The head of VTB, the second largest Russian bank by assets, Andrei Kostin doubts the feasibility of selling blocks of shares in FC Otkritie and B&N Bank during the IPO and considers it best to transfer them to the Russian government in this case.
Earlier, the head of the Bank of Russia Elvira Nabiullina said that the regulator is likely to conduct a public offering of shares of FC Otkritie and B&N Bank after their financial recovery, but this requires discussion.
“I think that the Central Bank will consolidate these banks, merge into one … It seems to me that this idea of an IPO is as wonderful as it is unrealizable. I would pass it on to the government as a last resort. This, at least, will eliminate the conflict of interests,” – said Kostin on the air of the TV channel “Russia 24”.
“I doubt very much that it is possible to sell a controlling stake through an IPO in the current situation. Today there are not so many people willing to invest real money in banks, so in this situation, if they fail to sell, then it is better to transfer it to the government,” the head of VTB said.
He noted that the reorganization scheme through the Banking Sector Consolidation Fund is effective, but the Central Bank should not own commercial banks, this will cause a direct conflict of interest.
FC Otkritie and B&N Bank, which are in the top 12 in Russia in terms of assets, are undergoing financial rehabilitation through the Central Bank-controlled Banking Sector Consolidation Fund. The Central Bank announced the reorganization of Otkrytie on August 29, and that of Binbank on September 21. Under the new reorganization mechanism, the Bank of Russia becomes the main owner of the rehabilitated banks with subsequent sale to a private investor.