Identifier
Created
Classification
Origin
08VILNIUS407
2008-05-28 14:09:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Vilnius
Cable title:
BELARUS: BANKING SECTOR OPEN FOR INVESTMENT
how-toVZCZCXRO5061 RR RUEHAG RUEHAST RUEHBW RUEHDA RUEHDF RUEHFL RUEHIK RUEHKW RUEHLA RUEHLN RUEHLZ RUEHPOD RUEHROV RUEHSR RUEHVK RUEHYG DE RUEHVL #0407 1491409 ZNR UUUUU ZZH R 281409Z MAY 08 FM AMEMBASSY VILNIUS TO RUEHC/SECSTATE WASHDC 2345 INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE RUEATRS/TREASURY DEPT WASHDC
UNCLAS VILNIUS 000407
AMEMBASSY MINSK SENDS
SENSITIVE
SIPDIS
E.O. 12958: N/A
TAGS: EINV PGOV PREL BO
SUBJECT: BELARUS: BANKING SECTOR OPEN FOR INVESTMENT
UNCLAS VILNIUS 000407
AMEMBASSY MINSK SENDS
SENSITIVE
SIPDIS
E.O. 12958: N/A
TAGS: EINV PGOV PREL BO
SUBJECT: BELARUS: BANKING SECTOR OPEN FOR INVESTMENT
1. (U) According to various news agencies in Georgia and Belarus,
Georgia's largest private bank "Bank of Georgia" announced May 13
that it had signed an agreement to purchase a 70 percent stake in
the private Belarusian Popular Bank. Reportedly, the USD 34.2
million deal also allows the purchase of the remaining 30 percent of
shares over the next three years. Under the agreement, the
Belarusian bank will continue operations under its own name, though
it will be controlled by its main shareholder.
2. (U) Belarus' government pursues a generally selective and
inconsistent foreign investment policy. The country's banking
sector, however, is ostensibly more open and conducive to such
investments. Belarus National Bank Pyotr Prokopovich told a news
conference May 15 that his office would not hesitate to remove 25
percent limit on a foreign share in the aggregate charter fund of
the country's banking sector if and when necessary. As of May 1,
the share was 14.7 percent as compared to 9.8 percent on January 1.
3. (U) Prokopovich also advised that Germany's Commerzbank is
interested in purchasing a controlling stock in one of Belarus'
largest banks Belinvestbank. The deal, which may be finalized later
this year, is contingent upon a five-fold increase in the bank's
assets to Euro 5 billion by 2010. A few other biggest Belarusian
banks are currently negotiating sales of some of their stocks to the
unnamed world's largest banks. Some of Russia's major banks have
purchased and currently negotiate purchases of big Belarusian banks.
Comment
--------------
4. (SBU) Post approached its major economic contacts for a comment
on the current banking investment policies. The general opinion is
that the banking sector is somewhat more open than the rest of the
economy. GOB policies reflect a thirst for USD 50 million loans and
above to finance major projects, as the country's banks are not
well-resourced enough to afford that. Secondly, Lukashenko seems to
be less nervous about the privatization of banks than about the
privatization of industry and agriculture. Finally, our sources
believe that the GOB and the National Bank are harbor at least some
progressive-minded people who support reform of Belarus'
command-style economy.
MOORE
CLOUD
AMEMBASSY MINSK SENDS
SENSITIVE
SIPDIS
E.O. 12958: N/A
TAGS: EINV PGOV PREL BO
SUBJECT: BELARUS: BANKING SECTOR OPEN FOR INVESTMENT
1. (U) According to various news agencies in Georgia and Belarus,
Georgia's largest private bank "Bank of Georgia" announced May 13
that it had signed an agreement to purchase a 70 percent stake in
the private Belarusian Popular Bank. Reportedly, the USD 34.2
million deal also allows the purchase of the remaining 30 percent of
shares over the next three years. Under the agreement, the
Belarusian bank will continue operations under its own name, though
it will be controlled by its main shareholder.
2. (U) Belarus' government pursues a generally selective and
inconsistent foreign investment policy. The country's banking
sector, however, is ostensibly more open and conducive to such
investments. Belarus National Bank Pyotr Prokopovich told a news
conference May 15 that his office would not hesitate to remove 25
percent limit on a foreign share in the aggregate charter fund of
the country's banking sector if and when necessary. As of May 1,
the share was 14.7 percent as compared to 9.8 percent on January 1.
3. (U) Prokopovich also advised that Germany's Commerzbank is
interested in purchasing a controlling stock in one of Belarus'
largest banks Belinvestbank. The deal, which may be finalized later
this year, is contingent upon a five-fold increase in the bank's
assets to Euro 5 billion by 2010. A few other biggest Belarusian
banks are currently negotiating sales of some of their stocks to the
unnamed world's largest banks. Some of Russia's major banks have
purchased and currently negotiate purchases of big Belarusian banks.
Comment
--------------
4. (SBU) Post approached its major economic contacts for a comment
on the current banking investment policies. The general opinion is
that the banking sector is somewhat more open than the rest of the
economy. GOB policies reflect a thirst for USD 50 million loans and
above to finance major projects, as the country's banks are not
well-resourced enough to afford that. Secondly, Lukashenko seems to
be less nervous about the privatization of banks than about the
privatization of industry and agriculture. Finally, our sources
believe that the GOB and the National Bank are harbor at least some
progressive-minded people who support reform of Belarus'
command-style economy.
MOORE
CLOUD