ACRA: State ownership in Russian banking sector rises to 70%
MOSCOW, Feb 13 (PRIME) Ц The governmentТs holding in Russian banks rose to 70% in 2017 from 61% as of the beginning of 2016, Kirill Lukashuk, head of the financial institutions group of the Analytical Credit Rating Agency (ACRA), said on Tuesday during a joint news conference with the Moscow Exchange.
There are no private banks among RussiaТs top five banks, and only three private banks, including a subsidiary of a foreign bank, among RussiaТs top 10 banks, he said.
УWe see risks of delays in privatization of institutions that are bailed out. We are yet to see a precedent of a complete privatization of a financial institution in the Russian financial sector. No one has done it in Russia yet, it is a very difficult task and it is likely to be solved within the sanction field and in conditions of a rather weak economy. We see no real prerequisites for it to happen fast,Ф he said.
Return to industry-targeted banks, like Promsvyazbank that is to become a bank for the defense industry, is also alarming from the point of view of competition, he said.
Other risk factors include inefficient state management of investment; liberal oversight practices; provision of loans on orders from government; development of politically important industries; a Уstate within a stateФ practice when state companies may place funds only with state banks; and a high level of contingent liabilities of the state for provision of support to the financial system, he said.