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UPDATE 1-Russian banks Promsvyazbank, Vozrozhdenie put merger plans on hold
October 27, 2017 / 3:56 PM / a month ago

UPDATE 1-Russian banks Promsvyazbank, Vozrozhdenie put merger plans on hold

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MOSCOW, Oct 27 (Reuters) - Russian banks Promsvyazbank and Vozrozhdenie have put their planned merger on hold but may come back to the idea next year, Promsvyazbank said on Friday.

Promsvyazbank (PSB), Russia’s 10th largest lender by assets, and much smaller rival Vozrozhdenie said in September that they planned to merge in October. The two banks have the same controlling shareholders.

Russia’s banking sector is under intense scrutiny after the central bank had to step in to save B&N Bank and Otkritie - two of the country’s biggest private lenders - in the past two months, but PSB and Vozrozhdenie are relatively healthy.

PSB, in its statement, said Vozrozhdenie and PSB were profitable and stable, with sufficient capital and liquidity and would continue to operate as two separate banks.

“We have postponed the banks’ merger and are considering turning Vozrozhdenie into a digital bank,” Dmitry Ananiev, who is both chairman of Promsvyazbank’s management board and chairman of Vozrozhdenie’s board of directors, told Reuters, without elaborating on why the merger was off for now.

The banks may look at the idea of a merger again next year, Ananiev added. (Reporting by Andrey Ostroukh and Katya Golubkova; Writing by Katya Golubkova and Polina Devitt; Editing by Susan Fenton)

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