Page 68 - bne IntelliNews Country Report: Russia Dec17

Otkritie, made a similar filing on October 27, saying the bank could not repay the money and interest of $4.7 mn. OFCB has issued a further $500mn of subordinated debt, according to Otkritie’s website, although the status of this was not immediately clear.
Financial Corporation Otkritie, the major private bank recently bailed by the Central Bank of Russia (CBR), postponed the date of writing off $300mn worth of subordinated bonds , the bank said on Ireland Stock Exchange. Earlier, the CBR announced that all outstanding subordinated debts of lenders it is rescuing are to be written off. Holders of Otkritie’s $500mn bonds expiring in 2019 have reportedly been lawyering up to sue the regulator in London before the writing off process has begun. So far, Otkritie has postponed writing off the bonds lacking the needed majority on the latest shareholder meeting. The bank was also supposed to write off another $200mn subordinate debt on November 8, but no information has been received on this issue, Vedomosti daily said on November 8. The value of Otkritie bonds has been declining since August 29, when the CBR announced it is taking over the ailing lender. In October $500mn subordinated bonds were trading at 7.6% of their face value, which corresponded to a 309.9% annual yield.
Otkritie Investments Cyprus Limited (OICL) controlled by the Financial Corporation Otkritie holding, bailed by the Central Bank of Russia (CBR), has bought RUB3.2bn ($54mn) worth of GDRs of Russia's leading electronic payment system Qiwi , Interfax reported on November 10 citing the company. The share of OICL in Qiwi increased to 8.9%. Alfa Bank commented on November 11 that "current difficulties at Otkritie are unlikely to affect Qiwi's investment case," while recommending to buy Qiwi shares at current levels. This view is also supported by VTB Capital, claiming that latest OICL transaction "support our view that Otkritie Holding is unlikely to sell Qiwi’s shares on the market at the moment." Qiwi specializes in payment services via physical, online and mobile channels, processing over RUB69bn (€1bn) of cash and electronic payments per month and servicing more than 18mn virtual wallets and 157,000 kiosks and terminals. Otkritie became a Qiwi shareholder in 2015, when it contributed its Contact money transfer system and Rapida payment processing platform in exchange for 5.6mn Qiwi shares. In June reports claimed that Otkritie plans to increase its ownership in the Russian payment system Qiwi to 63.85%, paying about $700mn for the stake. Since then, Otkritie went bust in late August, followed by Binbank in early September, becoming the first major lenders to be rescued through the newly established Banking Sector Consolidation Fund (BSCF).
Russian industrial group Safmar has transferred its shareholdings in a number of companies, including oil company Russneft, to Safmar’s Rost
and Binbank ( aka B&N bank) as part of a bailout process, a central bank
deputy chairman said. B&N and Rost, part of the Safmar group controlled by tycoon Mikhail Gutseriyev’s family, were taken over by the central bank last month. The move came less than a month after the bailout of Otkritie, another large Russian lender. The Gutseriyev family has promised to transfer assets worth over 300 billion roubles ($5.2 billion) to its banking group to reduce the central bank’s contribution to the bailout. Investments in house builder Inteko and oil company Russneft were among those moved.
Leading Russian pension fund Budushchee posted a loss of RUB2.6bn
68 RUSSIA Country Report December 2017 www.intellinews.com