Русский
Russia’s MTS Bank, the fintech arm of Russia’s leading mobile phone operator MTS, has announced plans to carry out an initial public offering of its common shares on the Moscow Stock Exchange. Investors will be offered newly issued shares, with the proceeds from the IPO used to implement the bank’s growth strategy and further scale its high-margin retail business, MTS Bank said in a press release.
“The plan to become a public company confirms that MTS Bank has entered a new stage of development. This will give additional momentum to the bank’s profitable growth and thus make it possible to create additional value for shareholders,” MTS Bank CEO Ilya Filatov said in its IPO statement. The bank’s majority shareholder, mobile provider Mobile TeleSystems (MTS) does not plan to sell any of its shares in the IPO and will retain a majority stake in the bank after the offering.
MTS Bank was Russia’s 24th largest lender by assets at the end of 2023. The bank’s net profit rose 32% to ₽3.7 billion (US$39.6 million) in the first quarter of 2024 while its retail loan portfolio totalled ₽359 billion rubles (US$3.85 billion).
The bank, its majority shareholder and parties affiliated with them are expected to commit to a lock-up period of 180 days from the start of trading on the Moscow Exchange. The IPO will have a stabilization mechanism for up to 30 days after the start of trading.
“Our own expertise in retail banking and integration with the ecosystem of Russia’s leading telecom provider create significant potential for the further profitable growth of the business and increasing our share of Russia’s retail lending market. The bank aims in the medium term to double its loan portfolio and client base (to 8 million active clients), anticipating a gradual increase in return on equity to 30%,” MTS Bank said.
The IPO will be open to qualified and unqualified investors retail and institutional investors, the bank said.
The Moscow Stock Exchange ruble-based MOEX Russia Index edged up to 3,456 on Friday (Apil 12) as a rally in industrial and precious metals continued to underpin results. Weekly, the index gained around 1.8%, driven by a surge in global commodities purchased from Russian exporters. The Index has gained 450 points since January 1. MOEX is expecting to see another 30 IPO’s over the next two months.
