Sberbank Takes Pick of Insurers

Sberbank plans by the end of this month to select an insurance company to write a policy that covers the bank's regional buildings and its central office in Moscow.

For the first time, the bank will float a tender for the contract, which has an estimated value of 7 billion rubles ($240 million).

Sberbank sent invitations to several insurance companies at the end of February to participate in the tender to insure the bank's roughly 100 regional buildings, with a total value of some 2 billion rubles, and its central office, worth 5 billion rubles. The real estate, including internal furnishings and equipment, will be insured from fire and other damage.

The participants in the tender include only the largest companies, such as Rosgosstrakh, Ingosstrakh and the military-insurance company RESO-Garantia.

The results of the tender will be announced soon, said insurance providers. "We're all waiting," said the chairman of management at Ingosstrakh.

Rates for this type of insurance range from 0.2 percent to 1.5 percent. The insurance package will cost Sberbank from $500,000 to $3.75 million. Sberbank's press service could not be reached for comment.

In the past, tenders for providing services to the bank were not conducted, according to a high-ranking representative of the bank who declined to be named. "We do everything with tenders now," said the representative. "We adopted internal regulations and conduct tenders everywhere to prevent hooliganism from our side or the outside."

The representative declined to give any details of the tender. "Our administrators will take care of that," he said.

Insurance providers were asked to present a number of documents including financial accounts, said a representative of one of the tender participants, who declined to be named.

But no concrete demands for financial information were made, said a different insurance provider. A letter with an invitation to participate in the tender was sent personally to companies, which were admitted into the competition in advance, he said.

Sberbank also recommended that insurance providers fill in tables with their insurance rates, independent of the number of buildings and the potential increase of the insurance payments for regional buildings, from 2 billion rubles to 6 billion rubles.

"They are trying to estimate to what extent the insurance rates will change when the sum of the contract is increased," said a representative of an insurance company involved.

The results of the tender will be announced at the end of April, and then an agreement will be reached with one or several insurance companies.

"It will be a real transaction approved at the highest level [of the Sberbank management]," said a representative of Ingosstrakh.