European Bank for Reconstruction and Development

Russia's central bank said Tuesday that its most recent stress tests show the country's banks would remain "sufficiently stable," even if the economy were to contract 5% this year.The bank said it tested how banks would perform under a far more severe set of economic conditions than last year, assuming a 5% fall in gross domestic product under its "extreme" test scenario, compared with a 1.2% drop a year ago.However, it said the chances of a such a sharp contraction occurring were "very low," given the stability of oil prices, the relatively positive global outlook and the growing importance of the domestic market for the traditionally export-driven Russian economy.The bank's "pessimistic" scenario envisages 1.2% growth in GDP this year, compared with 2% growth assumed in the same type of scenario in last year's tests.The pessimistic scenario for this year also assumes a 25% to 30% drop in oil and other commodities prices and in this way closely resembles the European Bank for Reconstr...

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