This from today's Wall St. Journal "Washington Wire"
Russia has been trying to get into the [WTO] for more than a decade, but the U.S. won't give its approval unless Moscow allows foreign banks, insurers and other financial institutions to open branches. Right now foreigners have to go through the more-onerous process of setting up local subsidiaries, with their own capitalization. The free-marketeers at the U.S. Treasury Department see financial services as the grease that would speed growth of the Russian economy. The Russians are worried that their regulators won't be able to adequately supervise branches and that domestic banks won't be able to compete with international institutions.
U.S. Treasury Secretary John Snow made no headway at a meeting in Moscow this morning with his Russian counterpart, Alexei Kudrin, in advance of tomorrow's gathering of Group of Eight finance ministers. The U.S. side has proposed a transitional period during which Russia would open its financial system to more foreign competition.
The U.S. has also been concerned about its ability to supervise branches of foreign banks, and does not permit branches of foreign banks to apply for U.S. deposit insurance.
