Barclays to take loss in Russian deal
Tuesday 25 October 2011
Barclays is close to selling its Russian retail banking business to Igor Kim, a local banker, and will sign a deal in the next few days.
The business has been up for sale since February under a plan by Barclays' chief executive, Bob Diamond, to get out of underperforming or sub-scale businesses.
A sale would follow HSBC's decision to offload its Russian consumer banking business to Citigroup in June.
The deal could cause a heftyloss for Barclays, which paid$745m (£466m) for Expobank in Russia in March 2008. Valuations in the banking sector have since crumbled.
Barclays failed to agree a sale with Kazakhstan's Kazkommertsbank and Russia's Renaissance Credit Bank, Reuters reported. Mr Kim, whose wealth is estimated at $500m, could emerge as the winner as early as today.
Mr Kim could pay less than nine times book value for the business, compared with the four times book that Barclays originally paid.
The British bank is understood to have decided to concentrate on investment banking in Russia.
A Barclays spokesman in London declined to comment yesterday.
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