January 27, 2015 / 9:16 AM / 5 years ago

UPDATE 1-Raiffeisen Bank denies talk of Russia exit, capital increase

* CEO denies “rumours” of talks to sell Russia unit

* CFO dismisses talk bank may need capital increase (Adds CFO comment, Raiffeisen confirmation)

VIENNA, Jan 27 (Reuters) - Raiffeisen Bank International has no desire to exit the Russian market, Chief Executive Karl Sevelda told a newspaper in response to market rumours it could sell its lucrative Russian business.

The Austrian lender has “absolutely no intention to sell our Russian bank”, he told Der Standard in a report printed on Tuesday. A bank spokeswoman confirmed his remarks.

He was responding to Russian media reports that Raiffeisen was in talks with Alfa Bank about a potential sale. Sevelda dismissed these “unfounded rumours” and said Raiffeisen had “absolutely no contact” with Alfa Group.

Raiffeisen, which is conducting a strategic review of its portfolio, said this month losses for 2014 could surpass 500 million euros ($561.5 million) if it had to write down goodwill in Russia, its single most profitable market.

The spokeswoman also confirmed the paper’s report that Chief Financial Officer Martin Gruell had denied market talk Raiffeisen may need to raise capital. It raised about 2.8 billion euros a year ago via a rights issue.

RBI shares, which have fallen a fifth this year amid investor concern about its exposure to Ukraine and Russia, rose 0.7 percent to 10 euros by 0902 GMT while the Stoxx bank sector index fell 0.9 percent. ($1 = 0.8906 euros) (Reporting by Michael Shields; editing by Edwina Gibbs and David Clarke)

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