The highly respected head of the Russian Central Bank, Elvira Nabiullina, tried to resign after Vladimir Putin ordered the invasion of Ukraine, only for the president to I told him to stayaccording to four people with knowledge of the discussions.
Nominated for a new five-year term last week, Nabiullina’s current views were not known. She must handle the consequences of a war that quickly undid much of what he accomplished in the nine years since he took office.
His exit, now, would be interpreted by Putin like a betrayal. The two have been working together for almost two decades.
Russian President Vladimir Putin. Photo: Reuters
Nabiullina, 58, has not commented publicly on her re-election and did not respond to a query for this article. Spokesmen for the central bank and the Kremlin did not respond to requests for comment.
Only one top official has resigned over the war: economic reformer Anatoly Chubais resigned this week as Putin’s climate envoy and left the country, according to people familiar with the situation.
Nabiullina, favored by investors and hailed by publications such as Euromoney and The Banker as one of the best monetary policy makers of the world, now faces a wartime economy isolated by international sanctions and starved for investment as foreign companies leave.
With the ruble sinking as the US and its allies imposed extensive sanctions, including on the Central Bank itself, in the wake of the February 24 invasion, more than doubled the interest rate key and imposed capital controls to contain the outflow of money cash.
A poster mocks Vladimir Putin in Lviv. Photo: AP
The central bank said it has given up interventions to defend the ruble after international restrictions froze more than half of its $643 billion in reserves.
“As long as there is an escalation, the central bank can only adapt to shocks,” said Oleg Vyugin, a former senior Bank of Russia official who has known Nabiullina for more than 20 years.
Some bank officials describe a state of hopelessness in the weeks after the invasion, feeling trapped in an institution they fear will have little use for their market-oriented skills and experience, as Russia is isolated from the world.
At one point, the pace of the games was intense enough that the IT department ran out of hands to write off the accounts.
Other departments dug in under a heavier-than-usual workload and even saw a barrage of résumés pouring in from sanctioned banks.
Before the invasion, officials modeled scenarios that included a possible outage of the financial messaging service SWIFT, but considered the prospect of central bank reserve sanctions too extreme to be real, people familiar with the situation said.
Putin said earlier this month that he is confident that Russia will overcome the current economic difficulties and will emerge more independent. Comparing the current wave of restrictions with those imposed on the USSR during the Cold War, he said, “The Soviet Union lived under sanctions, developed and achieved colossal successes.”