VTB carries on negotiations for the purchase of Marfin Bank

01.03.2012 The second-large bank of the Russian Federation, VTB, doesn't confirm the information which has appeared in mass-media on the intention to enter into the capital Cyprian Marfin Popular Bank as the strategic investor.

On Tuesday the Cyprian newspaper Politis without any source informed that VTB considers the possibility of strategic participation in Marfin Laiki Popular Bank which has just reported about the largest losses in its history and needs the attraction of additional means.

According to this edition, negotiations between banks were at high level on which the state regulators of both countries have been informed. The large auditor firm, which name isn't specified, already checks Cyprian bank reporting, studying transaction possibility.

The newspaper specified, that the transaction concerning the purchase of a strategic package in Laiki can be carried out through Cyprian "offspring" VTB — Russian Commercial Bank

Marfin Popular Bank is the second-large bank in Cyprus. The bank also carries out the activity in the territory of Greece, Ukraine, Romania, Serbia, Great Britain. In Russia the Cyprian bank posesses Rosprombank which is one of third hundred banks of the country.

Expert’s opinion

«The second largest bank of the Russian Federation, after Sberbank, paid the attention to foreign banks with a wide retail chain.

The Sberbank has already carried out the purchase of bank which showed losses following the results of a year.

Now VTB is going to purchase Marfin Popular Bank which has the loss at a rate of 2,5 billions euro in 2011.

Euro area crisis as a whole reduces the cost of European banks. And after the write-off of 60 % from face value of Greek bonds Marfin Popular Bank certainly too considerably becomes cheaper. But news about the purchase of the Cyprian bank by the large investor, should fuel the market and quotations of Marfin Popular Bank.

VTB press service denies negotiations with Cypriotes about purchase.

There are two ways of this situation: the first way is that Russians want to buy Cypriotes and to it’s now harmfully for them any transaction mention which will raise bank cost. Or maybe Cypriotes, by hearing distribution about the investor, want to improve their position.

Time will show, which game we now observe.»

On the basis: http://www.politis-news.com/

Lomakin Yaroslav ( managing partner of Honest & Bright)