Russia's Ministry of Economic Development has picked three domestic investment banks to run the government's renewed privatisation drive, it said on April 4.

The sale of state-held stakes in oil major Bashneft, diamond miner Alrosa, and state-controlled VTB bank will be organised by VTB Capital, Sberbank CIB, and Renaissance Broker, respectively.

The ministry has filed the candidatures of the investment banks to the government for further approval. Meanwhile, it is not clear whether the absence of a named bank for privatisation of Russian oil major Rosneft means that there is no decision on it yet, or that the company wants to organise the deal internally.

Rosneft was previously named as one of the top 3 candidates for privatisation by Economy Minister Alexei Ulyukayev, along with Bashneft and Alrosa, despite reports that the government is hesitant about selling shares in Russia's largest crude producer too cheaply.

The government is considering issuing convertible exchange bonds to privatise 19.5% in Rosneft, Vedomosti daily reported in March, citing unnamed federal officials.

According to earlier unconfirmed reports by Reuters, the ministry has forwarded an invitation to participate in privatisation to 22 domestic and foreign banks, while foreign banks were reluctant to participate due to the risk of potentially violating Western sanctions.

Similarly, many European banks opted out of participating in Russia's $3bn sovereign Eurobond issue as they are "unwilling to upset" the EU and US authorities, unnamed sources told the Wall Street Journal in March.

Market sources told bne IntelliNews last month that a number of European lenders had initially thought to step in to help the Kremlin arrange its first sovereign Eurobond since 2013 after the US Treasury warned Wall Street lenders to stay away.