#10 - JRL 7205
Russian banks reluctant to list shares-central bank
MOSCOW, June 2 (Reuters) - Russian banks are reluctant to list their shares on the stock exchange because their owners fear throwing open their books and may also lose money in the process, Russia's Central Bank governor said on Monday.
At present only shares in state savings bank Sberbank are traded on the Moscow stock exchange.
"Only Sberbank shares are traded now and this is a serious problem," Sergey Ignatiev told an annual investors' conference.
"We are very interested in seeing stocks of other banks traded in the Russian market," said Ignatiev.
Russian banks have lagged behind the corporate sector in adopting international accounting standards (IAS) to replace what are seen as often murky local accounting methods.
"I think the main difficulty is that the management of the banks as well as the owners are not ready yet to make their banks absolutely transparent and probably they do not want to lose profits," he added.
"Under certain circumstances floating banks might reduce the level of dividends the owners are enjoying," said Ignatiev.
From next year banks will be required to present both Russian and IAS accounts and from 2007 only international accounting will be accepted.
Russian banking is widely seen as underdeveloped and lagging behind the growth of the overall economy.
Bank assets currently account for 37 percent of gross domestic product compared with 70 percent in Eastern Europe and 120 percent in Britain, Stephen Jennings, CEO of investment bank Renaissance Capital earlier told the conference.
Economists believe Russia needs to establish an open and competitive banking industry in order to raise the sustainable rate of growth of the economy.
While Russia's economy is expected by many analysts to expand at a healthy 5-6 percent this year that is still well short of the high growth rates over many years that hauled Asian economies out of poverty onto the road to prosperity.
Ignatiev said a bill calling for introduction of deposit insurance in Russia was before the state Duma but had not yet had its first parliamentary reading.
At present only Sberbank enjoys deposit insurance, giving it a competitive edge over its privately owned rivals.
Ignatiev said the draft law called for audits of banks which wanted to take part in the deposit insurance system.
"Verifications will also assist in strengthening the bank sector in this country," he added.