Russian investors reduced their holdings of foreign securities amidst sanctions and restricted access to overseas assets, according to a press release from the Bank of Russia published on the central bank’s site.
The data cover January through March 2022. During this quarter, the value of foreign issuer shares in the accounts of Russian traders declined from 920 billion rubles to 890 billion rubles, while deposit receipts fell from 390 billion to 276 billion rubles.
Conversely, the market value of foreign corporate and sovereign bonds in retail investor portfolios rose from 1.3 trillion rubles to 1.4 trillion rubles.
In 2021, there was a rise in private traders’ investments in foreign assets. Bank of Russia notes that this upturn was influenced, among other factors, by the launch of trading in foreign issuer shares and the rapid growth of domestic stock exchanges, including the Moscow Exchange and the St. Petersburg Stock Exchange.
From the start of March, European depository institutions Euroclear and Clearstream suspended services to Russian investors via the National Settlement Depot, part of the Moscow Exchange. This interruption created significant hurdles for Russians seeking access to and management of foreign assets, complicating portfolio actions.
At the beginning of June, the European Union placed NSD on the sanctions list as part of the sixth package, further affecting settlement and access to foreign markets (Bank of Russia cropping and sanctions guidance).