Russia: Every man for himself

Cracks in the group of 19 foreign banks negotiating with the Russian government had been evident for some time. Hardly surprising given the differences in their positions with large banks such as CSFB and Deutsche Bank too exposed to walk away and smaller banks, with less at risk, spoiling for a real fight. But no-one was prepared for the bombshell decision by Deutsche and Chase Manhattan to accept the latest offer for a portion of their holdings, concerning in Chase's case solely its own-account securities.

Since Deutsche, together with CSFB, was head of a six bank team chosen by the Russians to conduct the negotiations on behalf of the others, its unexpected move over the last weekend of February has caused the most consternation.

"I have never seen conduct like this before, it falls somewhere between brazen and stupid," says an executive with another bank involved in the discussions. "Any...