Stock Market News & Stocks to Watch from StraightStocks » Chris Weafer http://www.straightstocks.com Leading Stock Market News, Opinions and Commentary Thu, 26 Nov 2009 10:32:19 +0000 http://wordpress.org/?v=2.8.5 en hourly 1 Energy Blast – September 8, 2009 http://www.straightstocks.com/investing-in-russia-stocks/energy-blast-september-8-2009/ http://www.straightstocks.com/investing-in-russia-stocks/energy-blast-september-8-2009/#comments Tue, 08 Sep 2009 09:40:45 +0000 Robert Amsterdam tag:www.robertamsterdam.com,2009://1.20696 http://www.straightstocks.com/investing-in-russia-stocks/energy-blast-september-8-2009/feed/ 0 Today in Russian Business – August 28, 2009 http://www.straightstocks.com/investing-in-russia-stocks/today-in-russian-business-august-28-2009/ http://www.straightstocks.com/investing-in-russia-stocks/today-in-russian-business-august-28-2009/#comments Fri, 28 Aug 2009 08:47:34 +0000 Robert Amsterdam tag:www.robertamsterdam.com,2009://1.20576 http://www.straightstocks.com/investing-in-russia-stocks/today-in-russian-business-august-28-2009/feed/ 0 Video: Prokhorov on the Metals Merger http://www.straightstocks.com/investing-in-russia-stocks/video-prokhorov-on-the-metals-merger/ http://www.straightstocks.com/investing-in-russia-stocks/video-prokhorov-on-the-metals-merger/#comments Tue, 09 Jun 2009 11:44:54 +0000 Robert Amsterdam tag:www.robertamsterdam.com,2009://1.18920 http://www.straightstocks.com/investing-in-russia-stocks/video-prokhorov-on-the-metals-merger/feed/ 0 Weafer: Kremlin Gunning for Norilsk http://www.straightstocks.com/investing-in-russia-stocks/weafer-kremlin-gunning-for-norilsk/ http://www.straightstocks.com/investing-in-russia-stocks/weafer-kremlin-gunning-for-norilsk/#comments Mon, 08 Jun 2009 14:52:35 +0000 Robert Amsterdam tag:www.robertamsterdam.com,2009://1.18905 http://www.straightstocks.com/investing-in-russia-stocks/weafer-kremlin-gunning-for-norilsk/feed/ 0 Russia’s Macro Data Starts To Confirm The Severity Of The Downturn http://www.straightstocks.com/investing-in-russia-stocks/russias-macro-data-starts-to-confirm-the-severity-of-the-downturn-2/ http://www.straightstocks.com/investing-in-russia-stocks/russias-macro-data-starts-to-confirm-the-severity-of-the-downturn-2/#comments Sat, 20 Dec 2008 09:29:00 +0000 Manuel Alvarez-Rivera tag:blogger.com,1999:blog-1443720106009957151.post-3977059694237064673 http://www.straightstocks.com/investing-in-russia-stocks/russias-macro-data-starts-to-confirm-the-severity-of-the-downturn-2/feed/ 0 Letting the Ruble Slip http://www.straightstocks.com/investing-in-russia-stocks/letting-the-ruble-slip/ http://www.straightstocks.com/investing-in-russia-stocks/letting-the-ruble-slip/#comments Tue, 11 Nov 2008 16:08:21 +0000 Robert Amsterdam http://www.robertamsterdam.com/2008/11/letting_the_ruble_slip.htm indicated during a televised address yesterday that authorities would finally allow the value of the ruble to slip against its mixed basket of currencies (55% dollars, 45% euros), the markets have reacted rather negatively, with the MICEX dropping 10%. Chris Weafer tells Bloomberg that "They're going to move the line in the sand back a little bit, where they hope they can defend it. If people start to lose confidence in the banking system, we could have a massive run on the banks as we saw twice in the nineties, and then the game is up.'' Most analysts expect that Russia is still holding enough FOREX to keep the ruble from collapsing, but will likely allow a gradual decline until oil prices bounce back.]]> http://www.straightstocks.com/investing-in-russia-stocks/letting-the-ruble-slip/feed/ 0 The Gazprom Invasion of Alaska http://www.straightstocks.com/investing-in-russia-stocks/the-gazprom-invasion-of-alaska/ http://www.straightstocks.com/investing-in-russia-stocks/the-gazprom-invasion-of-alaska/#comments Wed, 15 Oct 2008 13:52:51 +0000 Robert Amsterdam http://www.robertamsterdam.com/2008/10/the_gazprom_invasion_of_alaska.htm bruins.jpgThe press and blogosphere are of course having a field day with the news that executives from Gazprom are enjoying a road show in Alaska this week to woo local representatives and meet with ConocoPhillips, possibly discussing participation in natural gas pipeline down to the lower 48 states. Given that Gov. Sarah Palin, the eminent "Kremlinologist," has placed so much emphasis on her foreign policy expertise with Russia, the Gazprom invasion is embarrassing to say the least. Some think that the timing of the Alaska visit carries a message:
