Russia: "We will have one big state; our entire economy will be under the control of the state,"

Russian Bank Chair: 'The Entire Economy Will Be Under Control Of The State'

by ELENA HOLODNY

The chairman of one of Russia's biggest state-owned banks said that if the authorities don't take control of the situation, the economy will continue to nationalize.

"We will have one big state; our entire economy will be under the control of the state," Sberbank's chairman and president German Gref said at the Gaidar Forum, according to Interfax.

He said lenders' property would go to the banks, the state would capitalize the banks, and then the banks would purchase enterprises, turning into "finance industry" groups.

Additionally, Gref said it was "obvious that the banking crisis will be enormous," citing the current average oil prices.

Sberbank's chairman isn't the first banker to seem worried about the industry. In mid-December, one banker declared it was "the end of the banking system" after the central bank raised rates to 17% in an effort to limit the ruble's devaluation and inflation risks.

And in late December, Russia announced it would be bailing out its first bank of the crisis, Trust Bank.

The rubles 40% plunge against the dollar in 2014 has been primarily attributed to the declining oil prices. Currently, the ruble is trading around 66 to the dollar.

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