Russia's Sberbank to sell more shares Tuesday

By bne IntelliNews September 17, 2012

bne -

As bne reported two weeks ago, Russia's biggest bank, the state-owned Sberbank, will carry out a secondary share offering (SPO) on September 18. Offering 7.6% of global depositary receipts (GDR) in a dual listing in London and Moscow, the bank hopes to raise RUB149bn ($4.9bn) in what will be by far the largest Russian equity offering in years, while re-launching the Kremlin's stalled privatisation programme at the same time.

The bank is hoping to make use of a window of opportunity that has opened up for Russian issuers to get long-delayed share issue plans off the ground. Leading health services company MC Medical group announced September 17 an IPO in London this October, hoping to raise $150m.

The investment sentiment pendulum is clearly swinging back in Russia's direction, driven by the combination of a slowdown in China and a new round of quantitative easing (QE) in Europe and the US.

The SPO is good news and should lift the mood considerably. There is a lot of new money floating about thanks to the new round of QE and Russia's economy remains one of the bright spots in Europe. Moreover, the Kremlin is making a concerted effort to continue reforms, albeit in a limited way, that will convince more people to at least look at Russia again.

Sberbank will start a round of meetings with potential investors after the Central Bank of Russia formally announced the start of the sale on September 17.

The bank will offer shares in the range of RUB91 a share and the market price at the time that the book for orders closes, according newswires. Sberbank shares have risen as rumours of the sale have gathered momentum in the last few weeks. The shares closed up 4.6% ay RUB96.99 at the close of Moscow's Micex on September 14. The shares last traded at RUB97.05 on Micex.

"The offerings represent an opportunity for us to further diversify Sberbank's investor base and secure an international stock exchange listing. We view this as a critical step in our broader plan to reinforce Sberbank's position as the leading Russian financial institution, and transform it into one of the world's top performing banks in terms of profitability, operational efficiency and service quality," German Gref, president of Sberbank, said. "With a strong balance sheet and significant scale, Sberbank is well positioned to maintain its solid market share in Russia and to capture additional growth opportunities in Russia and beyond."

Alfa Bank said the offering will include 1.7bn existing shares of Sberbank, which is equivalent to 7.6% of total share capital, and 7.9% of ordinary shares. The offering will reduce the Central Bank of Russia (CBR) stake to 50% of total share capital plus one share. According to the announcement, the ordinary shares to be sold via Micex will comprise up to 10% of the total offering, subject to being increased up to 15% at the discretion of the CBR. "We believe that the CBR's offering is well timed, both because of market strength and because of expected pressure on sector and Sberbank profitability. We expect the price of the shares to fall in the near term due to the offering. We also expect negative near-term impact for shares of other EM banks as well as listings of Russian companies in other sectors."

Renaissance Capital added in a note: "While we may see some minor weakness initially, we strongly believe that by removing the overhang, the stock is due to see a re-rating. We have the broader view that the Sberbank placement should not only help Sberbank to re-rate, but will support a wider Russia market refocus and re-rating story."

Related Articles

Drum rolls in the great disappearing act of Russia's banks

Jason Corcoran in Moscow - Russian banks are disappearing at the fastest rate ever as the country's deepening recession makes it easier for the central bank to expose money laundering, dodgy lending ... more

Kremlin: No evidence in Olympic doping allegations against Russia

bne IntelliNews - The Kremlin supported by national sports authorities has brushed aside "groundless" allegations of a mass doping scam involving Russian athletes after the World Anti-Doping Agency ... more

PROFILE: Day of reckoning comes for eccentric owner of Russian bank Uralsib

Jason Corcoran in Moscow - Revelations and mysticism may have been the stock-in-trade of Nikolai Tsvetkov’s management style, but ultimately they didn’t help him to hold on to his ... more

Register here to continue reading this article and 2 more for free or 12 months full access inc. Magazine and Weekly Newspaper for just $119/year.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

IntelliNews Pro subscribers click here

Thank you. Please complete your registration by confirming your email address. A confirmation email has been sent to the email address you provided.

Thank you for purchasing a bne IntelliNews subscription. We look forward to serving you as one of our paid subscribers. An email confirmation will be sent to the email address you have provided.

To continue viewing our content you need to complete the registration process.

Please look for an email that was sent to with the subject line "Confirmation bne IntelliNews access". This email will have instructions on how to complete registration process. Please check in your "Junk" folder in case this communication was misdirected in your email system.

If you have any questions please contact us at

Subscribe to bne IntelliNews website and magazine

Subscribe to bne IntelliNews website and monthly magazine, the leading source of business, economic and financial news and commentary in emerging markets.

Your subscription includes:
  • Full access to the bne content daily news and features on the website
  • Newsletters direct to your mailbox
  • Print and digital subscription to the monthly bne magazine
  • Digital subscription to the weekly bne newspaper

IntelliNews Pro subscribers click here

bne IntelliNews
$119 per year

All prices are in US dollars net of applicable taxes.

If you have any questions please contact us at

Register for free to read bne IntelliNews Magazine. You'll receive a free digital subscription.

If you have already registered, enter the information below with the same email you used previously and you will be granted immediate access.

Thank you. Please complete your registration by confirming your email address. The confirmation email has been sent to the email address you provided.

IntelliNews Pro offers daily news updates delivered to your inbox and in-depth data reports.
Get the emerging markets newswire that financial professionals trust.

"No day starts for my team without IntelliNews Pro" — UBS

Thank-you for requesting an IntelliNews Pro trial. Our team will be in contact with you shortly.