russia changed the March forecast liquidity position at the end of December 2020: if earlier it was supposed that before the end of the year the level of structural liquidity surplus will decrease, though at a negligible figure of 0.1 trillion rubles., now the lower level of the restored prediction: Explanations of the Central Bank events look like. The decrease in the surplus provided mainly by rising volume of cash in circulation, this process began in March, peaked in April, and weakened in may. Which, note, was not expected by majority of analysts have assumed that companies and households will require additional cash in the same amount as in April and may, and more. This budget system of the Russian Federation in April provided at the direction of the Central Bank costs fully expected volumes and on budget channel was formed by a small tributary of liquidity.The regions in virtue of the circumstances of the crisis did not increase, as is happening in recent years in the spring, deposits in the banking system, banks actively competed for the placed funds of the Department of Finance of Moscow. In turn, the Federal Treasury has supported liquidity in April deposits by 0.4 trillion Additional reasons to reduce the level of liquidity in the system was the state of Bank portfolios in loans to legal entities: it could not in a situation of economic restrictions in the epidemic and at the beginning of the fall in the price of bonds and currency revaluation do not deteriorate. But the scale of this was offset regulatory oslablenthe third Bank of Russia, in the end, the required reserves at the CBR increased by 0.25 trillion to 2.65 trillion under the risks of outflow of customer funds banks create a pool of liquidity on correspondent accounts in the Central Bank, which at the beginning of may reached 3 trillion, the Bank of Russia noted the stabilization in the market OFZ and Eurodollar of the Russian Federation in April, which allowed the Ministry of Finance one of the April auction by almost half to close the program borrowings for the second quarter of 2020. Central Bank thus observes a reduction in the savings activity of the population, but it is unequally distributed, individuals actively reduced the volume of foreign currency deposits (this process was active in March and less active in April 2020) and slightly increased the volume of ruble deposits.The Bank of Russia in this case will have a significant tightening of credit conditions, including price, for all categories of borrowers in the second and third quarters. In General, secondary effects of the events of April—may 2020 in the financial market it is difficult to predict: they depend in particular from the risk of bankruptcies and defaults to a greater extent corporate clients and, thus, largely on the efficiency of state support of the economy, including enterprises associated with the public sector and dependent on budgetary payments. Note, this is largely seen as the cause of the very quiescent state of finrynkov with the strongest shocks March—may 2020: banks (mainly state) and clients-legal entities (also to a very large extent dependent on the state) focused on government spending and to a lesser extent on the state of households (there is no precise data on the reduction of real disposable incomes in April 2020, most rough estimates are in the range of 5-15%, however, data is scarce). And the stability of the budgetary sphere is largely determined by the mechanism of “fiscal rules” and the presence of the NWF: the current stability is a combination of a certain rigidity of the state economy and well-managed budget.So, this week, the Central Bank has published data to indicate the condition of non-payments exactly on Finance,— in the Bulletin “Current risks to external and domestic financial market” presents data on the number of outstanding transactions on the OTC market. They amaze: the total number of outstanding transactions increased in comparison with the beginning of the year and amounted to 6 billion rubles, which allows you to completely ignore their impact on the state of the system. Secondary effects can actually be more significant — but their appearance is less likely to provoke unanticipated shocks, rather the financial system waiting in the coming months, a slow deterioration of the situation in case of slow economic recovery or stability in the relative��on fast.Dmitry Butrin