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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.
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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.
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By GlobalDataSources 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.