"The timing is as interesting as the visit itself," said Chris Weafer, chief strategist at UralSib Financial in Moscow. "Gazprom's entire senior management goes into Sarah Palin's backyard during a contentious election. There's a message there."
However let's not lose the plot completely. Gazprom has had a business presence in the United States for years now, with a sales and marketing office in Houston, delegations send to conferences such as the CERA, and various agreements with American firms. They even once spent a month touring the USA with a Gazprom-sponsored ice hockey team to promote the brand ... I don't recall anybody assailing Mitt Romney of rolling over to the Russian invasion when the Boston Bruins re-enacted the miracle on ice with the Gazprom team.]]> http://www.straightstocks.com/investing-in-russia-stocks/the-gazprom-invasion-of-alaska/feed/ 0 Iceland Gets Left Out in the Cold http://www.straightstocks.com/investing-in-russia-stocks/iceland-gets-left-out-in-the-cold/ http://www.straightstocks.com/investing-in-russia-stocks/iceland-gets-left-out-in-the-cold/#comments Tue, 07 Oct 2008 18:31:22 +0000 Robert Amsterdam http://www.robertamsterdam.com/2008/10/iceland_gets_left_out_in_the_c.htm iceland100708.jpgOne of the biggest problems with the United States becoming a debtor nation instead of a creditor is that we really lose any ability to help out our valued friends in times of trouble. As such, the banking crisis in Iceland has forced the government to turn to Russia - who is happy to throw some of its excess liquidity toward the relatively stable instruments of the country in the form of a $5.4 billion loan. Reykjavik is really not all that happy about it, and seems to display some awareness that this is exactly the kind of deal that can end up outsourcing your Ministry of Foreign Affairs to Kremlin oversight just like Finland. Prime Minister Geir Haarde tells the Financial Times, "We have not received the kind of support that we were requesting from our friends. So in a situation like that one has to look for new friends. (...) In a situation like this it’s turning out that it’s every man for himself, every country for itself, everybody’s taking care of their best interest and that’s what we are doing." Chris Weafer tells the FT that this loan is much more than an ordinary transaction, as it symbolizes both a clear statement that Russia still has extra cash and will look forward to enjoying support from Iceland on future territorial claims in the Arctic. James Beadle of Pilgrim Asset Management tells the New York Times that "It’s a P.R. stunt to reassert Russia’s position in the global economy of the 21st century." I believe that this loan demonstrates that Russia continues to have a very good understanding of what Walter Russell Mead would call "sticky power," and it would do Washington very well to remember how much this financial crisis is costing the United States in terms of its relationships with key allies.]]> http://www.straightstocks.com/investing-in-russia-stocks/iceland-gets-left-out-in-the-cold/feed/ 0 Russia’s hopes of creating a global financial hub come back earth http://www.straightstocks.com/investing-in-russia-stocks/russia%e2%80%99s-hopes-of-creating-a-global-financial-hub-come-back-earth/ http://www.straightstocks.com/investing-in-russia-stocks/russia%e2%80%99s-hopes-of-creating-a-global-financial-hub-come-back-earth/#comments Wed, 17 Sep 2008 13:34:00 +0000 Jason Corcoran tag:blogger.com,1999:blog-7619541933410184333.post-8394685599662797457
September 16, 2008


