ST.PETERSBURG, May 18. /TASS/. About 27% of banks left the Russian market in two crisis years, most of them are medium banks in terms of assets, Mikhail Matovnikov, chief analysts with Russia’s largest savings bank Sberbank said.

Speaking at an offsite meeting of the bank’s committee on interaction with Sberbank’s minority shareholders in St. Petersburg, he said:

"We can state a serious banking crisis: about 27% of banks have left the market in two years," he said. He added that contrary to popular belief, these are not the smallest but medium banks that were hit by the crisis.

According to him, that happened because such banks are more market oriented and more sensitive to losing confidence of their clients.

According to the analyst the number of banks reduced from 922 (as of early 2014) to 697 as of May 2016.

The major banks also faced problems, because the rules of the game on the market radically changed in 2015, Matovnikov said.

"They used to believe that if a bank is large, it won’t go bankrupt but everything changed with the bankruptcy of Probusinessbank, the Central Bank revoked its license in August 2015, despite the fact that the bank itself was special administrator of three banks," he said.

The next "line of defense" was the conviction that if a bank provides services to important enterprises - for example in defense and space industries - it would not face any difficulties. However, the license of NOTA-Bank, which provided services to space industry enterprises was revoked, Matovnikov said.

The revocation of license of Vneshprombank became the "last straw", the expert said. That bank was about to enter top 30 of largest banks.

All these events cost a lot to the Russian economy, Matovnikov said.

"Over the past two-plus years one trillion (rubles) was spent on additional capitalization of banks, and if we take into account the money spent on Vnesheconombank, the figure will be almost 1.8 trillion (rubles)," Matovnikov said. He added that rehabilitation of banks cost the Russian authorities 900 bln rubles.

According to his presentation, in 2014-205 tha banking crisis cost Russia 3,4% of its GDP.