Page 7 - bne magazine September 2020 russia melting

bne September 2020 The Month That Was I 7
Finance
Eastern Europe
Russian government borrowing is
on course to hit its highest level in
15 years, Russia’s Audit Chamber said. The government needs to issue RUB4.1 trillion ($56bn) of government bonds to plug the shortfall in the budget due to the crisis. The Ministry of Finance had also earlier said that borrowing would probably double from this year’s RUB2 trillion already in the budget plan.
Russia's second-largest bank, state- controlled VTB, will pay out 10% of IFRS net profit as dividend for 2019, instead the previously planned 50%, due to the crisis. Russia's largest bank, state- controlled Sberbank, has confirmed it will pay the full 50% of profit as dividends.
Russia's second-largest private healthcare company MD Medical Group (MDMG) will propose
a generous RUB1.4bn ($19mn) total dividend at the shareholder meeting of September 3, making an increase of 55% year on year to RUB18.5 per share. The proposal would imply a dividend yield of 5% and payout ratio of 50% of net profit.
Chairman of the Board of the National Bank of Ukraine (NBU) Bohdan Danylyshyn has said that the receipt of two tranches from the International Monetary Fund (IMF) in 2020 is “unrealistic”, and called for a revision of the conceptual framework for co-operation on August 25.
Ukraine’s Finance Ministry has repurchased about 10% of its outstanding GDP-linked warrants, which were issued as part of a debt restructuring five years ago when the country was in the midst of a financial crisis following the EuroMaidan revolution. The warrants came into effect this year and will payout if GDP growth is over 3%.
The Belarusian ruble began to collapse
as the protests against Belarus' self- appointed president Alexander Lukashenko
went into a third week in August. Banks were selling the ruble for BYN3 vs dollar from around BYN2 a month earlier. Bloggers advised Lukashenko on the ruble exchange rate: "Try beating it with truncheons and stun grenades."
Central Europe
The private equity fund owners
of Poland’s top online retailer and auction portal Allegro want to list the portal on the Warsaw Stock Exchange in October. The potential IPO could be worth $2.3bn-3bn (€2bn-2.6bn), which would put Allegro’s valuation at some $11bn.23.
CEE's leading lender OTP Bank booked HUF78.6bn (€227mn) profit in Q2, down 25% y/y, above the HUF69bn consensus, as the rise in risk costs moderated from record levels in Q1, according to its earnings report. OTP reported a record HUF112bn profit in the same period a year ago.
The average mortgage rate in the Czech Republic fell to its lowest rate in two and a half years in July. The average interest rate last month was 2.15%, down from 2.21% in June. Mortgage rates have fallen in the Czech Republic for four months in succession and now they are at a level last seen in November 2017.
Southeast Europe
Turkish equities experienced the largest outflows by foreign investors for more than 15 months in August as Turkey’s currency weakened sharply. Non-residents
sold a net $566.5mn of stocks in the week through August 7, the biggest exit from the Istanbul market since March 2019, when authorities constricted supplies of dollars. The selling brings the net exit from Turkish stocks this year to $5.1bn.
Austrian Post has closed a transaction to boost its stake in Turkish parcel services provider Aras Kargo to 80% from 25%. The Austrian company has held a 25% stake in Aras Kargo since 2013. Baran Aras, from the Aras family, will continue to own 20% of Aras Kargo and will also serve on its executive board.
Turkish banks on August 24 stopped charging fees on physical FX withdrawals because “the practice has hurt confidence in the health of the financial system”. Turkish banks started charging the fees on foreign exchange cash withdrawals on August 13, nine days after the central bank permitted such commissions.
Vancouver-based Liberty Gold Corp closed the sale of its 40% interest in the Halilaga copper gold porphyry deposit in Biga Province, northwest Turkey, to Cengiz Holdings for a total consideration of $22mn.
Turkish renewables firm Aydem Yenilenebilir Enerji wants to IPO. Part of energy conglomerate Aydem Enerji, the company has applied to Turkey’s Capital Markets Board to conduct an IPO, but no details on the timing or size of the IPO were released.
Eurasia
Kazakhstan’s central bank warned on August 25 that projected budget deficits over the next several years may use up all the nation's rainy-day National Fund. The Kazakh authorities plan to rely heavily on the $65bn fund in upcoming years to fill budget gaps, drawing c$11.5bn out of the fund in 2020 and $8.9bn next year.
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