A series of setbacks has raised questions over whether Moscow could rival other centres and whether the rouble could become a reserve currency, writes Jason Corcoran


The credibility of Moscow's ambition of becoming a global financial centre within five years has been called into question following a summer of systemic shocks to investor confidence and the arrested development of its market institutions.

Highly liquid domestic markets, strong economic growth and a position at the heart of a booming region have contributed to the rapid growth of Russia's capital markets over the past decade.

The dual government of President Dmitry Medvedev and Prime Minister Vladimir Putin have a blueprint in place for building Moscow's position as a financial hub. Some institutions, especially the Federal Anti-Monopoly (FAS) commission, have grown in stature due to its recent high profile investigations into price fixing. The
administration is now adding to the institutional pillars brick by brick but some of the foundations appear shaky.

Russia's five-day war with Georgia over Southern Ossetia, along with a selling spree sparked by allegations of price fixing at miner Mechel, left domestic stock markets nursing 35% losses and two year lows at the end of August.

Analysts at French bank BNP Paribas estimated the conflict with Georgia could have triggered capital flight worth $25bn of outflows, while Russia's gold and foreign currency reserves fell by $16.4bn since the beginning of military operations on August 7.

Alexander Kotchoubey, head of international development for Russia and Eastern Europe at Swiss private bank Lombard Odier Darier Hentsch, believes Moscow's goal of becoming a financial centre had been pushed back to 2015-2020.

"The credibility of making Moscow a financial hub and transforming the rouble into a reserve currency has been hit," explained Kotchoubey, who was until recently a managing director at Moscow-based Renaissance Investment Management, an emerging markets fund manager with $7bn under management. "Investor confidence and the perception of stability in Russia depends on what people are thinking in London and
Frankfurt and neither one is present at the moment."

Foreign investors have highlighted the lack of corporate governance, the respect for the rule of law, uneven property rights and an abused taxation regime, as obstacles towards the development of domestic markets. Recent cases cited by investors include the price fixing probe of miner Mechel, allegations of tax evasion by fund manager
Hermitage Capital and the separate shareholder wrangles at the
Anglo-Russian TNK-BP and mobile group Telenor.

Yet Alexei Fedotov, head of securities and fund services at Citigroup's global transaction arm in Russia, believes the market reform process kick-started in 2005 is irreversible.

He said: "Russia is a unique BRIC market created as a result of mass privatisation of huge number of companies within extremely short period of time. Since 2005 the speculative growth of the market has been gradually replaced by growth caused by serious changes implemented by the government."

"Changes included liberalisation of banking stocks, Gazprom shares, liberalisation of Russian currency and huge unprecedented IPO growth. As a result the growth has attracted to the market investors and market players of a higher calibre."

Market makers have mixed views about the prospects of the rouble becoming a reserve currency, which is one of the central planks of President's Medvedev's plans to develop Moscow into a global financial centre.

One senior Western banker in Moscow said: "People have been slow to adapt to the Euro currency as a reserve. It's a good goal to have the rouble as a reserve currency but there needs to be much more done to achieve it."

Maxim Baklunov, head of equity sales at Russian investment bank KIT, fees the rouble could be a credible alternative to the dollar.

