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. Last Updated: 07/27/2016

Unexim, U.S. Bank Sign Deal

The Bank of New York and Uneximbank on Tuesday signed a previously announced agreement for the Russian banking powerhouse to work as the U.S. bank's subdepositary on the local equities market.


Uneximbank will initially hold Russian company shares purchased by Bank of New York clients, in particular large U.S. mutual funds, and handle some other depositary activities that simplify procedures for non-residents to open investment accounts.


Those exclude operations with American Depositary Receipts, but the Bank of New York's senior vice president Kenneth Lopian said at Tuesday's signing that "it's certainly an option" in future for Uneximbank to work with the ADR programs.


Uneximbank said in a statement that it continues to discuss similar arrangements with other "strong, foreign depositary banks." In May, the U.S. Securities and Exchange Commission granted Uneximbank the status of a reliable foreign depositary under statute 17 f-5.


Separately, a meeting between the Bank of New York and Rostelecom -- the giant Russian telecommunications concern and the only company to contest liability for its independent registrar required under U.S. Securities and Exchange Commission rules -- could take place as soon as Wednesday.


"We don't disagree with [Rostelecom's] conservative approach" about liability, Lopian said, but added that the bank had to abide by U.S. regulations.


"We have confidence that we'll work this through," said John Yancey, Bank of New York's senior securities officer in Moscow. "The focus [of U.S. regulators] is on disclosure, and at this stage, this is appropriate language for the market."


Rostelecom on Tuesday issued a statement reiterating that its ADR process was going ahead, in partnership with the Bank of New York.