Page 9 - bne_Magazine_July_2017

bne July 2017 The Month That Was I 9
Finance
Central Europe
The Czech central bank will raise counter-cyclical capital requirements for banks as part of a campaign to temper hot credit markets. The CNB said that from July 1, 2018 banks must hold a buffer of 1% against domestic lending. The current counter-cyclical buffer, introduced at the start of the year, stands at 0.5%.
Investment into CEE commercial real estate is set to reach a new record in 2017, property consultancy CBRE pre- dicted. In the past 12 months, €12.2bn was invested by investors into core CEE markets, reaching a new peak for four rolling quarters. That momentum is expected to continue through the year, the agency says, with 2017 volumes set to surpass the €11.3bn recorded last year.
Investment flows into Czech com- mercial real estate almost doubled in annual terms in the first quarter of 2017 to total €1.57bn, Colliers International research showed. Yields on the Czech market have been pushing to historic lows over the past couple of years, as cheap financing and the hunt for yield herds investors into CEE property.
A private equity fund controlled by a Hun- garian oligarch regularly named as a proxy for the prime minister has agreed a deal to buy a 49% stake in MKB Bank. Once the deal goes through, Lorinc Meszaros – the mayor of Prime Minister Viktor Orban’s home village – will directly and indirectly hold 49% of the shares in MKB, further boosting his interest in the Hungarian banking sector. The former plumber previ- ously raised his stake in state-owned mort- gage bank FHB Jelzalogbank on April 21.
Southeast Europe
A Moldovan court has sentenced Ilan Shor, the main suspect in the $1bn bank frauds that surfaced in 2014, to seven and a half years in prison. In his capacity as head of the management board of Banca de Economii (BEM), Shor was found guilty of siphoning off MDL5bn ($360mn) from the bank in November 2014.
Slovenian Prime Minister Miro Cerer announced that his government
has decided to give up on the IPO
of the country’s largest lender Nova Ljubljanska Banka (NLB). The decision was made after his cabinet rejected €55 as the minimum bid price per share earlier in the day.
Eastern Europe
The board chairman of Ukraine’s nationalised PrivatBank, Oleksandr Shlapak, tendered his resignation, just three days after national authorities said they will inject another UAH38.5bn (€1.3bn) of additional capitalisation to the country’s largest lender.
Russian Regional Development
Bank (VBRR), a subsidiary of Russia's Rosneft oil major, now controls 99.99% in the capital of troubled "church bank" Peresvet, after acquiring an additional share issue of the bank. This is Russia's first case of bail-in where the failed bank is supported with its creditors' funds. The Central Bank
of Russia (CBR) pledged to provide RUB66.7bn (€1bn) to VBRR for covering holes in Peresvet's capital, while another RUB69.7bn was to
be provided by creditors of the
"church bank" by acquiring 15-year convertible bonds.
The Moscow court of arbitration has ruled that Russia's largest bank Sberbank should compensate state oil pipeline monopoly Transneft for
RUB67bn (€1bn) that was lost on currency hedging operations with the bank as a result of ruble devaluation in 2015. While the court argued on June 23 that Transneft was not fully informed of all the risks associated with the hedging instruments, Sberbank said it will appeal the ruling, calling it a dangerous precedent that would undermine the derivatives market and lead to massive banking losses.
Eurasia
A group of creditors that has reportedly lent International Bank of Azerbaijan (IBA) $220mn objected in a US court to the lender’s debt restructuring plan saying it “runs roughshod over certain fundamental rights”. They include asset managers Fidelity Management & Research Company and Franklin Templeton Investment Management and hedge funds Promeritum Fund and VR Global Partner.
Second largest Kazakh lender Halyk Bank is to provide 185bn tenge (€520.5mn) to recapitalise largest lender Kazkommertsbank (KKB) after buying a 96.8% stake for a nominal sum. KKB’s bad loans problem stems largely from its takeover of failed bank BTA in 2015. The state will first buy up KZT2.4 trillion of KKB’s bad loans.
China’s Citic Bank and the investment arm of state-run China Tobacco have agreed to buy 60% of Kazakhsan’s Altyn Bank, owned by Halyk Bank, which will retain a 40% stake of
Altyn Bank.
The Shanghai Stock Exchange is to acquire a 25.1% stake in Kazakhstan's new stock exchange, set to launch
as part of the Astana International Financial Centre (AIFC), a financial services hub to be run as a free economic zone modelled on Dubai’s International Financial Center.
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