Borodin to keep small stake in Bank of Moscow - Kostin
MOSCOW. Oct 3 (Interfax) - VTB Group plans to increase its stake in Bank of Moscow from 80.75% to 100% in the next few months, VTB Bank President and Chairman Andrei Kostin said.
"We are thinking about the ways to buy from minority shareholders with small stakes. I think that an additional [Bank of Moscow] issue plus this purchase will virtually lead to the consolidation of a 100% packet of shares," Kostin said in an interview with the television channel Rossiya 24.
"This is going to happen quite fast, over the next few months," he said.
Former Bank of Moscow president Borodin remains the holder of a small stake and VTB is not planning to buy this, Kostin said. "Naturally, we are not planning to buy shares from Mr. Borodin or his associates (...) We believe that there is still such a small stake," he said.
The banker said VTB plans to spend up to 258 billion rubles to consolidate Bank of Moscow shares and rehabilitate the bank. This will include up to 100 billion rubles for bank capitalization, 93 billion rubles on the stake already purchased earlier in the year from Moscow government, and the purchase of the remaining shares. "By simple subtraction you can determine how much we plan to spend on buying shares in order to consolidate 100% of Bank of Moscow," Kostin said without saying how much was spent on buying shares from former Bank of Moscow shareholders Vitaly Yusufov and Suleiman Kerimov.
"We will spend a minimum on buying; the amount that we have paid cannot be disclosed under an agreement with clients. I can say that nobody that sold the shares made anything out of them," he said.
A support plan for Bank of Moscow, approved by the Central Bank of Russia and the Deposit Insurance Agency, envisages that after VTB consolidates at least 75% of Bank of Moscow, the Deposit Insurance Agency will provide the bank with a 295 billion ruble loan for 10 years at 0.51% pa.
Investing the money in government bonds should enable Bank of Moscow to achieve a positive financial result of around 150 billion rubles to International Financial Reporting Standards in 2011.
VTB consolidated a 80.57% stake in Bank of Moscow in September before the Deposit Insurance Agency loan was allocated.
VTB Pension Administrator is later expected to offer Bank of Moscow additional equity of around 100 billion rubles.
