Foreign banks in Russia manage to work more efficiently than Russian credit institutions. The profitability of foreign banks is higher than that of domestic ones. This is largely due to the bank's more stringent cost control policy. Also, many subsidiary banks can be fed from the main bank, which allows them to operate more steadily in the banking market.
The state is not happy with this state of affairs. Therefore, in order to maintain and develop the Russian banking system, a bill banning the opening of representative offices of foreign banking organizations in Russia has been submitted to the government. The adoption of such a bill could reduce the influx of foreign investment into the banking sector. Let's consider foreign banks with 100% participation of foreign capital, which are prominent representatives in the Russian banking market.
Foreign banks and representative offices in Russia with foreign capital participation
Yapi Credit Bank Moscow is considered one of the oldest foreign banks in the country. It is 99.843% owned by the main bank in Turkey. Its history begins in 1988, when the Turkish bank opened its representative office in Moscow. Since 1993, the bank was one of twelve banks that received a License for banking activities in Russia. It has firmly taken its place in the Russian banking system and still offers many services in the banking sector, both to corporate clients and individuals. It was not affected by the 1998 crisis; rather, on the contrary, the bank acted as a reliable financing partner, which only allowed it to strengthen its position in the market.
Deutsche Bank is one of the largest banks in Germany. In Russia it has its own representative office in Moscow. In it, 40% of the shares of OFG Invest CJSC belong to Deutsche Bank. However, it does not provide services to private clients other than wealth management. The main area of activity is the provision of banking services to corporate clients and management of large capitals. At the same time, in addition to all banking services, individual consulting is provided.
Since 2004, a representative office of GE Money Bank has been operating in Russia. The bank provides consumer lending services. By entering the Russian deposit insurance system, the bank meets all the requirements of the Central Bank of Russia. Combining modern foreign instruments and Russian realities, the bank is attractive to consumers not only for its offers, but also for its great popularity all over the world.
The most popular banks with 100% foreign capital participation
Raiffeisen Bank is one of the representatives with 100% participation of foreign capital. It is a subsidiary of the Austrian banking group Raiffeisen. The bank has been operating in Russia since 1996 and provides a full range of services to corporate and private clients, both in foreign currency and in Russian rubles. In 2006, the Austrian Raiffeisen group acquired one hundred percent of the shares of OJSC IMPEXBANK. Today Raiffeisen Bank is one of the most reliable banks in the country. This is confirmed by many factors, for example, the bank has been assigned a high credit rating and reliability rating.
UniCredit Bank has been offering its services on the Russian market since 1989 with 100% participation of foreign capital represented by the shareholder of the Austrian bank UniCredit Bank Austria AG. It is one of the leaders in the domestic banking services market. Offers clients a wide range of banking services. Serves private and corporate clients. Attracts clients with an individual and respectful approach, as well as quality services.
Societe Generale Bank is a 100% foreign bank represented by the main shareholder of the Societe Generale group. It occupies a strong position in the Russian market. It was founded in 1993, and today has representative offices in eleven regions of the country. The bank offers potential clients a large selection of banking offers and services. Serves both private and corporate clients. The bank offers bank cards for depositing salaries, as well as business cards to simplify payments abroad and in Russia. We also offer various types of loans for private clients and financing programs for corporate clients. The bank has various awards and titles received in various years for the quality provision of services. The bank takes a strong position in the Russian market, offering its clients quality services. Representative offices of the bank are open in Nizhny Novgorod, Moscow, Ufa, St. Petersburg, Yekaterinburg and a number of other large cities in Russia.
Which bank to choose
Having decided to use a banking service, the question of choosing a bank arises. Many private clients have no question about which bank it is, Russian or foreign. Studying offers and terms of service comes first. As a rule, Russian banks are more adapted to the realities of the domestic market, but at the same time, they can offer a smaller number of banking services, while representative offices of foreign banks, relying on the support of the parent bank and its experience, can offer a larger number of quality services. When choosing between foreign and domestic banks, you should remember that most domestic banks operate in limited regions, which reduces consumer opportunities when traveling around the country and even more so outside its borders.
When choosing a foreign bank, you should study not only its history of activity in Russia, but also the history of the main bank located abroad. This will help you form an objective opinion about the quality of the services offered and the reliability of the bank. Valuing their reputation, foreign banks very carefully monitor the activities of their representative offices in Russia. At the same time, the level of services offered to clients must correspond to the level of a foreign bank. All this leads to the provision of better services. Thus, foreign banks try to attract customers and retain them, trying to consolidate their positions in the market. However, it is necessary to remember that when choosing a foreign bank, you are giving away your money, which begins to work for a foreign state.
