CBR sells majority stake in Sberbank to the Russian government

The sale, announced last February (BOFIT Weekly 13/2020), took place last Friday (April 10). The transaction was originally set to take place in several tranches, rather than all at once, and the price of stake (50 % plus one share) was expected to be around 2.5 trillion rubles. However, with the general decline in share prices, the final price of the acquisition was just 2.139 trillion rubles (about 28.5 billion dollars). Sberbank, Russia’s largest bank, accounts for about a third of Russia’s entire banking sector.

The transaction resolves the Central Bank of Russia’s long-running potential conflict of interest in holding the controlling interest in Russia’s largest bank. For the government, the greatest value of the transaction is the huge boost it gives to the CBR’s distributable funds. The CBR is obliged to surrender its profits to the government, which can then spend the money unfettered by the current fiscal rule. Sberbank’s stake was acquired with assets from the National Welfare Fund, which in turn saw a decrease in its assets invested in highly liquid securities. The value of transaction corresponds to roughly 2 % of Russia’s 2019 GDP.