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extended in the context of the preparations of BMM for privatisation, which was agreed between the government of Belarus and the EBRD in 2016.
The financial sector remains a contingency liability to the government
and a potential risk for macroeconomic stability, despite some improvements. Regulatory NPLs (the three riskiest categories) have stabilised, reaching 12.8% of gross credit exposure in 3Q17 due to the improved macroeconomic backdrop leading to lower interest rates and lower exchange rate volatility.
Capitalisation levels have improved somewhat, but remain modest given high credit risks. The large presence of the public sector (65% of assets) creates fiscal risks for the sovereign due to the potential need of further capital injections, execution of guarantees and issuance of securities in exchange of loan transfers.
8.2 Central Bank policy rate
The National Bank of Belarus (NBB) intends to cut its benchmark interest rate to 14-16% by the end of 2017 , its deputy chairman Sergei Kalechit said on October 4.
8.4 International ratings
BELARUS - Rating agency
as of Jan 2018
Bond rating: Moody’s
Caa1(S)
Bond rating: Fitch
B (S)
Bond rating: S&P
B (S)
20 BELARUS Country Report June 2018 www.intellinews.com