He said: "The plans of the Russian government to turn Moscow into an international financial centre and the rouble into a major regional reserve currency will make the Russian financial system more competitive. Taking into account the government policy seeking to increase the significance of the Russian currency and to reduce the
risks associated with fluctuations of the US dollar's exchange rate, we think that rouble has a good chance of becoming a major regional reserve currency."

A deepening liquidity, with volumes on domestic bourses recorded of up to $7bn a day, has lured leading US and UK investment banks to set up local brokerage subsidiaries over the past three years.

Citigroup has been a pioneer in Russian wholesale and retail banking and Fedotov argues the Russian growth story remain intact in spite of the recent volatility.

He added: "The volatility is not able to change improvements in the market and did not create reasons for a serious capital outflow or did it make the market fundamentally unattractive or risky. In view of that, there is a certain optimism that the market will continue to develop in coming years and foreign investment will grow.

"This, however, does not stop us from focusing on market improvements and working closely with local market participants and regulators to introduce such important changes as a central depository, foreign nominee concept, RUB RTGS settlement, which in our view will be able to further support market growth and make it irrevocable."

Citigroup is one of the few foreign brokers to be involved in the reform process with other bulge bracket rivals complaining of being left out in the cold.

The Russian government's plans to create an international financial centre in Moscow are based on a competitive taxation system, simplified registration and more permissive procedures for issuers and investors.

The Federal Financial Markets Service (FFMS), the main Russian market regulator, submitted a draft strategy to the government in March for the development of domestic capital over the next four years.

The report, entitled "Measures to Improve the Regulation and Development of the Securities Market in 2008-2012 and a Long-Term Horizon," is a blueprint for the development of the domestic capital market and outlines measures to revamp laws tax law, improve corporate governance, lower administrative barriers and simplify procedures, prevent manipulative practises and the use of insider information.

The domestic capital market plays a vital role in the government's plans for Russia's continuing economic revival. The new administration intends to tap domestic capital for the investment needed to revive Soviet-era industrial assets rather than rely on foreign capital.

Among some of the provisions proposed in the report are radical changes to the tax rules. Under discussion is the possibility of cutting the capital gains tax and a reduction in the tax on income from securities to zero.

One aim of these proposed changes is to make Russia a more attractive place to list shares than the offshore havens companies currently use. The FFMS is worried about losing capital market functions to foreign exchanges and has already introduced administrative controls to encourage companies to list onshore.

Its success has been only partial, as Russian companies that float IPOs now almost always list simultaneously in Russia and abroad.

Additional measures introduced by the FFMS in July restrict companies engaged in oil exploration or mining from selling no more than 5% of their shares abroad, a cut from the previous blanket level of 35% for all companies listing abroad.

The regulations limit foreign stakeholding in industries related to national security and defence to no more than 25%, while those making public offerings in other sectors may sell a maximum of 30% of their stock abroad.

After a slow start to the year for Russian equity issuance, some analysts argued that these rules could hamper Russian equity issuance and liquidity. "In the short term it will have no effect, but in the medium term it could slow down the pace of the IPO pipeline, says Chris Weafer, chief analyst at the Moscow-headquartered UralSib bank.

There were just 13 IPOs in the first half of this year - about half the volume over the same period last year - according to Russian data provider Offerings.ru.

The report, which is being debated in government circles, also suggests developing a futures market and a pooled investments market.

The regulator has drawn up a proposal for increasing the free float. The free float in Russia is currently about 20-30% percent of total outstanding shares. "The free float of securities in Russia should be increased to not less than 40- 50% in the nearest two three years," the document says.

There are currently no foreign securities listed on Russian bourses due to a lack of legislation and appropriate regulation. This could change later this year, however, because a draft law is already in the Duma, the lower house of the Russian parliament. Once new laws are passed, Russian investors will be able to invest via a domestic exchange in foreign companies' shares and depositary receipts.

Key figures within the government and the regulator are actively pushing for the creation of a central depository and a merger of two the main stock exchanges, the rouble denominated MICEX and the dollar-denominated RTS. Some market participants, who are shareholder and members of both exchanges, have privately complained of the pace of the integration of the two platforms.

