Russian Post, the state-run postal service, has agreed to acquire a stake worth RUB5.5bn ($71m) in VTB Group’s subsidiary Leto Bank.
Under the terms of the deal, Russian Post will purchase a stake of 50% minus one share in Leto Bank from VTB 24, VTB’s retail banking unit.
The deal will create a new venture Post Bank, which is expected to commence operations in 2016. It will offer banking services using the 42,000 offices operated by Russian Post.
With such strong branch network, Post Bank will be in a strong position to compete with Sberbank, which operates with nearly 17,000 branches throughout the Russia.