Financial Times FT.com

Exodus of capital hits Russia lending

By Catherine Belton in Moscow

Published: September 10 2008 03:00 | Last updated: September 10 2008 03:00

An exodus of foreign capital is forcing Russian banks to slash lending as the international reaction to the country's military stand-off with Georgia starts to affect the real economy.

Bankers say Russia is facing its worst crisis since the August 1998 default. The Russian stock market has plummeted more than 40 per cent since May.

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