Russia's Otkritie Bank aiming for IPO in 2022 with state firms, ex-owners to be barred

Credit: REUTERS/MAXIM SHEMETOV

Russia's Otkritie Bank, which was bailed out by the central bank four years ago, has cleaned up the toxic assets on its balance sheet and is on track for an initial public offering in May 2022, the bank's president Mikhail Zadornov told Reuters.

By Tatiana Voronova and Katya Golubkova

MOSCOW, April 7 (Reuters) - Russia's Otkritie Bank, which was bailed out by the central bank four years ago, has cleaned up the toxic assets on its balance sheet and is on track for an initial public offering in May 2022, the bank's president Mikhail Zadornov told Reuters.

Otkritie, the biggest of three private banking groups bailed out in 2017, may also consider a sale to a strategic investor, he said, but state firms and former owners won't be allowed to take part in either an IPO or a sale.

"State banks and state companies should not participate - this is a clear stance of the central bank and the government. The same concerns ex-shareholders of Otkritie and B&N bank," Zadornov said.

The sale of Otkritie would mark an end of the central bank's dual role as both regulator and owner of banks, a position which drew open criticism from other banking sector players. It sold its controlling stake in Russia's top bank Sberbank SBER.MM to the government last year.

Otkritie has cleaned up toxic assets from pre-bailout times ahead of the sale, with only non-core assets, such as a 5.7% stake in Russia's No.2 bank VTB VTBR.MM, left, Zadornov said.

Another 9% stake in VTB was transferred to Trust Bank last year and is due to be sold in 2021. Otkritie would then follow with the sale of its own 5.7% stake in VTB, he said, declining to give specific time frame.

Trust had planned to sell its 9% stake in VTB last month and has hired investment banks for the deal, sources told Reuters earlier.

"We will be looking for 'windows' as all sanctions talks are seriously affecting the market," Zadornov said.

Russian banks were hard hit by western sanctions on Moscow over its role in the Ukraine crisis in 2014 and expectations that Washington will soon impose new curbs has rattled Russian markets.

Asked about reported interest from Italy's top insurer Generali GASI.MI in an acquisition in Russia, Zadornov said that Otkritie has no plans to sell its insurance unit Rosgosstrakh before the bank's IPO next year.

And as retail loans are performing better-than-expected, Otkritie plans to release a "significant part" of 20 billion roubles ($257 million) in non-performing loan provisions set aside in the second quarter of 2020, Zadornov said.

"There was a fall in incomes (last year amid pandemic) but as people were cut off from their usual lifestyle, travelling - traditional source of spending - they actually accumulated more money in their pockets," he said of retail loans performance.

($1 = 77.7300 roubles)

(Reporting by Tatiana Voronova and Katya Golubkova Editing by Toby Chopra)

((ekaterina.golubkova@thomsonreuters.com; +7 495 775 1242;))

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