After all these amendments are made, the regulator estimates the capitalisation of the Russian financial market will increase by $40-50bnm and Moscow will have a chance of evolving into a pan-CIS and Central European hub for capital markets.

However, Lombard Odier's Alexander Kotchoubey feels legislative reforms and institutional change will not mean much without the "intangible concept of investor confidence and market stability."

He said: "Russia was on the cusp. It had entered the top ten in market capitalisation and it had become essential to have Russian equity allocation in global portfolios. It is now facing a tremendous headwind from the war with Georgia and the blow-up at TNK-BP with investors now being very cautious about making any sort of allocation to Russia."]]> http://www.straightstocks.com/investing-in-russia-stocks/russia%e2%80%99s-hopes-of-creating-a-global-financial-hub-come-back-earth/feed/ 0 Russia’s stocks rally as Putin passes the presidency to Medvedev http://www.straightstocks.com/investing-in-russia-stocks/russia%e2%80%99s-stocks-rally-as-putin-passes-the-presidency-to-medvedev/ http://www.straightstocks.com/investing-in-russia-stocks/russia%e2%80%99s-stocks-rally-as-putin-passes-the-presidency-to-medvedev/#comments Tue, 24 Jun 2008 16:36:00 +0000 Jason Corcoran tag:blogger.com,1999:blog-7619541933410184333.post-6328961579634712326 Financial News

Jason Corcoran in Moscow
23 June 2008

Investment climate is steady as new leader continues reform agenda

Russia’s equity markets are enjoying the country’s honeymoon period under its new leadership, but investors remain wary of how the power-sharing arrangement will evolve.

The changing of the guard on May 7 saw Vladimir Putin hand over the presidential mantle to his protégé Dmitry Medvedev. Within hours, Medvedev had nominated his mentor Putin as Prime Minister.

The smooth choreography proved to be a fillip for Russia’s main stock markets and sparked a buying spree by foreign funds.

The MSCI Russia Index was the best performing emerging equity market last month, rising 15.7%, and outperforming the MSCI EM Emea index, which rose 7.3% in the same month. Inflows recorded in the third week of May of $542m (€350m) were the highest in Russia for more than two years, according to data provider Emerging Portfolio Fund Research.

Peter Halloran, chief executive of Russian hedge fund group Pharos Financial, said: “So far, their partnership has been smooth. There has been no discord and they are moving ahead with the reform agenda, which is the trick with emerging markets. It will take at least a year if we are going to see any friction between the two.”

Most investors agree the new order has yet to result in any tangible change to the investment climate due to the continuity in policies and the Government’s team.

Putin unveiled his new cabinet, handing key roles to heavyweight economic liberals, while keeping several hardliners with a secret services background on board.

Yulia Tseplayeva, chief economist at Merrill Lynch in Russia, said the early running indicated Putin was focusing on geopolitics while Medvedev was taking care of institution-building.

She said: “The transfer from Putin to Medvedev hasn’t taken place yet. It’s been a transfer from Putin to Putin-Medvedev. Putin is the main decision-maker and his significant presence is very obvious through the mass media, and the public doesn’t see any difference. It’s essentially the same team, the same policies without any major revisions.”

The best-performing sector over the past month has easily been energy, which was fired up by Putin’s statement that the tax regime in the oil sector would be eased by August. Russian Energy giants Rosneft, Surgutneftegaz, Lukoil, Gazpomneft, Transneft and Novatek rallied by between 23% and 26% last month, after the sector had failed to be swept up by the boom in global oil prices.

Tseplayeva added: “The Government could no longer afford to ignore the oil lobby as its main taxpayer. The plan to cut mineral extraction taxes for the oil sector was announced a year ago but Putin dressed it up in a very investor-friendly way and the markets responded in kind. The 100bn roubles (€2.7bn) a year will be good for the industry but it’s only 0.2% of overall GDP.”

