The Government Should not Completely Withdraw fr om the Sberbank Capital
On November 19, the First Deputy Prime Minister Igor Shuvalov stated that the government as a shareholder of Sberbank and VTB plans to withdraw from the capital of the two largest Russian banks within 5-10 years.
On the one hand, there is a need for the government partially to withdraw capital from Sberbank and VTB. From an economic point of view, it is quite pointless to keep such large equity participation; it is enough to have a 25% +1 share to monitor the activities of these institutions, especially with regard to additional revenue derived through privatization.
But on the other hand, in my opinion, it is absolutely unreasonable to withdraw from the Sberbank capital. Sberbank acts not only as a commercial bank, but performs also social functions – it supports unprofitable bank branches in remote areas wh ere no commercial bank would like to operate. Also, do not forget that many people pay housing and public utilities bills through Sberbank. In view of the above, I believe participation of the government in Sberbank should be preserved.
Moreover, with a full withdrawal of the state from the equity, systemic risks may increase. Recall that during the crisis the government saves Sberbank in the first place, thus ensuring the stability of the entire financial system, as Sberbank is the key credit institution in the overall financial system.
In addition, the Sberbank assets may be used by foreign market players, whose policy can be opposed to the national strategic interests of Russia.
The situation with VTB is different – this is rather a commercial bank with close to zero social burden, so the decision on the total withdrawal of the government from the this bank equity looks justified. The only thing to be done is to wait for the improvement of the market situation for the government to make the most of the transaction.
In general, the sale scheduled for 5-10 years looks like a letter of intent: "Perhaps it will happen", but it does not mean that the banks will be sold for sure.
A.L. Vedev, Director of the Center for Structural Research
But on the other hand, in my opinion, it is absolutely unreasonable to withdraw from the Sberbank capital. Sberbank acts not only as a commercial bank, but performs also social functions – it supports unprofitable bank branches in remote areas wh ere no commercial bank would like to operate. Also, do not forget that many people pay housing and public utilities bills through Sberbank. In view of the above, I believe participation of the government in Sberbank should be preserved.
Moreover, with a full withdrawal of the state from the equity, systemic risks may increase. Recall that during the crisis the government saves Sberbank in the first place, thus ensuring the stability of the entire financial system, as Sberbank is the key credit institution in the overall financial system.
In addition, the Sberbank assets may be used by foreign market players, whose policy can be opposed to the national strategic interests of Russia.
The situation with VTB is different – this is rather a commercial bank with close to zero social burden, so the decision on the total withdrawal of the government from the this bank equity looks justified. The only thing to be done is to wait for the improvement of the market situation for the government to make the most of the transaction.
In general, the sale scheduled for 5-10 years looks like a letter of intent: "Perhaps it will happen", but it does not mean that the banks will be sold for sure.
A.L. Vedev, Director of the Center for Structural Research