UPDATE: Exec sees Sberbank unhurt by court decision in Transneft case

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MOSCOW, Jun 26 (PRIME) -- Russia’s top bank Sberbank will not be significantly hurt by the decision of the Moscow Arbitration Court siding with oil pipeline monopoly Transneft in a 66 billion ruble derivative case, Deputy CEO Bella Zlatkis said on Monday at a meeting of the Association of Russian Banks.

Earlier in June, the court voided a derivative deal between Transneft and Sberbank that was signed shortly before the ruble devaluation in 2014. The court obliged Transneft and Sberbank to refund all money spent under the deal mutually. Sberbank said earlier that it had received 66 billion rubles from Transneft.

Andrei Shemetov, head of the global markets department at Sberbank CIB, said later that combined losses of Russian banks due to the precedent in deals with derivative instruments set by the court may amount to 600 million rubles–1 trillion rubles.

“We will not go bankrupt, nothing bad will happen to Sberbank. What will happen with the market? We are looking right now how these (similar deals of other banks with derivatives) will be closed,” Zlatkis said.

“Everyone knows what may happen on the banking market after the case, this is much more worrying than 66 billion (rubles). Still, this is a large sum, and we will obviously fight for it.”

“This is not a difficult deal, it was described in our regulations. Frankly speaking, we didn’t even think too much about the court case as it was a simple and clear deal, we did not worry much…It was a standard deal with full disclosure of information on risks, it did not have a weak side. Moreover, Transneft signs hundreds of these deals, and we account only for about a third of them.”

She also said that Sberbank will appeal against the decision until July 21. “It is surprising that the court named it (Transneft) the weak side, the deal was studied for a long time, it passed all the corporate procedures, it was described by Transneft representatives in detail, submitted to Transneft management for approval, it was approved, everyone there knew about it,” she said.

Deals with derivatives are complicated and judges may have difficulties in interpreting them. “I am absolutely sure that our appeal will be successful. I hope that courts will study our situation seriously,” she said.

(59.6564 rubles – U.S. $1)

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