MOSCOW, July 25. /TASS/. The State Duma, the lower house of the Russian parliament, has approved in the first reading the bill providing for an opportunity of foreign banks’ branches opening in Russia and anticipating a series of restrictions for their operations.

The document was initiated by the Russian government. The bill determines the procedure for accreditation of a foreign bank’s branch in Russia and licensing by the Central Bank for banking operations. It determines grounds for refusal to grant the license and sets forth requirements to be complied with by foreign banks when operating in Russia through their branches. The list of banking operations and transactions that can be made by the branch in Russia is determined.

There is also stipulated the ban on certain banking operations for branches of foreign banks. In particular, they are not entitled to banking and transacting with individuals, including those registered as sole entrepreneurs. an exception is made for transfer of funds without opening of bank accounts and foreign exchange sale and purchase in cash and cashless forms. In the latter case, buying and selling foreign exchange is allowed only for money transfers without opening of bank accounts. Branches are also banned from attracting retail and corporate deposits and opening accounts in precious metals.

Branches will not be able to open and maintain bank accounts for legal entities, transfer money under their orders, collect cash, bills, payment and settlement documents and provide cash services for legal entities. They will not be able to act as a guarantor for third parties, let on lease safe deposit vaults, performing leasing transactions and provide consulting and information services.

A foreign bank will be granted the right for professional activities in the securities market through the branch created in Russia under Russian laws. Only one branch can be opened by a foreign bank in the territory of Russia. The requirement is also set to establish a guarantee deposit for such branch, with its minimal amount of one billion rubles ($11.6 mln) to secure performance of liabilities under agreements made when carrying operations in Russia.