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. Last Updated: 07/27/2016

Gref Says Sberbank May Sell Opel Stake to VEB

Sberbank may sell its stake in carmaker Opel to Vneshekonombank if it fails to find a domestic carmaker to be its industrial partner, Sberbank chief executive German Gref said.

The government wants to obtain Western technologies in order to reenergize local carmakers who are making deep losses as their products fail to compete with foreign makers.

Should Sberbank fail to link Opel with a domestic partner, it would set back hope that Russia can seize the crisis as an opportunity to bring struggling industries up to date.

“We’re very much interested in getting our stake in the hands of an industrial partner. … One of the possible options if we have any difficulties with establishing such an industrial partner would be to sell our stake to VEB,” Gref said.

Sberbank, along with Canadian auto parts maker Magna, reached a deal to buy a 55 percent stake in loss-making Opel from General Motors.

“According to the terms of the deal, we have a right to sell our stake without any consultations with other stakeholders to GAZ and VEB.”

The European Commission and officials from countries hosting Opel factories will discuss on Oct. 7 Germany’s controversial plan to grant state aid for the ailing carmaker.

Gref said he saw no formal problems with getting the deal closed.

Sberbank itself has continued to lobby for state guarantees so it could carry on lending to borrowers such as AvtoVAZ, he said. “We have almost everyone in our portfolio. It’s a rare bird that passes us by. So I shudder when anyone brings up bankruptcy, because we probably have a piece of them in our portfolio,” Gref said.

The government has allocated 300 billion rubles in 2009 as loan guarantees to stimulate lending and Sberbank has applied for 120 billion rubles of those guarantees for its clients already.

“Our interest here is huge because we have an enormous portfolio of developers and we can rehabilitate this portfolio only under one condition, if developers stay alive,” he said.

Gref said provisions for bad loans could rise above its forecast of 10 percent by the end of this year and 350 billion rubles will be totally channeled to newly created provisions.

“The process of restructuring bad debt is not over. … Next year will be the peak year when we will be going through the rubble,” Gref said.

For now, he said, the bank has few ways to claw back losses on bad loans.

“We have a sign out: ‘Everything for sale.’ There is a queue of buyers at the door, but unfortunately there isn’t that much solvent demand,” Gref said.

But Sberbank, which pledged 250 million euros for the Opel deal, will not go begging for state support, he said.

“If we need capital, we won’t ask the government for it, I hope, and will just sell stock on the market, including through a GDR,” Gref said, adding that the volume of any issue would “depend on the [economic] recovery.”