Goldman Sachs reacted by raising its 12-month estimate for the RTS index by 12% to 2750, recommending energy blue-chips. Oil and gas stocks are expected to continue to thrive on the back of the decision to cut taxes, although it might mean other sectors have to take up the slack.

Chris Weafer, chief strategist at financial services group UralSib, believes the mining industries such as coal and metals could be most at risk. He said: “This year, there is less pressure to levy higher taxes to compensate the budget as the oil price is well above the average assumed in the budget. We believe the finance ministry could easily afford to give up $20bn to the oil industry.
“But the ministry will not want to have to bet on the oil price every year and will undoubtedly push hard for the oil tax reduction to be balanced with higher taxes on other parts of the country’s extractive industries.”

The steel sector has also been hit by suggestions the Government is considering higher export duties on steel to compensate for lost revenues from lower oil taxes.

Producers have enjoyed a surge in steel prices, pushing up costs in industries that use the metal in their production. Analysts said the losers would be companies such as Severstal, Magnitogorsk Iron & Steel Works and NLMK.

With the restructuring of the electricity grid UES almost complete, several Russian funds are betting that hydro-electricity company RusHydro will become the new proxy for the sector.

Last month, the RTS was up 15.9% while the Micex exchange’s index was ahead by 15.5%. While the lion’s share of the upside came from oil and gas, financial stocks also powered ahead with the financials index up 10.2%. Fund managers are bullish on banking blue-chips VTB and Sberbank, which have both flagged in value since their combined $18bn listings last year.

Listed construction and real estate developers have also shown signs of life after the Government approved a $570bn programme to overhaul and expand the country’s transportation infrastructure over the next seven years.

The latest GDP data shows household consumption up 13.6% in real terms during late 2007, which helps explain the continued boom in the consumer economy. Investors are keen on Russia’s second-largest retailer Magnit, which raised $490m in an April listing on the London Stock Exchange to fund expansion.

Tseplayeva said: “The consumption boom is shifting away from Moscow to regional cities such as Ekaterinburg, Novosibirsk, Krasnoyarsk and St Petersburg. Food retailers such as Magnit are primed to do well.”

All signs are that the drought of flotations experienced in the first quarter is over. Last month there was the $449m listing by freight operator Globaltrans and the $1.2bn flotation by retail group X5.
In the global capital markets, Russian companies are eyeing an expanding role. Medvedev has called on business leaders to embark on a foreign acquisition spending spree to boost technological expertise and to diversify into new markets.

Russian business conglomerate Sistema has opened its cheque book in foreign markets by taking a majority stake in Indian telecoms operator Shyam Telelink. Russian companies in the metal and steel sectors such as Severstal and Evraz have also begun to invest globally and extend their reach.

Stephen Cohen, chief executive of Troika Dialog’s fund management business, warned this trend could be to the detriment of capitalising on domestic growth. He said: “Return on equity remains high in Russia and as domestic growth remains very strong it may not be easy for Russian companies to find investment opportunities outside Russia that are as attractive as the domestic opportunities.

“Plus buying foreign companies per se does not necessarily reduce reliance on foreign technology. The solution to that problem is probably more to do with greater expenditure at home on research and development and on education and direct hiring of foreign personnel to work in Russia.”

Medvedev’s call has been answered by state-controlled companies such as savings giant Sberbank, which is looking to acquire banks in the Commonwealth of Independent States, eastern Europe and China.

Alexander Kotchoubey, managing director of Renaissance Investment Management, which has more than $6bn in assets under management, said: “Sberbank and VTB are immune to the international credit crisis because of their minimal exposure to sub-prime and they might be able to pick up distressed assets on the cheap in foreign markets.”

Alexei Miller, chief executive of state-controlled Gazprom, announced in late May that the energy giant is aiming to have the largest market capitalisation in the world. Gazprom, which recently overtook China Mobile to become the third-largest global company, is believed to be interested in taking control of TNK-BP, the Anglo-Russian venture.

