Split for accessibility

Sberbank may complete stock split faster than expected

The long-awaited split of shares of Sberbank, Russia's leading blue chip banking company, will begin on July 18. According to analysts, with an increase in the number of securities and a decrease in their cost, they will become more accessible to a wide range of investors. Market participants are already revising the estimated prices for Sberbank shares. Yesterday, quotes rose by 2.3%, once again updating their all-time high. The RTS index rose by 2.69% to 2049.18 points.

As Sberbank reported yesterday, the Central Bank has registered two of its additional issues of shares, which will be placed as part of the split. The first consists of 21 billion 586 million 948 thousand ordinary shares with a par value of 3 rubles. The second is from 1 billion preferred shares of the same par value. The shares will be placed by private subscription by exchanging old ones for new ones. The meeting of Sberbank shareholders approved the exchange ratios on June 29: for ordinary shares - 1 to 1000, for preferred shares - 1 to 20. At the same time, the President and Chairman of the Board of Sberbank Andrey Kazmin noted that the splitting procedure would take three to four months. The split was expected to end in September, but it looks like it will happen a little sooner.

During the period of the exchange of shares, the exchanges will suspend trading in them. On the classic RTS market this will happen today, since its system assumes settlement of transactions within three days from the date of conclusion. And from July 18, it will be impossible to trade Sberbank shares on any platform - from this day operations on the MICEX and the RTS exchange market will be suspended. “Trading in Sberbank shares on the MICEX will continue until July 17 inclusive. On July 18, the conversion of securities will begin, so there will be no more transactions. During the break, the issue will be registered taking into account conversion. After this, the issuer will send an application to the MICEX to include the securities in the quotation list, and the exchange will make this decision. After this, trading will resume,” the MICEX stock exchange explained to Vremya Novostey. They expect the entire procedure to take one to three weeks.

Although the splitting of Sberbank shares was expected, quotes yesterday grew quite well and reached a new maximum. On the classic RTS market, ordinary shares of Sberbank rose in price by 2.33%, to $4,150 thousand (there were no transactions on the exchange market); on the MICEX exchange - by 2.4%, to 106.7 thousand rubles. This assessment of Sberbank is clearly not the limit; analysts and market participants expect that the split will give the shares more liquidity and increase both the number of transactions and the price. “Almost everyone gives good forecasts for Sberbank,” says Ak Bars Finance analyst Polina Lazich. According to her, analysts began to predict the estimated price of the bank’s shares immediately after the shareholders’ meeting, at which Mr. Kazmin announced three-year prospects for the development of the credit institution. According to Ms. Lazich, the estimated price of an ordinary share of Sberbank for the year, taking into account the split, will be $4,485 thousand. “Now the price of shares does not allow private investors to include them in their portfolio; the purchase of one very expensive security is rather a psychological barrier . After the split, the number of transactions, that is, the liquidity of shares, will increase by at least 20%, and the securities will become more accessible to private investors,” the analyst sums up.

Despite such a significant event, Sberbank was unable to catch up with yesterday's growth champions - Rosneft (whose shares rose by 4.79% on the RTS and by 4.27% on the MICEX), Gazprom (+3.04% on the RTS and 3.05% on the MICEX) and Norilsk Nickel (3.54% on the RTS and 3.57% on the MICEX). Rosneft shares rose on information about its victory in the auction for the sale of the remaining assets of Yukos (its property in the East Siberian fields). Shares of other companies in the oil refining sector were boosted by rising oil prices.

Elena KHUTORNYKH, Natalia ROMANOVA