UP: CHINESE BANKS
Long after their arrival was first rumoured, China’s banks are finally extending their reach into emerging Europe. In January, Bank of China became the first Chinese lender to set up shop in central and southeastern Europe when it opened a branch in Serbia, from which it is reportedly looking to cover the whole of the Balkans and neighbouring countries.
DOWN: RUSSIAN BANKS IN UKRAINE
It was not until president Vladimir Putin signed a decree in February recognizing passports from the Moscow-backed breakaway republics in eastern Ukraine, however, that policymakers in Kiev took up the cause. The following month, Ukraine’s central bank banned local subsidiaries of Russian state banks from transferring capital to their parents and made it clear that they were no longer welcome in the country. Nationalists drove home the message by building walls in front of bank branches.
UP: INTESA SANPAOLO IN RUSSIA
This time last year we flagged the Italian bank’s increasing enthusiasm for deals considered too dicey by even traditionally broad-minded western lenders. This strategy bore fruit in December, when Intesa acted as adviser and main financier of the €10.2 billion ($11.3 billion) sale of a 19.5% stake in Rosneft to Qatar’s sovereign wealth fund and Glencore.
DOWN: SOCIÉTÉ GÉNÉRALE IN THE CEE PERIPHERY?
Société Générale makes much of its market-leading franchises in the Czech Republic, Russia and Romania. Less well-advertised is the fact that the French group has commercial banking operations in a clutch of tiny markets on the periphery of CEE: FYR Macedonia, Montenegro, Moldova and Albania.
UP: THE BILL FOR PRIVATBANK
When the Ukrainian government nationalized PrivatBank in December and recapitalized it to the tune of $4.5 billion, policymakers were adamant that no further state support would be required. Unfortunately it appears that the more time its new owners spend looking into the books of PrivatBank, the more holes they find to plug.
Why does the bank need so much support? Well, that depends on who you ask. Ukrainian authorities say almost 100% of PrivatBank’s lending has effectively disappeared into entities related to its shareholders, led by powerful oligarch Ihor Kolomoisky. The former owners say this is a fabrication to justify the unlawful seizure of their bank.