MOSCOW, Reuters – Russia is planning to tap its National Wealth Fund. This fund provides a cushion for the unexpected. Russia announced that it will spend as high as 1 trillion roubles ($9.34billion) on shares of Russian companies.

Moscow is facing severe economic sanctions by the United States and European Union, as well as their allies, after Russia invaded Ukraine last week.

Russia refers to its actions in Ukraine as a “special operations” and says it isn’t meant to occupy the territory. Its purpose is to destroy military capability of its neighbor, capture dangerous nationalists, and to disarm them.

A large portion of the central bank’s foreign and gold reserves were frozen by the sanctions. The largest banks in the country were also cut off from SWIFT, an international messaging network for banking and financial services.

Russia has $643 billion worth of forex assets, including those held by the NWF.

WHAT IS THE FUND SUMMARY?

A fiscal rule was adopted by the NWF in 2017. It allows Russia to buy foreign currency at high oil prices and then sell it when they drop below $44/barrel. This protects the rouble against oil price swings.

According to the finance ministry, the fund held 13.6 trillion rubles, which is 10.2% of 2022’s gross domestic product, or $174.9 million, at February 1, 2012.

Is ALL THE SWF’S ASSETS AVAILABLE?

According to the ministry, $112.7billion was the liquid component of this fund or the assets of the central bank. That’s 8.8 trillion Russian roubles or 6.6% of projected GDP for 2012 as of February 1.

Cash is held by the central bank:

– 38.6 billion euros;

– 4.2 billion British pounds;

600.3 billion Japanese Yuan

– 226.6 billion

– 405.8 tons of gold equivalent in cash

– 266 millions roubles

WHAT ARE THE RESULTS OF NWF INVESTMENTS INTO NONLIQUID ASSETS

The ministry stated that deposits in the VEB state development bank VEB amounted to 530.6 billion rubles as of February 1, 2009.

International debt instruments worth $3 billion

Russian bonds linked to infrastructure large projects are worth $4.1 billion and 294.8 billion rubles.

Preferential shares worth 279 billion rubles at various banks

– Subordinated deposits of VTB, Gazprombank and linked to large infrastructure project;

Sberbank shares worth 3 trillion rubles

Aeroflot shares worth 47.4 billion Rubles

($1 = 107.1000 roubles)