PRESS: Promsvyazbank returns 100 bln rbl to cbank in March

MOSCOW, Apr 27 (PRIME) -- Russia’s Promsvyazbank returned 100 billion rubles of liquidity to the central bank and will repay the rest of the injections during 2018, Pyotr Fradkov, who was appointed head of the bank’s interim administration on Tuesday, said in an interview with Kommersant business daily on Friday.

“The central bank has made a significant injection, 330 billion rubles, to bail out (Promsvyazbank). By the way, we have started to repay the money early. In March, we repaid 100 billion rubles. The rest will be returned during 2018,” he said.

Earlier in April, Central Bank Deputy Chairman Vasily Pozdyshev said that 230 billion rubles had been provided at an interest rate of 0.5% annually and the rest of the sum at the central bank’s interest rate.

Promsvyazbank has been undergoing a bailout through the Banking Sector Consolidation Fund since mid-December 2017.

Fradkov also said that the bank is considering various scenarios in case it is included in a sanctions list and is sure its clients will not be hurt anyway.

“We do not rule out (sanctions against the bank) so we explore different scenarios. Safety of all our clients with no exceptions is the top priority for us,” he said, adding that some restrictions linked to foreign currency transactions or international payment systems are possible is case of sanctions.

“We warn our clients in advance that there are such risks, but we will compensate for them,” he also said.

Fradkov is sure that Russian banks should transfer their assets linked to the state defense order and corresponding capitals to Promsvyazbank as soon as possible.

“In my opinion, the banks should transfer loan portfolios of borrowers from specific industries together with the capital as soon as possible to mitigate the risk to be included in the Specially Designated Nationals (SDN) list,” he said.

He added that such transfer could help a number of banks to leave the sanctions list.

Mechanisms of the transfer are still being discussed with the Finance Ministry and the central bank, and the sum of such transfers will amount to 600–700 billion rubles although the sum is not precise.

In January, the Finance Ministry said that the government would create a bank based on Promsvyazbank to handle defense order contracts in the conditions of Western sanctions.

(62.6027 rubles – U.S. $1)

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