TNK-BP’s Russian shareholders are embroiled in an ownership dispute with their British counterparts, which analysts say has been caused by Kremlin pressure on both groups to sell out to a state-controlled company. Investors believe events surrounding TNK and Shell’s surrender last year of the Sakhalin-2 project contribute to the wariness among European and US legislators about Russian investment in their countries.

Weafer said in a note: “Prime Minister Putin late last year said the Government believes approximately $50bn of potential Russian investment into Europe is being blocked because of these worries.”

At the economic forum showcase in St Petersburg at the beginning of June, investors were looking for specifics on how the Government plans to progress reforms and investment plans declared before the parliamentary and presidential elections.

Kotchoubey said: “There hasn’t been a clear delineation of how power should be shared between Putin and Medvedev. Investors are aware that the immaculately turned out double-headed eagle hasn’t had its feathers preened yet.”


]]> http://www.straightstocks.com/investing-in-russia-stocks/russia%e2%80%99s-stocks-rally-as-putin-passes-the-presidency-to-medvedev/feed/ 0 Russian banks caught in talent war http://www.straightstocks.com/investing-in-russia-stocks/russian-banks-caught-in-talent-war/ http://www.straightstocks.com/investing-in-russia-stocks/russian-banks-caught-in-talent-war/#comments Wed, 18 Jun 2008 12:21:00 +0000 Jason Corcoran tag:blogger.com,1999:blog-7619541933410184333.post-3794172411847560653 Financial News

Jason Corcoran in Moscow

16 June 2008


A dwindling stock of investment bankers and growing demand for talent is driving the latest hiring merry-go-round in Russia’s capital markets.

Competition between bulge brackets and domestic banks has been exacerbated by Russia’s VTB moving into investment banking. The state-controlled bank has hired 60 bankers from Deutsche Bank and the German institution has in turn responded by hiring analysts and bankers from US and European banking rivals in Moscow, including Citigroup, UniCredit, UBS and ING.

Dmitry Vinogradov, head of research, strategy and banking at Citigroup in Moscow, has moved to UBS and co-head of equity research Mikhail Selezenev and equity sales director Sergei Suverov have left to join Deutsche Bank.

This follows the departure in February of Citigroup’s former Russia country head Stuart Harley, who set up the bank’s Russian business in 2004 and is on a sabbatical. He was asked to relocate full-time to Moscow from London last year but declined.

Nick Harwood, head of equities for central and eastern Europe, the Middle East and Africa at Citigroup, said the bank had increased its Moscow staff despite a number of defections.

It has hired John Heisel as an equity sales trader, Elina Ribakova as an economist, oil analyst Ildar Khaziev and Konstantin Korotich as chief administrative officer of Russian equities.

A Citigroup spokesman said: “Russia remains our biggest equities business in Ceema which we will continue to invest in. Prospects for the remainder of the year look good with a strong equity capital markets pipeline in particular.”

Italian banking group UniCredit, which acquired Russian brokerage Aton 18 months ago, has hired an executive director from Goldman Sachs to co-head its investment banking business with Alexander Kandel. Amiran Kanchaveli previously worked at ABN AMRO alongside the Prime Minister of Georgia, Vladimir Gurgenidze.

UniCredit is shaking up its Moscow business following its acquisition of Aton. A senior source said half of the bankers from its debt and credit team would be let go and 20 middle and back-office staff would be cut.

Russia’s capital markets have been largely insulated from the global credit crunch. A total of 306 M&A deals worth $51.3bn have been conducted this year, according to data provider Thomson Reuters. That represented an increase on the same period last year when 301 deals worth $46bn were conducted.

M&A has filled the void left by ECM, where just seven deals worth $2.23bn occurred in the first half of this year compared to 20 deals worth $22bn last year.

