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. Last Updated: 07/27/2016

Sberbank to Sell Foreclosed Real Estate

MTSberbank has accumulated a collection of real estate assets after indebted developers have gone into default.

NIZHNY NOVGOROD — Sberbank will complete and sell real estate projects after foreclosure, deputy chief executive Yevgeny Korolyov said Thursday.

“We will complete and sell [the projects] to the highest bidder. Our aim is to return as much money as possible,” Korolyov said on the sidelines of a banking conference.

“For now, [the bank] hasn’t foreclosed on many projects. I would say that less than 5 percent of the projects we financed have come into our hands,” he said.

His comments offered a rare insight into Sberbank’s strategy for the real estate assets it has accumulated as nonperforming loans rise.

For now, the country’s state lenders, the biggest creditors to the struggling real estate industry, have played their cards close to their chest, keeping seized assets off the market and preventing pressure on real estate prices.

“For example, we get [an uncompleted building]: … First, we would try to sell it right away. The next option is to find a builder to finish it. We could even finance the remainder of construction,” Korolyov said.

He added that the government was the most likely buyer of distressed properties. “All the developers are chasing the state, and we are no different,” he said.

He declined to discuss specific foreclosures, though he said the bank had some ready-built apartments on its books.

Media have reported that the bank received a stake in a major commercial project, City of Capitals, an office complex in Moscow’s new business district.

Korolyov said the bank had teamed up with the government of St. Petersburg to create an auction house to sell off noncore assets, including via Internet sales.