Banks with foreign participation– foreign credit organizations that operate in Russia. There is only one form of such participation - through a subsidiary Russian bank. The Federal Law “On Banks and Banking Activities” does not allow foreign credit organizations to open representative offices and branches on the territory of the Russian Federation.
At the same time, the law requires notifying the Bank of Russia when a foreign legal entity or individual purchases a share in a credit institution from 1% to 10%. And for a larger package it is necessary to obtain permission from the Central Bank.
The arrival of foreign banks in Russia began to gain momentum in the early 2000s, when the economy began to stabilize. In 2003, the share of foreign capital in the Russian banking system was about 5%. By 2006, foreign banks had an interest in 149 credit institutions, while 51 banks were entirely owned by foreigners. The share of foreign capital in the Russian banking system exceeded 11%.
The peak of expansion of international financial organizations into Russia occurred in pre-crisis 2008, when 28.5% of the total equity capital of banks was accounted for by foreigners. However, the onset of the international financial crisis led to a general closure of investment projects. At the end of 2010, the share of foreigners in the domestic banking system decreased to 28%, and by mid-2011 - to 27%. As of the fall of 2011, the assets of credit institutions owned by foreign investors accounted for no more than 18% of total assets. In total, about 200 organizations with foreign participation have a license to carry out banking operations. 142 of them are located in Moscow, 13 in St. Petersburg.
Analysts identify two reasons for the decline in the activity of foreign banks in Russia: firstly, the problems of parent credit institutions associated with the crisis in the economies of developed countries, and secondly, fierce competition in the Russian market, primarily with banks with state participation.
Credit institutions such as the Dutch Rabobank Groep NV, one of the world leaders in car loans, and Morgan Stanley have left the Russian market altogether. The Scandinavian Swedbank, the British banking group Barclays and the Belgian KBC group announced their intentions to sell their subsidiaries in the Russian Federation. One of the largest European banks, HSBC, abandoned its retail business in Russia, preferring to work with corporate clients.
At the same time, a number of credit institutions with foreign participation are successfully developing their Russian business. The most famous subsidiary banks of foreign financial institutions are Citibank, Raiffeisenbank, UniCredit Bank, OTP Bank, etc.
As a rule, the tariffs and packages of services they offer approximately correspond to the offers of completely Russian banks.
Foreign banks in Russia are attractive to potential investors and are becoming increasingly popular. Experts explain this by the fact that the Russian financial and banking system does not inspire confidence in the population - at the moment the country's economy is not in the best condition. But at the same time, domestic banks are still in leading positions in the rating indicators of financial organizations of the Russian Federation.
Foreign banks operating in Russia offer investors favorable terms of cooperation. A list of the most popular of them is presented below.
Basic information
Current domestic legislation states the following: the opening of branches of non-Russian banking institutions on the territory of the Russian Federation is prohibited. At the same time, it is allowed to launch subsidiaries within the Russian Federation - their part of the capital belongs to residents of other states. Such organizations with foreign capital operating within the borders of the Russian Federation must comply with the legislation of the Russian Federation and obey the domestic Central Bank.
Thus, formally international banking institutions do not have branches in Russia. However, many subsidiaries of non-Russian financial institutions have been opened - a list of them is discussed below.
Foreign banks in Russia: the most popular in 2018
Currently, there are 69 commercial enterprises operating in the country. The founders' funds are the property of foreign financial groups. Many of them cooperate only with legal entities.
1. UniCredit Bank
The institution began operating in 1989 and at that time was called the International Bank of Moscow.
In 2007 its name was changed - UniCredit Bank. The institution is part of the largest banking network, which includes 22 countries in Europe. It occupies 12th position in rating indicators. Legally, the company is located in Italy, Rome.
UniCredit Bank is the first organization to receive a license to conduct financial activities within the Russian Federation from the Central Bank.
2. Raiffeisen Bank
It was formed in the 19th century, and began to function in Russia only in 1996. Legally, the organization is located in Austria, Vienna. As for the headquarters of the enterprise, it operates in Moscow.
Both legal entities and ordinary citizens cooperate with the organization. In the rating indicators, the company is assigned 13th position.
3. Rosbank
It is a subsidiary of the French Financial Group. It launched its work in Russia in 1998. The foreign financial group owns the vast majority of shares, so it completely controls the work of a commercial banking organization in the Russian Federation.
