Returning the icon, murder of the American journalist and also banks problems are the latest developments:

Pope to hand icon back to Russia

By David Willey
BBC correspondent in Rome



The icon has hung in the Vatican for three decades
Pope John Paul II has decided to return to Russia a revered icon painting from his private apartments at the Vatican.
The Pope says he is making the gesture as a gift to the Russian people.


He had hoped to return the painting - a copy of a famous Russian icon of the Virgin and child dating back about 300 years - to Russia in person.

But the leader of the Russian Orthodox Church made it clear the Pope would not be welcome because of persisting tension between the two churches.

John Paul, who is holidaying in the Italian Alps, has evidently been pondering the current poor state of relations between the Vatican and the Russian Orthodox Church.

Gesture of friendship

The Russian Church belongs to the Eastern branch of Christianity which separated from the Western branch - then centred in Rome - a thousand years ago.

Last month however, the Pope made a gesture of friendship towards the Orthodox by inviting to Rome Patriarch Bartholomew, the head of all the Eastern Churches.

The 84-year-old pontiff would like to be remembered as the pope that finally ended the millennial rift between the two branches of Christianity.

This icon, which he has personally revered in Rome for two decades, is a powerful symbol for Russian believers.

The painting will be carried to Russia by a Vatican delegation next month.

But a papal visit to Moscow still remains highly unlikely.

U.S. Journalist Klebnikov Murdered in Russia

Weekend Edition - Saturday audio

July 10, 2004

American journalist Paul Klebnikov dies in Russia after being gunned down outside his office Friday. He was the editor of the new Russian edition of Forbes magazine, which recently published a controversial list of the nation's wealthiest people. He had also written extensively about Russia's oligarchs. Hear NPR's Susan Stamberg and NPR's Lawrence Sheets.

http://www.npr.org/features/feature.php?wfId=3269021

Does Putin and Kremlin wants to keep a firm control over Russia's banks just like it is trying to "nationalize" the petroleum industry?

Desperation sends tremor through Russia banks
Associated Press
MOSCOW -- A state-owned Russian bank on Friday agreed to buy the vast majority of shares in Guta Bank, which sent a tremor through the Russian banking industry when it closed its doors this week after running short on cash.

Russia's smaller banks have been suffering liquidity troubles for weeks, but Guta Bank's decision on Tuesday raised fears of the problem spreading to the top end of the banking sector. Guta Bank is one of Russia's top 20 banks.

Later in the week, long lines formed at another of the country's biggest financial institutions, Alfa Bank, and the bank imposed a 10 percent fee on withdrawals.

In response to the looming crisis, the Central Bank cut its mandatory reserve requirement in half, to 3.5 percent, in order to free up cash.

The announcement that state-owned Vneshtorgbank would buy 86 percent of Guta Bank's shares was expected to allow Guta to resume full operations within a week, the banks said in a joint statement.

Alfa Bank said it expects stabilization of its situation by Monday, following three days in which customers made withdrawals equivalent to $200 million, Dow Jones Newswires reported.

The banking sector's recent troubles began in May when the Central Bank revoked the license of medium-sized Sodbiznesbank because it was allegedly laundering money, including payments made in connection with a mafia-style assassination. Sodbiznesbank has denied the charges.

It was the first time the Central Bank had pulled a license before a bank had actually defaulted on a loan, and it spurred fears that a purge of the banking sector was in the cards.