Russia’s VTB sets SPO price, could raise up to $2.1 billion

MOSCOW: Russian state-owned lender VTB on Friday set the price for its secondary public offering (SPO) at 0.018225 roubles/share, implying a maximum capital raising of 169.5 billion roubles ($2.1 billion).

A total of 9.3 trillion shares with a par value of 0.01 roubles each will be placed by public subscription, VTB said. The bank expects to bounce back to profit this year after a huge net loss in 2022 as Western sanctions hit Russia’s financial sector.

CEO Andrei Kostin has presented the SPO as a means to help the bank resolve capital problems.

“Plans for the additional issue do not come as a surprise to the market,” said BCS Express analysts. “However, the announced price of the issue is 15 per cent lower than market (price). VTB shares could come under pressure this morning.”

VTB’s Moscow-listed shares fell sharply on market opening before rebounding to gain 2.4 per cent as of 1117 GMT, outperforming the wider market.

VTB said applications to buy 33.46 billion shares had been submitted under pre-emptive rights. The bank has given a more conservative estimate of how much it expects to raise — up to 120 billion roubles.

In March, VTB completed a private placement of additional shares, raising 149 billion roubles from the state, paid for in two non-cash assets including shares in Russian National Commercial Bank. That raised the state’s overall stake in VTB to 76.4 per cent from 60.9 per cent at the start of 2023.