MOSCOW, Dec 28 - Russian President Dmitry Medvedev on Monday urged banks to reduce the gap between their lending charges and official interest rates, as officials hope cheaper loans to the real economy may boost recovery from recession.

Russia's central bank has cut the benchmark refinancing rate 10 times this year, taking it down to a historic low of 8.75 percent effective from Monday. [ID:nLDE5BO01X] But banks -- faced with still rising bad loans -- remain in a cautious mood, reluctant to raise overall loan portfolio levels and offering cheap rates only to the best customers.

The situation is fairly difficult. There is a deficit of trust, Russian news agencies quoted Medvedev as saying.

Despite the fact that we have the lowest refinancing rate in history, loan rates remain very high. Our task is to slash this difference. In November, banks' lending rates to non-financial organisations averaged 13.6 percent, according to central bank data -- their lowest since September 2008 but still some 400 basis points higher than the 9.50 level at which the refi rate was for most of that month.

In comparison, the spread between banks' lending rates and the refi hovered around 100 basis points in the first half of 2008, before the financial crisis and global credit crunch hit. (Writing by Toni Vorobyova; editing by Chris Pizzey)