4. Citibank
American banks are represented in the Russian Federation by a subsidiary of Citibank. The organization appeared in the USA in 1812; in Russia it received a general license in the fall of 2001.
Citibank cooperates with both organizations and ordinary citizens. The company is assigned 21 positions in the rating indicators.
The headquarters of Citibank is located in the capital of the Russian Federation.
5. Home Credit Bank
This is a leading enterprise in issuing consumer loans to individuals. Its owner is the international Amsterdam financial group PPF. In the Russian Federation, the institution launched its work in 2002.
Initially, the institution's specialization was processing targeted lending at retail outlets. In 2002, the organization formalized an agreement with Eldorado, 2 years later announced the first issue of credit cards, and a year later the institution had its first office branch. At the same time, the bank began offering consumer loans to clients.
6. OTP Bank
The owner of the organization is the Hungarian financial group OTP Group. In the Russian Federation, the organization began its work in 2008, and in 2009 it took second position in processing consumer loans.
7. Rusfinance-Bank
In the Russian Federation, this banking organization is not particularly popular among Russians - in rating indicators it is given only 63rd place. The bank specializes in issuing credit cards, car loans, and consumer loans. About 7 years ago, the institution took first place in the number of issued car loans. This is one of the most serious and largest institutions that deal with car loans.
8. Credit Europe Bank
9. Deltacredit
The banking institution specializes in mortgage lending. It began its work in Russia in 1998, and in 2005 it was added to the French financial group. The full owner of the bank's shares is PJSC Rosbank.
Other bank subsidiaries in Russia
There are other subsidiaries of foreign banking organizations operating within the Russian Federation.
Foreign banks operating in Russia include the following:
- Toyota-Bank (Japanese bank);
- Plus-Bank (an institution established in Kazakhstan);
- Mercedes-Benz Bank Rus (German institution);
- Commerzbank (Eurasia);
- Volkswagen Bank Rus (German institution);
- Bank of China (Chinese enterprise).
Is it possible to get a loan abroad?
Loans from foreign banks have a low interest rate. So, if you take out a mortgage in the USA or European countries, its size will be about 5-6%, and a consumer loan will cost 7-10%.
Unfortunately, such favorable conditions at a percentage rate do not apply to subsidiaries of foreign countries operating within the Russian Federation. Such banks are guided by the peculiarities and rules of the Russian market.
As for obtaining a loan abroad, foreign banks prefer to work either with citizens of their country, or with foreigners who have officially resided in the territory of their state for a long time, are employed, etc.
This mistrust of Russians can be explained as follows. A potential borrower applies for a loan in one state, and if any controversial situation arises, it will be considered according to the laws of his home country. As a result, few Russians have the opportunity to become a client of a foreign banking organization.
However, those people who live abroad permanently or have a residence permit have a good chance of getting approval from foreign banks. Citizens of the Russian Federation who conduct business abroad also have the opportunity to obtain a loan.
Attention! According to the laws of some European countries, a person who has purchased real estate abroad, rents it out and pays taxes to the country, automatically becomes an entrepreneur.
There are two courses of action for those who plan to become a client of a foreign bank:
- send applications by e-mail to foreign banks (they will need to be written in English);
- study thematic forums on the Internet, find those who managed to get a loan from a foreign banking organization.
Thus, those people who open a deposit in a foreign bank have a high chance of getting a loan from the same bank.
In addition, one should take into account the following disadvantage: if you want to spend credit funds in Russia, you will need to pay the commissions that are charged for an international money transfer. The loan funds will attract the attention of the Russian tax inspectorate. As a result, total cash costs may outweigh the advantage of low interest rates on loans issued in foreign banking organizations.
Let's sum it up
Foreign banking organizations are of interest to Russians. Increasingly, they are beginning to pay attention to offers from subsidiaries of foreign banking institutions. However, rating indicators for the reliability of organizations indicate that Sberbank, VTB24, Rosselkhozbank and other domestic institutions are among the ten most reliable financial organizations in the Russian Federation.
Foreign organizations operate successfully on the territory of the Russian Federation and do not plan to move from the domestic lending market. The enterprises are strengthening their positions in the Russian market and are expanding their branch network.
As for the foreign banks themselves, they are more willing to cooperate with citizens of their country or with foreigners who have been living in the territory of their state for a long time.
In July, the license of the financial institution was revoked. Meanwhile, practice shows that such lawsuits do not end well for the former owners of credit institutions and the chances of winning are zero. However, this time it is not so simple. The fact is that the lawsuit was filed by David Gaon, a representative of the rather famous Gaon family, which became famous for many years of litigation with Russia over a contract for the supply of food in exchange for oil. News.ru figured out which of the top 50 Russian banks are related to foreign financial institutions.
