Putin invites foreign banks to invest in Russia lenders

17th September 2010, Comments 0 comments

Prime Minister Vladimir Putin said on Friday that Russia was ready to welcome foreign capital investments in Russia's banking sector.

"If solid financial institutions in the United States and Europe will invest in the capital of our key banking institutions, we have nothing against that," Russian news agencies quoted Putin as saying.

"We are considering this option and there is nothing unusual about it."

This week Russian finance minister Alexei Kudrin said Russia would seek to raise 50 billion dollars (38.5 billion euros) from privatisations over the next five years as it wants to sell stakes in some of its top companies, including the country's two biggest lenders Sberbank and VTB.

Russian officials have said the aim of the privatisation would be to make companies more efficient and to replenish state coffers, drained by the global economic crisis.

Russia's banking sector was badly hit by the crisis last year. The volume of bad loans made by banks rose sharply as the country's hydrocarbon-dependent economy suffered a 7.9-percent economic contraction last year.

Speaking to an investor forum in the Black Sea resort city of Sochi, Putin stressed that Russia had provided anti-crisis loans worth more than 2.0 trillion rubles (65.5 billion dollars) to support banks, without putting Russian lenders first.

"We did not divide banks into ours and foreign. Banks fully backed by foreign capital received the same support as our Russian banks," Putin was quoted as telling international participants at the forum.

After the chaotic asset sales of the 1990s created a class of super-rich oligarchs and a ferocious public backlash, the government had until recently preferred to increase rather than reduce its stakes in firms.

© 2010 AFP

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