French lender BNP Paribas has agreed to a
joint venture with Russia’s largest bank by assets, Sberbank.
The agreement comes a month following rumours
that Sberbank had set its eyes on BNP Paribas’ Russian retail
banking arm Cetelem in May.
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The two banks will offer consumer loans in
retail stores across Russian and expect to grab a 30% share in the
market within the next two to three years.
The banks are expected to venture into the
retail loans market in early 2012 and are betting on the success of
the venture due to low interest rates.
The joint venture is a case of “if you can’t
beat them, join them”: HSBC and
Barclays have already announced their retreat from the Russian
retail banking sector, one which is dominated by the country’s
state-owned lenders such as Sberbank.
HSBC sold its Russian retail business in mid-June to Citi, who
has a stronger foothold in Russia as it has been present there
since 1993 – unlike Barclays and HSBC, who entered the market in
2008 and 2009 respectively.
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By GlobalDataIn contrast, BNP Paribas’ domestic competitor
Société Générale owns 74.8% of Rosbank.
Frederick Oudéa, SocGen CEO, told an investor
conference in the US on 9 June, that the bank was targeting a top
three position in international retail banking within Russia and
Central and Eastern Europe by 2015.
