What Stands Behind Proposal To Sell "Belarusbank"?

An idea to sell the largest bank in the country has been already voiced.

"Beltransgaz" has been sold - it helped to survive for couple of years. What now will Belarus sell to patch holes in the budget? An idea to sell the largest bank in the country has been already voiced.

This summer "Belarusbank" together with its owner offered to Lukashenka to sell some part of shares. It is noted that the bank gave a number of arguments in favour of this transaction - to attract new technologies, because the development of the largest Belarusian bank will determine the development of the entire banking system.

"Obviously, to enter the Russian market and to gain more profit "Belarusbank" needs a strategic investor. Money is not the objective to sell shares of the bank, moreover, if the decision on the additional money issue is adopted, the state does not receive "quick" money, and will get a time-shared income. And the "Belarusbank" is not such a great asset, like the same "Belaruskali", which could allow close problems with balance of payments and foreign exchange reserves for the next 10 years", the article of the head of the Financial and Economic Department of Belarusbank Aliaksandr Ehorau says.

According to former chairman of the National Bank of Belarus Stanislau Bahdankevich, this offer is correct, but is impossible to implement.

"Privatization of banks is the right decision. In theory, it could help the bank to receive investments, improve service quality, to give impetus to the development of the banking system. But this is in theory. In practice, it will be hard to find a buyer of a minority interest," he told in the interview to Belarusian Partisan.

According to the former head of the National Bank, it is related to the administrative-command model, which functions in the economy and in the banking system of Belarus.

"At any moment" Belarusbank "and other banks with a dominant share of the state among shareholders may be ordered to finance some notoriously unprofitable program "Rural Revival "and so on. To tell the truth, even the chairman of the "Belarusbank" is chosen not by shareholders (although it is a joint-stock company), but by the decree of the president. I do not think that there is an investor who wants to buy the asset" , the expert believes.

"Perhaps a small block of shares will be sold to "their own" companies to make the state own, foe instance, 88% of shares, thereby showing that the bank is taking a market path, but it will not change anything", Bahdanovich says.

It will be recalled that "Belarusbank" is the largest bank in Belarus. The share of "Belarusbank" in the total volume of the Belarusian banking assets sector amounted to 41.2% as of January 1, 2016, retail deposits - 45%, loan portfolio - 72% of all loans granted to the population. The state owns 99.98% shares of the bank.