“Russian investment banks controlled by the government of President Vladimir Putin are squeezing out foreign competitors, helped by a bailout of the country’s richest men five years ago.
OAO Sberbank (SBER), the nation’s biggest lender, and VTB Group have increased investment-banking fee income more than fivefold since 2005, according to data compiled by Freeman & Co., a New York-based consulting firm. European financial institutions including UBS AG (UBSN), Deutsche Bank AG (DBK) and Royal Bank of Scotland Group Plc (RBS) lost almost half their market share during the period.
With credit lines abroad frozen after the 2008 collapse of Lehman Brothers Holdings Inc., Russia’s state-run banks stepped in as Putin pledged $200 billion in loans and tax relief to bail out allies who owned strategic businesses. Among companies that received loans were aluminum producer United Co. Rusal (RUALR), controlled by billionaire Oleg Deripaska, and Evraz Plc (EVR), a steelmaker part-owned by Roman Abramovich. Sberbank and VTB then used their position to leverage follow-up business…”
If you enjoy the content at iBankCoin, please follow us on Twitter
