Hundreds of Russian banks could go bankrupt by the end of this year, said Peter Aven, president of Alfa Bank. The main reason for bankruptcy is than the level of bad loans may hit 15-20 percent. Peter Aven hopes that about 20-30 major Russian banks will receive the support from the Russian government.
"We can expect that the level of overdue loans for the whole system might reach 15-20 percent by the end of the year," said Aven in interview with the Financial Times .
"Maybe the 20-30 biggest banks, including Alfa, will receive state support - we're sure. But the future of hundreds of small banks is under big question... I believe that hundreds of banks will disappear by the end of the year," he said.
Russian banks can count on further state help, possibly seeing all profits erased in 2009 if bad loans rise to 10 percent. This could force them to make provisions of $45 billion, Russia officials said earlier this week.
Russia Finance Minister Alexei Kudrin said Thursday that, in reality, overdue loans are at around 10 percent already, Reuters reports.
Russia 's 1,200-plus banks have been hit hard by the credit crunch, the rouble's depreciation, a collapse in domestic stock markets and the first recession in a decade.”