Macroprudential policy efficiency in Russia: Assessment for the uncollateralized consumer loans

We use data regarding Russian banks during the 2015–2019 period to evaluate the effectiveness of the macroprudential measures in curbing the booming consumer lending segment. We find that the measures are successful in reducing overall loan portfolio riskiness and capital cushion accumulation by banks. In the short run of up to 1–2 quarters after the announcement date of a measure, banks tend to reduce both new loan volumes and the average consumer loan portfolio growth rate. Such reductions are more typical with the smallest market players. However, in the longer time horizon of up to one year from the application date of a measure, we observe an increase in average credit growth rates. Such findings correspond to the experience of emerging markets, such as Argentina, Colombia and Thailand. In general, we believe that the observed credit growth that occurs after measure implementation is less than it could have been without the measures in place. We also expect the observed lending growth rate to bring less financial instability risks and reflect the potential for natural loan extension in Russia. The novelty of this paper is in its distinction between macroprudential measurement scales when they produce intended and unintended consequences.