Alexandre Kotcherguine has become a familiar figure in the London capital markets.
As the head of international business development for MDM Financial, he is responsible for raising the profile of the bank outside its native Russia from almost zero to a prominence that has won it several awards, including best financial borrower in emerging Europe from Euromoney this year.
He organized MDM Financial’s debut Eurobond at the beginning of this year, as well as its $300 million commercial paper programme, and he is already talking about introducing a securitization programme. MDM is rapidly turning into a Russian bank that acts like a western bank.
Born in St Petersburg 43 years ago, Kotcherguine was studying civil engineering and architecture at Leningrad University as Mikhail Gorbachev steered the country towards openness. As light was shed on the secrets and mistakes of the Soviet Union, his generation, he says, “realized that what we were taught in school didn’t make sense. People started looking around for new ideas and new experiences.” Many looked abroad. Kotcherguine’s father was a famous theatre set designer, and thus able to travel more than most. Soon, the young Kotcherguine was keen to leave the country too.
He learnt that a great-great-uncle – a veteran of the White Russian army – was living in exile in Paris and visited him. He worked there briefly in an architectural firm, before moving to Canada, where he obtained a Canadian passport.
He attended a top business school in Ontario, and after graduating was hired by UBS, moving to Zurich with his Canadian wife.
“It was a great job,” he says. “I put together their first brochure in Russian.” At that point UBS had no presence in Russia. “I was one of the first Russians to work at UBS”.
After a while things quietened down in UBS’s Russian office. He didn’t know it, but UBS was preparing to merge with SBC, which had an office in Russia. Thinking UBS was slimming down its Russian operations, he moved in 1996 to Renaissance Capital, in Moscow, becoming its head of risk. “I felt I had to be where the action was.”
Renaissance before the 1998 crisis was very different to UBS in Zurich. Renaissance “was a completely unstructured environment”. Nonetheless, he set about building up what he considers was the first professional risk management team in Russia.
In the next two years, he built up a team of 40 people, and worked on Renaissance’s attempted merger with MFK, which taught some hard facts about Russian banking: “I learnt that what you see isn’t always what you get. But it taught me the ropes.”
In his two years with Renaissance, the firm’s equity capital grew from $25 million to $250 million. Then, in early 1998, he moved to London. The good timing was fortuitous : “People say, ‘Alex, how could you be so smart and move just before the Russian crisis?’ But the truth is, I didn’t know.” In fact, he moved to London because he missed his wife, who had moved back to Canada. She was expecting their first child, and they decided to meet halfway, in London, where he and his family have lived since. He says: “I had a choice between career and family, and I chose family.”
In March 1998, he was appointed as a senior risk officer at Paribas, responsible for the CIS region. While there, he was impressed by a MDM Financial delegation. “They were honest – they said: ‘there’s a big crisis coming. Take your money and run’. ” He had also been impressed by MDM Financial’s standard of disclosure while he was at UBS.
As predicted by MDM, the big crisis occurred in the autumn of 1998. Paribas was not badly hit – on a $260 million book it lost one transaction, worth $1.8 million.
He left in 1999, when Paribas closed down its Russian business, and moved back to Renaissance, to work in its London office. Then, in July 2001, he joined MDM.
Now Kotcherguine is working to help take MDM to the next level, by selling 10% to a strategic investor within the next year. That may be the first step to either a TNK-style strategic partnership, or a public flotation in a couple of years. And then Kotcherguine feels his work will be done at MDM Financial.
