TULA, Russia Jan 24 Some foreign banks may be
preparing to exit Russia because of low profitability, though
Asian banks are actively looking at the market, a senior central
bank official said on Thursday.
Deputy Chairman Mikhail Sukhov said that out of 48 banks in
Russia that reported losses last year, 13 were foreign-owned.
"Probably they are waiting," he told a briefing. "Not all of
them have plans for sale, but negative financial results are an
additional factor for banks controlled by foreign capital."
In recent years several foreign banks have exited Russia or
scaled back their presence in response to tough competition from
large state-backed banks led by Sberbank and VTB
as they struggle on their home markets.
Britain's Barclays and HSBC and Spain's
Santander divested their Russian retail operations,
while Belgium's KBC has agreed to sell its Russian
subsidiary to local buyers.
Sukhov said it was understandable that some foreign banks
were scaling back plans to expand in emerging markets such as
Russia because of tighter regulations at home that were forcing
a more conservative attitude to risk.
However, he said that the 13 loss-makers were a minority of
the 100-plus foreign-owned banks in Russia.
He also said that the foreign banks in Russia were becoming
more geographically diverse, with Asian banks in particular
poised to enter the Russian market.
Late last year Japanese financial company Sawada Holdings
acquired a 40-percent stake in Russia's Solid Bank to
develop retail banking in Russia's Far East.
"We will see several new entrants in the near future... This
year there will be several banks not of European or American
origin," said Sukhov, who is director of the credit licensing
and financial rehabilitation department at the central bank.