Russia’s troubled Otkritie bank needs more central bank funding: CEO

FILE PHOTO: A man walks past the logo of Russian bank Otkritie in Moscow, Russia August 30, 2017. Photo: REUTERS/Sergei Karpukhin

The Bank of Russia will need to inject extra capital into Otkritie Bank’s business on top of the $8 billion already provided in a rescue package to the lender last year, said Otkritie’s new Chief Executive Officer Mikhail Zadornov.

Russia’s banking sector is in the spotlight after the central bank rescued three of the country’s biggest private banks, including Otkritie, in the second half of 2017. The regulator has also shuttered dozens of smaller lenders as part of a banking sector clean-up drive.

FILE PHOTO: A man walks past the logo of Russian bank Otkritie in Moscow, Russia August 30, 2017. Photo: REUTERS/Sergei Karpukhin

Zadornov said in an interview with Reuters that Trust Bank, owned by Otkritie, and B&N Bank, which is merging with Otkritie, are expected to receive more bail-out money from the central bank’s Banking Sector Consolidation Fund by the end of the first quarter.

Zadornov said that Otkritie’s 2018 business plan, approved by its supervisory board, envisages a 70 percent increase in retail lending, both in cash and mortgages, and more loans to small- and medium-sized enterprises.

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