UPDATE: VTB Bank CEO sees central bank reducing key rate soon

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ST. PETERSBURG, Jun 5 (PRIME) -- The Russian central bank may soften the monetary policy at the upcoming meeting of the board of directors, scheduled for June 14, CEO of Russia’s second-largest lender VTB Bank Andrei Kostin said on Wednesday.

“We expect the regulator to take a set of steps to soften its monetary policy this year or maybe even at the next (meeting)… Last year, the central bank had to suspend measures to soften the policy… due to a weaker ruble and foreign capital outflow from the debt market,” he said.

The geopolitical tensions between the Western states and Russia do not become weaker, and there is no doubt that sanctions, including the U.S. sanctions, will last long, Kostin also said.

“Western sanctions create certain discomfort for the development of VTB’s business... our further actions are clear, we need to continue to optimize the business model, to increase cost efficiency, improve products and services, boost financial performance, and raise the stock’s market value and the dividends,” he added.

VTB hopes that a rise in VTB Group’s profit will ensure returning to paying 50% of the International Financial Reporting Standards (IFRS) net profit in dividends in the future, he also said.

VTB can increase a face value of its shares as the current low value is not very convenient, he added said.

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