Western banks are showing renewed enthusiasm for Russia as the dust settles following the Yukos affair, while a flurry of stock market flotations suggests renewed confidence in Russia's economy.
Germany's Dresdner Bank announced on Wednesday it would buy a third of Gazprombank, Russia's No. 3 bank and a subsidiary of the state-owned Gazprom energy giant, for US$802 million.
The deal is the latest sign that confidence is returning to a Russian financial sector badly hit by the 1998 default crisis and the recent dismembering of the Yukos oil company, seen by critics as a Kremlin-inspired witch hunt.
Last Monday, top German bank Deutsche Bank said it would acquire the remaining 60 percent of Russian investment bank United Financial Group (UFG) for an estimated US$400 million, after it bought 40 percent of the company in 2003.
Unlike most of the US banks that deserted in 1998, when the Russian government defaulted on US$40 billion of debt, "we decided to stay in Russia and it was worth it," Deutsche Bank board member Tessen von Heydebreck said this week.
Deutsche Bank's move "is a sign of confidence in the growth, both now and in future, of the Russian market," said UFG's chairman, Charles Ryan, who is due to take the top post at Deutsche Bank Russia shortly.
Reflecting a wider economic confidence in Russia as well as growing revenues in the oil sector, the benchmark RTS stock market index has gained 70 percent since the start of this year.
Stock market flotations by Russian banks have raised US$4 billion so far this year -- a massive leap compared with the US$1.3 billion registered for the whole of the period from 1992 to last year.
Sistema, a consumer services company, raised US$1.56 billion in February in an initial public offering (IPO) on the London Stock Exchange, while steel company Novolipetsk and telephone operator Comstar are preparing to follow suit.
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