It is important to understand that credit organizations with foreign capital are fully subject to Russian legislation. Foreign participation means that a certain block of shares in the bank belongs to a foreign owner. Foreign banks cannot directly open their branches in Russia; they can own a Russian legal entity and operate in the format of a “subsidiary” organization.
UniCredit Bank is the largest bank in Russia with foreign capital. All voting shares of the bank belong to the Austrian division of the Italian financial group UniCredit. Has been working in the Russian Federation since 1989. Initially it was called the International Moscow Bank (IMB). It is noteworthy that it was the first Russian credit and financial organization with Western capital. Its founders were five foreign banks: Bayerische Hypo- und Vereinsbank (HVB), Creditanstalt-Bankverein, BancaCommercialeItaliana, CreditLyonnais and Kansallis-Osaki-Pankki. Currently, the credit institution is actively developing its branch network and retail business. One of the main areas of the bank's work is also servicing companies. It has 13 branches, 12 representative offices in Russia and one in Belarus, as well as more than 60 additional and 16 operational offices. The number of employees as of July 1, 2017 was 4,540 people. The bank serves more than 27.8 thousand corporate and about 1.9 million private clients.
Global Look Press/ZUMAPRESS.com/Jaap Arriens
Raiffeisenbank ranks second in the list of largest banks with foreign owners. Today, the sole shareholder of the bank is Raiffeisen Bank International AG (100% share). Raiffeisenbank was founded in 1996 as a bank with entirely Austrian capital under the name "Raiffeisenbank Austria". The organization consists of five branches: in St. Petersburg, Yekaterinburg, Novosibirsk, Nizhny Novgorod and Krasnodar; more than 120 additional offices, two operating cash desks outside the cash desk and 54 operational offices. It serves more than 80 thousand legal entities. Plastic card owners have 1,300 ATMs at their disposal, as well as a partner ATM network (Gazprombank, Moscow Credit Bank, Rosbank, Rosselkhozbank, Uralsib, Energotransbank, UniCredit Bank). In addition, in June 2016, the bank merged its ATM network with the B&N Bank ATM network. As of July 1, 2017, the bank had 7,843 employees.
News.ru/Sergey Bulkin
In third place is Rosbank. It was founded in 1993 and was then called “Independence”. During the 1998 crisis, it was bought by the industrial and financial group Interros. Today, the holder of 99.95% of the shares is the French banking group Societe Generale. The remaining 0.05% belongs to minority shareholders. In 2017, its network included 365 sales offices. The bank provides all types of services to private clients and organizations in 70 regions of the Russian Federation. Today, 10 thousand people work here (excluding subsidiary banks and companies). In total, 4 million individuals and 80 thousand corporate clients are served.
News.ru/Sergey Bulkin
Citibank, which is in penultimate place in the top 5 Russian banks with foreign owners, arose in 1993, initially as a bank with entirely foreign capital. Citibank is a subsidiary of the American Citigroup. In Russia, it has 11 branches in Moscow, three in St. Petersburg and one in several cities with a population of over a million, such as, for example, Ufa, Volgograd, Yekaterinburg and others. In recent years, the bank has reduced its presence in Russia and cut approximately half of its offices. In 2017, more than 3,100 employees worked here. The credit institution services more than 600 thousand individuals and over 3,000 companies. For “physicists” the bank offers the following services: savings and savings accounts, deposits, loans, debit and credit cards, money transfers and others. For companies - services for transactions with securities, collection, letters of credit, lending, etc.
AGN "Moscow"/Andrey Nikerichev
Eastern Bank
Last on our list is Eastern Bank. It was founded in 1991 in the city of Blagoveshchensk, Amur Region. Currently, the shares of the financial institution also belong to foreign holders. Thus, 51.62% of the bank’s shares are owned by the Baring Vostok fund. In addition to the head office in Blagoveshchensk, the bank has eight branches in Russian cities, 129 additional offices, several operational cash desks and about 500 operational offices. The number of employees in 2017 was over 9 thousand people. For legal entities, the bank offers services: lending, corporate deposits, bank guarantees, salary projects, etc. For private clients - plastic cards, deposits, electronic services, money transfers and others.
To summarize, we would like to add that there are now several dozen banks operating in Russia with partial or full foreign capital. Among them there are both small and quite large. Some have a rather narrow specialization, in particular, they provide car lending services (for example,