VTB, Otkritie, RNCB might be consolidated - paper
MOSCOW. April 29 (Interfax) - VTB head Andrei Kostin has proposed to Prime Minister Mikhail Mishustin to consolidate the state lender and two other banks - Federal Property Agency-controlled Crimean lender RNCB and Central Bank subsidiary Otkritie Bank - into one group, national daily Kommersant reported on Friday, citing sources.
President Vladimir Putin has already approved the idea, the paper said. He believes this will enable the banks to "save considerably on branches," as VTB's and Otkritie's often overlap, as well as save on staff expenses, and bring a "major federal player to Crimea," the paper said.
The consolidation of state financial assets around a strong player seems like an economically and politically sound decision, a government source cited by Kommersant said. This is expected to make it possible to optimize budget expenditures on the stabilization of the banking sector and simultaneously maintain a competitive market for financial services.
The paper's sources said that the proposal has already received support from the Central Bank. The Finance Ministry and Central Bank did not respond to questions, the paper said. VTB, Otkritie and RNCB declined to comment.
All three banks are subject to U.S., UK and EU sanctions.
The Central Bank had planned to sell shares in Otkritie this year and was studying various options for a deal with investment advisors, including an initial public offering and a sale to a strategic investor. But preparations for a sale were suspended after the start of Russia's military operation in Ukraine.