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. Last Updated: 07/27/2016

Troika Gets Stake in Ursa Bank

Troika Dialog said Tuesday that it had agreed to buy a 7.9 percent stake in Ursa Bank, one of the country's largest regional lenders, amid indications that local banks will find it harder to tap foreign capital to fund further growth.

Troika Capital Partners' investment fund acquired the stake from SM Capital Group, which held a 19.1 percent share prior to the sale, SM Capital director and Troika board member Oleg Kirillov told reporters at a briefing.

The price paid for the stake was not disclosed.

Analysts have predicted that Novosibirsk-based Ursa would need to find alternative means of funding after it emerged as one of the more exposed Russian banks to the global financial turmoil because of its reliance on foreign borrowing to fund its rapid growth. Amid tighter liquidity conditions, access to wholesale funding from abroad has become harder and more expensive to get.

Ursa said it received 1.9 billion rubles ($77 million) in additional funding earlier this month from the Central Bank after pledging part of its credit portfolio.

"This was a bank which financed its growth from foreign borrowings, so they need to find other funding," said Natalya Orlova, a banking analyst at Alfa Bank. "I think this deal is largely a reflection of the liquidity situation."

Igor Kim, chairman of Ursa Bank, defended the bank's funding strategy, saying the global credit crisis could not have been foreseen. He added that the bank did not have concerns regarding the tighter liquidity conditions on the Russian market.

Troika Dialog has a long-running relationship with Ursa and managed its preferred placement in June Troika Dialog Group chairman Ruben Vardanyan has sat on Ursa's board since April.

Kim remains the controlling shareholder in the bank, with a 35 percent stake. The European Bank for Reconstruction and Development holds a 17.6 percent stake, while management have a further 8.3 percent, DEG a 6.4 percent stake and Clariden a 4.25 percent holding.