Russia might reduce stakes in state banks with new share issues - paper
MOSCOW. July 19 (Interfax) - The Russian government is now considering reducing its stakes in state banks by carrying out new share issues, while before it only considered selling part of these stakes, Kommersant reported on Thursday, citing sources at government agencies.
The government would not buy into these new share issues.
This alternative option for privatization of state banks was tabled by the Central Bank, the paper's sources said. The option is being discussed, but a final decision has not been made yet.
Central Bank first deputy chairman Alexei Ulyukayev does not rule out the possibility of carrying out new share issues by state banks instead of selling existing state shares as part of privatization.
"We have plans for the privatization of Sberbank and VTB. But is the actual sale of these assets, their fiscalization, needed? It's possible to go another route - in the interests of the companies carry out a secondary placement of shares, get money into the company," Ulyukayev said in an interview with Izvestia published on Thursday.
If the principal shareholder - the Central Bank in Sberbank's case and the government in the case of VTB - does not exercise the right to buy the new shares, its stake automatically decreases, he said.
"We still get privatization as an increase in the stake of private owners, just a little more slowly. On the other hand, the banks get funds in their capital, and they will be able to grow their loan portfolio for years into the future," Ulyukayev said.
"This is technically a rejection of privatization. Substantively, it's the same thing, only with a better result for the capital of banks. If we raise 200 billion rubles for the capital of Sberbank, and the CBR does not take its due share, then our stake will automatically decrease by more than 5%," Ulyukayev said.
Analysts said such an approach has both pluses and minuses. On one hand, banks will get additional capital, which means an opportunity to grow their businesses, but on the other the government would lose privatization revenues.
Analysts believe the government is discussing this option not only because of the growth of state banks, but also in light of the possibility of an economic crisis.
So far, the only state bank that has seen partial privatization since the 2008-2009 crisis is VTB , 10% of shares in which were sold on the open market at the beginning of 2011 for 95.7 billion rubles.
The government's approved privatization plan calls for reducing the Central Bank's stake in Sberbank by 7.58% of shares to 50% plus one share by the end of 2012. There are also plans to reduce the government's stake in VTB by 25.5% of shares by the end of 2013. The privatization of Rosselkhozbank is planned further down the line, by 2015.