Russia central bank says stress tests to be used for regulatory purposes

By Oksana Kobzeva and Elena Fabrichnaya ST PETERSBURG, Russia (Reuters) - The head of Russia's central bank said on Thursday stress tests on Russian banks would be used for regulatory purposes and warned a cleanup of the banking sector was not yet over. Elvira Nabiullina also told a banking conference in St Petersburg the central bank would create a special fund for the financial rehabilitation of problem lenders and said the fund would speed up consolidation of the banking system. Up until now, the Russian central bank's stress tests have only been used for monitoring purposes. Nabiullina is credited with steering Russia through an economic crisis by keeping monetary policy tight and taking a tough stance on weak banks. On Thursday she promised a "radical" rethink of regulation of Russian banks and chided some banks for offloading non-performing loans on their balance sheets onto banks whose bailouts they are overseeing. ($1 = 64.1219 roubles) (Additional reporting by Darya Korsunskaya; Writing by Alexander Winning; editing by Katya Golubkova)