In debt capital markets, there were 23 issues worth $11.4bn in the first six months compared to 49 issues worth $22.5bn last year.

Russian investment funds have also benefited from the turmoil in developed markets. Russian funds have this year reported inflows of $2.7bn.

UralSib chief strategist Chris Weafer said: “Along with the $1bn invested through December last year, the total amount invested in Russia since the start of the election cycle on December 2 is $3.7bn. That compares with only $300m taken into these funds through the first 11 months of last year.”]]> http://www.straightstocks.com/investing-in-russia-stocks/russian-banks-caught-in-talent-war/feed/ 0 Russian banks caught in talent war http://www.straightstocks.com/investing-in-russia-stocks/russian-banks-caught-in-talent-war/ http://www.straightstocks.com/investing-in-russia-stocks/russian-banks-caught-in-talent-war/#comments Wed, 18 Jun 2008 12:21:00 +0000 Jason Corcoran tag:blogger.com,1999:blog-7619541933410184333.post-3794172411847560653 Financial News

Jason Corcoran in Moscow

16 June 2008


A dwindling stock of investment bankers and growing demand for talent is driving the latest hiring merry-go-round in Russia’s capital markets.

Competition between bulge brackets and domestic banks has been exacerbated by Russia’s VTB moving into investment banking. The state-controlled bank has hired 60 bankers from Deutsche Bank and the German institution has in turn responded by hiring analysts and bankers from US and European banking rivals in Moscow, including Citigroup, UniCredit, UBS and ING.

Dmitry Vinogradov, head of research, strategy and banking at Citigroup in Moscow, has moved to UBS and co-head of equity research Mikhail Selezenev and equity sales director Sergei Suverov have left to join Deutsche Bank.

This follows the departure in February of Citigroup’s former Russia country head Stuart Harley, who set up the bank’s Russian business in 2004 and is on a sabbatical. He was asked to relocate full-time to Moscow from London last year but declined.

Nick Harwood, head of equities for central and eastern Europe, the Middle East and Africa at Citigroup, said the bank had increased its Moscow staff despite a number of defections.

It has hired John Heisel as an equity sales trader, Elina Ribakova as an economist, oil analyst Ildar Khaziev and Konstantin Korotich as chief administrative officer of Russian equities.

A Citigroup spokesman said: “Russia remains our biggest equities business in Ceema which we will continue to invest in. Prospects for the remainder of the year look good with a strong equity capital markets pipeline in particular.”

Italian banking group UniCredit, which acquired Russian brokerage Aton 18 months ago, has hired an executive director from Goldman Sachs to co-head its investment banking business with Alexander Kandel. Amiran Kanchaveli previously worked at ABN AMRO alongside the Prime Minister of Georgia, Vladimir Gurgenidze.

UniCredit is shaking up its Moscow business following its acquisition of Aton. A senior source said half of the bankers from its debt and credit team would be let go and 20 middle and back-office staff would be cut.

Russia’s capital markets have been largely insulated from the global credit crunch. A total of 306 M&A deals worth $51.3bn have been conducted this year, according to data provider Thomson Reuters. That represented an increase on the same period last year when 301 deals worth $46bn were conducted.

M&A has filled the void left by ECM, where just seven deals worth $2.23bn occurred in the first half of this year compared to 20 deals worth $22bn last year.

In debt capital markets, there were 23 issues worth $11.4bn in the first six months compared to 49 issues worth $22.5bn last year.

Russian investment funds have also benefited from the turmoil in developed markets. Russian funds have this year reported inflows of $2.7bn.

UralSib chief strategist Chris Weafer said: “Along with the $1bn invested through December last year, the total amount invested in Russia since the start of the election cycle on December 2 is $3.7bn. That compares with only $300m taken into these funds through the first 11 months of last year.”]]> http://www.straightstocks.com/investing-in-russia-stocks/russian-banks-caught-in-talent-war/feed/ 0