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April 29, 2022

Russia mulls VTB, Otkritie and RNCB merger as sanctions bite

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Russia is considering the option to merge RNCB and Otkritie Bank into state lender and larger peer VTB Bank in the wake of sanctions imposed by the US and its allies over the invasion of Ukraine.

All three banks are currently facing sanctions from the US, the UK, and the EU. 

VTB Bank head Andrei Kostin had proposed the idea to Russian Prime Minister Mikhail Mishustin, Interfax reported citing Russian daily Kommersant.

RNCB is a Federal Property Agency-controlled Crimean bank, while Otkritie Bank is a subsidiary of the Central Bank of Russia. 

Notably, President Vladimir Putin has already approved the plan, the publication said. 

Sources told Kommersant that Putin believes that consolidating the banks will help them save on operational expenses such as branches and staff. 

It will also help bring a “major federal player to Crimea,” the paper said. 

The government’s decision to consolidate state financial assets around a strong player is economically and politically appropriate, a government source cited by Kommersant said. 

Consolidating these assets will allow the government to optimise its expenses while having a competitive edge in the market. 

The news outlet’s sources said that the Central Bank of Russia is in favour of the proposal. 

Notably, the central bank bought a stake in Otkritie Bank after rescuing it in 2017. 

Ever since it has been trying to divest its Otkritie Bank stake via an IPO or sale. But all the efforts were put on hold after Russia invaded Ukraine in February this year. 

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Disruptive start-ups to watch out for

2021 was a record-breaking year, with more businesses breaking into the billion-dollar club. Many start-ups have achieved or retained the unicorn status by the end of the year to reflect nearly a fivefold growth from that in 2020. This boom can be linked to a financing frenzy spurred by the quick adoption of technology and innovative solutions by start-ups gaining traction in response to the pandemic. However, the start-up ecosystem is now facing turbulent times for fundraising as investors seek long-term business strategies, valuations, and a route to profitability amid uncertain market circumstances. Nevertheless, 2022 has the potential to carry forward the momentum with multiple entities having a fair chance of being in the right place when aided by the right technologies. GlobalData leverages the power of alternative data to examine the health of start-ups across multiple dimensions including the quality of their innovations, market presence, and the funding they can attract. This helps our clients to analyze the disruptive potential of start-ups for early alliances, investments, and acquisition prospects to develop future-proof strategic roadmaps for a competitive advantage. Read our report and gather insights on the following topics:
  • Recent Unicorn trends
  • Unicorns in 2022
  • Future Unicorns
  • Start-ups to watch out for
Start-up ecosystem outlook by top geographies
by GlobalData
Enter your details here to receive your free Whitepaper.

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