Russia: Reality bites oligarchs and banks
Russia’s mega-rich are fast emerging as victims of the global credit crunch.
Oleg Deripaska has been hit hard by the crisis
Russian billionaires are estimated to have lost more than $230 billion in the past six months as a result of plummeting equity valuations resulting in increasingly onerous debt repayment schedules. Over that period, the combined wealth of Russia’s 25 richest businessmen is reported to have fallen by more than 60%. Oleg Deripaska, reportedly Russia’s richest man, has been hit harder than most, suffering the ignominy of having to relinquish his 20% stake in Canadian car parts manufacturer Magna after French bank BNP Paribas called in a $1.5 billion loan used to acquire the company after a collapse in Magna’s share price. Deripaska was also hit by a margin call from Commerzbank, forcing his investment holding company, Basic Element, to give up its 9.9% stake in German construction firm Hochtief. Given further falls in the equity markets, Deripaska risks losing stakes in US carmaker General Motors, Austrian builder Strabag and, most notably of all, his 25% holding in Norilsk Nickel, the world’s largest nickel producer.