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. Last Updated: 07/27/2016

Barclays Capital May Open a Moscow Branch in 2007

bloombergHans-Jorg Rudloff
Barclays Capital is likely to open a Moscow office this year, its head of European investment banking said, making it the latest Western financial heavyweight to expand in the fast-growing Russian market.

The move comes after BarCap, the investment banking arm of British lender Barclays, handled a slew of Russian debt deals last year and Chairman Hans-Jorg Rudloff was elected to the board of state oil giant Rosneft.

John Winter, Barclays Capital's head of European investment banking and debt capital markets, said the likely opening would come as Barclays expanded in its "newer markets."

"We've been proactively covering clients in Russia for several years, and given the growth in the business, we think it makes sense to open an office this year, although how big and how extensive is subject to a variety of factors," Winter said late last week.

Winter was adamant the move was a new initiative for Barclays Capital, despite the bank's chequered history in Russia. Barclays closed its Russian representative office in 1999 after Barclays Capital lost $250 million in the country's financial crisis.

Winter, who covered Russia for Deutsche Bank during the 1998 crisis, said the country was unrecognizable by comparison with that time.

"Russia's no longer an emerging market; it's emerged," he said. "It's a solid investment-grade country with 145 million people and a large, rapidly growing and diversifying economy. The ruble's convertible, and they've got huge foreign reserves."

Lehman Brothers and BNP Paribas are also looking to expand.

"The market for consumer finance is booming in Russia, particularly credit cards and mortgages," Winter said, while Russia also boasts "some huge companies" such as Rosneft and Gazprom.

BarCap's 2006 workload included bond deals for a string of Russian banks; asset-backed deals such as the country's first public residential mortgage-backed security; and syndicated loans for Rosneft, Sberbank, TNK-BP and others.