Russian bank bans early deposits withdrawal-paper

MOSCOW Oct 15 (Reuters) - Russian mid-sized bank Globex has temporarily frozen early withdrawals of fixed-term retail deposits as it tries to conserve cash amid a liquidity squeeze, Kommersant business daily reported on Wednesday.

The bank declined immediate comment on the report which quoted Globex's vice-president Emil Aliyev.

Aliyev said the bank's move was due to "an intense demand among depositors, many of which explain their moves by a desire to urgently transfer money to (Russian largest, state-controlled banks) VTB (VTBR.MM) and Sberbank (SBER03.MM)".

Many of Russia's banks are struggling with a liquidity shortage and inability to refinance debts because of the closure of global capital markets.

The crisis has already forced the government to bail out two mid-sized banks, Svyaz Bank and Kit-Finance, as painful memories of savings losses in the 1990s and the Soviet times are still fresh in people's minds.

Aliyev said Globex has already lost 15 percent of retail client savings or 3.5 billion roubles ($134.2 million) since Oct. 1 with the bulk of money withdrawn early.

Last week, Russia's mid-sized bank Rosevrobank asked clients to pay back their mortgages right away rather than risk the prospect of real estate prices falling 30 percent. ID:nLA112942]

(Reporting by Dmitry Sergeyev; Writing by Dmitry Zhdannikov; Editing by Erica Billingham)