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Financial recovery of B&N Bank not to affect stability of banking sector — Sberbank CEO

September 22, 17:50 UTC+3

Sberbank CEO Herman Gref believes that financial recovery procedures of large Russian banks are most likely to end

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ISTANBUL, September 22. /TASS/. Financial recovery of B&N Bank will not affect stability of the Russian banking sector but will lead to its strengthening, Chief Executive Officer of Sberbank Herman Gref told reporters.

"This [financial recovery of B&N Bank - TASS] will not affect stability of the banking system at all. It is important that owners are cooperating with the Central Bank. This will lead to strengthening of the banking sector," Gref said.

Gref said he believes that financial recovery procedures of large Russian banks are most likely to end, he told reporters on Friday.

"As far as I know, the banking sector does not have these problems anymore. It seems to me that now the situation among large banks will be healthier, and the Central Bank, having seized control, calmed down the situation in the banking sector," Gref said.

He added that the Central Bank guarantees the rights of all bank customers without exception and no one’s interests would be hurt.

Sberbank is not yet ready to sell its banking business in Turkey because the economy is recovering there, Gref noted.

"We are dealing with business and a situation may occur at any time when we are buying or selling a portion of our business. However, we do not have plans to sell our business in Turkey now," he added.

Earlier Governor of the Central Bank Elvira Nabiullina said at the International Banking Forum that the market hardly reacted to the situation with Otkritie bank.

"We can now state that the negative effect of reorganization of Otkritie bank on the financial market was minimal. There is no outflow of deposits from other banks. Tere is a slight increase in bond yields by 100-150 basis points, but it does not have systemic risks, and the market hardly reacted to it, "she said.

Earlier Nabiullina noted that, in general, the situation in the Russian banking sector is stable, and the "problems of Otkritie are not related to the general problems of the banking sector, but to the business strategy of the bank."

Earlier the Central Bank announced measures aimed at improving the financial stability of B&N Bank through the Fund for the Consolidation of the Banking Sector. The recovery procedures will be conducted in two stages and will take from six to eight months, the regulator said. According to the Central Bank, the regulator will take ownership of at least a 75% stake in B&N Bank after the financial recovery procedure.

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