Director of Equity Financing, FINAM Investment Company, Moscow
In a previous Russia Blog post (Russia's Most Wanted: Experienced Investment Bankers), I wrote about more and more foreign banks coming to Russia and finding their own ways to enter the Russian banking system. Some of them pick the organic growth path of getting the licenses and starting from scratch. Other major foreign financial institutions prefer to acquire a Russian bank and build their business in this country from an existing foundation. Last week there were two news items regarding foreign banks' plans for mergers and acquisitions to enter Russia’s banking sector.
Last Tuesday Santander Central Hispano (NYSE ADR: STD) closed a deal to acquire Extrobank, a relatively small Russian bank that still ranks among the top 300 banks in the country by assets. The Spanish banking group initiated the deal last summer and Russian financial experts estimate that they paid between $40 and $50 million for 100% ownership. Extrobank is actively engaged in auto crediting programs that are generally viewed favorably by consumers. Retail and auto loans are one of the fastest growing drivers of the growth in consumer lending in this country.
Another development the press reported earlier last week is that UniCredito Italiano Group (BIT:UC) is speeding up its efforts to select another Russian banking candidate for an acquisition. The search is being conducted through Bank Austria Creditanstalt AG (WBAG:BACA) , a member of the UniCredito Group. Some analysts think that the Italians are looking for one of the Top-10 Russian banks as a good add-on to the existing 95% UCG owned International Moscow Bank (IMB). IMB is currently ranked among the top ten Russian banks by assets; and if acquired it is expected to change its name to Unicredit Bank.
Credit cards issued by Impexbank
On a less sunny note, last week it was reported that some major structural and personnel changes were happening at Impexbank. Not too long ago this Russian bank was acquired by Raiffeisen International Bank-Holding AG (WBAG:RIBH). Impexbank has reportedly lost several key managers, apparently as a result of internal disputes over the bank’s development strategy.
You can read the original post at Vladimir Kuznetsov's blog, Equity Financing in Russia. The views expressed in this post and on his blog are the personal opinions of Vladimir Kuznetsov, and are reproduced here solely for educational purposes. To read more Russia Blog posts about Russian capital markets, click on the finance section or type www.russiablog.org/finance in your web browser.
