Director of Equity Financing, FINAM Investment Company, Moscow
In a post last month I mentioned that there are definite indications of interest from foreign banks looking for additional mergers and acquisitions here in Russia. It seems that July 2007 was a very active month for the Russian banking industry. On July 31, 2007, Vedomosti Daily published commentary regarding the acquisition of Russian and Ukrainian banks by foreign entities. The article was based on a study conducted by Dresdner Kleinwort showing that in Ukraine foreign entities own about 47% of national assets, while in Russia this number is just 10%. Here is a link to the table from the publication that represents the Russian side.
Click on the extended post to read more.
In other Russian banking news from last month, the British direct investment fund Aurora Russia has completed the second stage of purchasing a stake in Unistream Bank, a subsidiary of Unistream Bank that specializes in money wire transfers. During the first stage of the purchase in April 2007, Aurora Russia acquired a 17.7% stake in Unistream for $13.6 million. After receiving permission from the Central Bank of Russia to acquire more than 20% of the bank, the fund acquired another 8.3% interest in the bank for $6.3 million. Unistream Bank was Russia's 48th largest bank by assets at the end of the first quarter of 2007, according to the Interfax News Agency’s top 100 rankings.
Firebird Management LLC's Russia Investment fund acquired 10% of the small Russian bank Sotsgorbank through a Cyprus-based subsidiary. 10% of the company was sold for about $10 million. As of Q1 2007 Sotsgorbank was ranked in the 167th place by assets, according to the rankings compiled by RosBuisnessConsulting. Firebird Investment already owns equity in several other Russian regional banks: 8.7% of Center-Invest Bank, 10% of SDM-Bank and 10% of NBD-Bank.
In other Russian banking news, KBC Group (EBR:KBC) formally closed a deal to acquire more equity in Absolut Bank a few weeks ago, with the final stake adding up to 95% (after acquiring 7.5% from the World Bank's International Finance Corporation). Meanwhile, the IFC is buying an additional equity issue ($185 million) from MDM Bank.
Logo of the World Bank's International Finance Corporation (IFC)
On A Personal Note:
This is the 100th post since I started the blog Equity Financing in Russia in January 2007. I am currently in discussions with colleagues in the Russian financial industry to change the format of my blog and create more news coverage by a dedicated team. There will be a hiatus in posting, but I look to be back with a new format and product very soon.
Best regards,
Vladimir F. Kuznetsov
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.
