UMMC and Uralsevergaz bought the Ring of the Urals bank

Yesterday, General Director of OJSC UMMC-Holding Andrei Kozitsyn confirmed to a Kommersant correspondent the fact of the holding's entry into the authorized capital of the Yekaterinburg bank Koltso Ural LLC. In addition to UMMC, Itera’s subsidiary, OJSC Uralsevergaz, entered the authorized capital. Banking sector experts disagreed on the purpose of the transaction: some call it the acquisition of a cash settlement structure, others call it the purchase of a license with the aim of creating a large credit institution at the regional level.

LLC KB "Ring of the Urals" is the successor to Kub-Bank LLP. The bank was re-registered and its name changed in 1999. Now the bank is positioned as a universal bank. As of January 1, 2003, the bank’s assets amounted to 199.2 million rubles, equity funds - 71.1 million, of which 56 million are the authorized capital of the bank, deposits of individuals - 11.9 million. Profit for the reporting period - 1 7 million. The Bank holds a license to carry out banking operations with funds in rubles and foreign currency of legal entities and individuals. Before the transaction, control over the bank was exercised by its management.

The reason for buying the bank is the loss of UMMC and Uralsevergaz of their credit institutions. As Kommersant has already reported, at the beginning of this year the gas workers sold their stake in VUZ-Bank to the capital’s Probusinessbank. In turn, in September UMMC withdrew from the shareholders of the Ural Bank for Reconstruction and Development, selling the controlling stake belonging to it and its enterprises to the structures of its former partner Igor Altushkin.
In fact, UMMC immediately began negotiating the purchase of the bank. As the general director of the holding, Andrey Kozitsyn, noted, negotiations are ongoing “with a number of banks and not only regional ones.” However, two credit institutions were named in the banking community - OJSC Uralvneshtorgbank and Bank Ring of the Urals. In turn, the heads of both banks categorically refused to confirm the fact of negotiations.
Yesterday, UMMC General Director Andrei Kozitsyn told Kommersant that the deal had finally taken place. Commenting on the reasons for the choice, Mr. Kozitsyn stated that “this bank seemed to us the most attractive, transparent in terms of the composition of participants, as well as the structure of its assets and liabilities. “Ring of the Urals” most closely met the criteria that we set for the operation of a banking structure as part of the UMMC business.” The size of the package and the transaction amount are not disclosed. However, according to Kommersant's information, UMMC acquired a controlling stake.
Moreover, as it became known, the deal to buy out the blocking stake by Uralsevergaz is now being completed. As a source close to the Ural Mining and Metallurgical Company told a Kommersant correspondent, Uralsevergaz is negotiating the acquisition of a 7% stake from Koltsovo Airport OJSC. If no changes occur, then after completion of the transaction the gas industry will own about 49%. In turn, Uralsevergaz declined to comment.
The issue of forming the management team of the Ring of the Urals Bank is now being resolved. According to Kommersant, the new shareholders are negotiating the transfer to the bank of the current chairman of the board of VUZ-Bank, Sergei Grudin, to a similar post. According to preliminary data, the post of Chairman of the Board of Directors may be taken by the current commercial director of UMMC, Igor Kudryashkin.
Commenting on the fact of the takeover of Koltso Ural LLC, participants in the banking sector disagreed. In particular, Igor Vasiliev, assistant to the president of Ekaterinburg Municipal Bank OJSC, considers it unlikely to purchase a bank for the sake of obtaining its own credit resource. “Structures such as UMMC, for example, need borrowings of many thousands - $100-300 thousand. Taking into account the lending standards for bank shareholders - no more than 20% of its own funds, the bank will need huge injections. Therefore, I do not understand the reason for the deal,” he said.
In turn, Andrey Kremnev, Deputy Chairman of the Board of Uraltransbank OJSC, believes that the bank was purchased to make current payments, including cash settlement services. “And significant loans, most likely, will be made in Western, metropolitan banks,” he expressed his point of view. Igor Budzievsky, member of the board of Uralpromstroybank OJSC, agrees with him. “Most likely, UMMC, having lost its settlement bank, decided to fill this gap with another, also controlled. And the settlement bank does not need large assets, since in this situation the settlement bank usually does not perform the functions of a creditor.”
Other market participants are confident that the gas and metallurgical alliance bought the bank with serious goals of turning it into a full-fledged regional player. “To stay in the market, there must be a full-fledged medium-sized bank, and not a financial institution serving industrial structures. Otherwise, it will not be easy for the bank,” says Dmitry Kotsyuba, general director of CB Gran. According to his information, the new shareholders intend to increase the bank's authorized capital to 200 million rubles, which also speaks in favor of this version.
Mr. Kotsyuba does not exclude that the purchase of the Ring of the Urals will entail the transfer of all turnover of Uralsevergaz from VUZ Bank to a new structure. “This may lead to some reduction in the assets of VUZ Bank, but it is unlikely to worsen its solvency,” he believes. The University Bank itself, as well as the press service of Probusinessbank, refrained from commenting.
MARIA CHERKASOVA

Kommersant (Ekaterinburg) No. 228 dated December 16, 2003

Authors:

Maria Cherkasova

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