Russian News: April 29th, 2008!

RBC, 29.04.2008, Moscow 13:47:20.Sberbank’s net profit under IFRS jumped 28.6 percent to RUB 106.5bn (approx. USD 4.51bn) in 2007 compared to the previous year, the bank indicated in its financial statement. Assets amounted to nearly RUB 4.929 trillion (approx. USD 208.86bn) as of January 1, 2008, which is 42.2 percent greater than the previous showing as of January 1, 2007. The bank’s return on average assets (ROAA) stood at 2.5 percent.

RBC, 29.04.2008, Moscow 13:38:14.LUKoil’s net profit under RAS grew nearly 70 percent to over RUB 13.231bn (approx. USD 561m) in the first quarter of 2008 compared to the same period a year earlier, the Russian oil producer said in a statement. Meanwhile, net profit slid 14.4 percent from just over RUB 15.45bn (approx. USD 655m) in Q4 2007, as gross profit fell, triggered by changes in the company’s sales structure and higher export duties. Moreover, a negative revaluation of LUKoil’s long-term financial investments in terms of stocks traded on the organized securities market has also had an impact on the company’s profit.

RBC, 29.04.2008, Moscow 12:58:06.Raising the Central Bank discount rate by 0.25 percent will not have a considerable macroeconomic effect, head of the Russian Finance Ministry’s financial policy department Alexei Savatyugin told a Standard&Poors’ and VTB Bank seminar today, adding that hiking the rate by a quarter-percentage point was not that significant of an increase, and would play no major macroeconomic role. In the official’s opinion, by upgrading the rate the Central Bank is confirming that it shares the Finance Ministry’s concerns of an overheating economy and that all the monetary authorities have a common view of the macroeconomic situation in the country. Savatyugin also noted that the rate hike would send a signal to the market that the Bank of Russia was changing its trend and policy. He added that the decision would result in commercial banks raising their rates, as well.

RBC, 29.04.2008, Moscow 12:54:25.VTB’s Chairman and CEO Andrei Kostin is wary of the consequences of the recent rise in the Central Bank’s discount rate, he told journalists today. He said that he was disconcerted by the government’s anti-inflation policy focusing only on the banking sector. The government needs to find other means of curbing inflation than putting restrictions on banking activities, Kostin noted. He pointed out that the hike in the discount rate could result in higher interest rates.

RBC, 29.04.2008, Moscow 12:21:59.At the opening of today’s session on the Russian stock market, share prices remained virtually unchanged and showed no defined trend. After the first few minutes of trade on MICEX, LUKoil, RAO UES, and VTB dipped, while Gazprom, Sberbank, and Norilsk Nickel edged up. The RTS index opened in negative territory despite a slight rise in LUKoil, RAO UES, and Norilsk Nickel. Traders believe that the market will be stable today, while trading activity will be below average prior to the May holidays.

RBC, 29.04.2008, Moscow 11:59:22.Deputy Prime Minister Alexander Zhukov expects the State Duma to pass a number of draft laws in support of small businesses. Speaking during a meeting of a governmental commission for the development of small and medium businesses in Russia, Zhukov called on the deputies to pass the bills as soon as possible. Specifically, the documents include the terms of participation of small businesses in the privatization of leased state property. Furthermore, Zhukov pointed out that the Economy and Finance Ministries must present bills to the government on improving the taxation legislation for small businesses and facilitating their accounting procedures.

RBC, 29.04.2008, Moscow 10:23:40.At the opening of today’s special dollar trading session for tomorrow deals, the weighted average exchange rate stood at 23.64 RUB/USD, RUB 0.04 higher than the official rate set by the Bank of Russia for April 29. The current developments on MICEX can be traced to the dollar’s appreciation against the euro on international exchanges. The latter is now trading at USD 1.5637, down 0.13 percent from USD 1.5658 at the opening on Monday.

RBC, 29.04.2008, Moscow 09:26:41.Greece’s Prime Minister Konstandinos Karamanlis will embark on a working visit to Moscow today at the invitation of Russian President Vladimir Putin. He is expected to meet the Russian leader and President-elect Dmitry Medvedev in order to discuss an intergovernmental agreement on Greece’s joining the South Stream gas pipeline project.

RBC, 28.04.2008, Kiev 15:35:21.Ukraine has fully repaid its debt for Russian natural gas, Ukraine’s Prime Minister Yulia Timoshenko said during today’s meeting of the Russia-Ukraine intergovernmental commission’s economic cooperation committee.On April 23, Timoshenko noted that Ukraine had already earmarked the funds for the repayment of its gas debt to Russia and that it would settle the debt as soon as the two countries signed the required documents. According to Naftogaz of Ukraine’s data, the company transferred over USD 1bn for this purpose during the past week.

RBC, 28.04.2008, Moscow 19:57:43.By 2020, Russia could face a staff deficit of between 8m and 22m people, according to various estimates, Deputy Health Minister Alexander Safonov told a round table on Russia’s employment problems. He stressed that even now, the shortage was considerable, and was not only of a quantitative, but also a qualitative nature. The primary and manufacturing sectors are seeing a steep decline in staffing, while the accident rate continues to soar.

RBC, 28.04.2008, Moscow 18:28:04.Ukraine expects to sign a strategic agreement with Russia on natural gas supply and transit for ten years or more, the country’s Prime Minister Yulia Timoshenko said following today’s talks with her Russian counterpart Viktor Zubkov. The goal is stated in the minutes of the meeting of the two countries’ economic cooperation committee, Timoshenko noted. Once existing gas problems have been settled, the two countries must develop strategic cooperation, she noted, adding that such an agreement would enable the parties to estimate the openness and transparency of their gas policy.

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