| MOSCOW, April 25
MOSCOW, April 25 VTB Capital, the investment
banking arm of Russia's second-biggest bank VTB, said
it plans to hire five metals traders for its Hong Kong office
within the next two months as it boosts its commodity business.
The newcomers will include specialists in precious and base
metals, iron ore and coal, and will increase VTB's commodities
team to around 40 people, Atanas Djumaliev, head of global
commodities at the firm, said.
Charles Smith is joining the firm's office in Hong Kong from
Avra Commodities and will be in charge of base metals, Djumaliev
said in an interview with Reuters. He did not disclose the names
of the four others.
VTB is one of the biggest players in the Russian gold market
alongside Sberbank, Russia's biggest lender.
Precious metals will remain the main asset class within
VTB's commodities business, Djumaliev said, adding that the
priority was also to develop the firm's presence in other
gold-producing regions such as post-Soviet countries, the Middle
East and Africa.
VTB Capital plans to supply at least 15-20 tonnes of gold to
China in 2017, of which 6 tonnes have already been sent. The
firm sold around 2 tonnes of gold to China in 2016.
In 2017, it plans to export at least 20 tonnes of gold to
India, of which over 5 tonnes have already been sold, and also
at least 300 tonnes of silver. In 2016, VTB Capital's gold sales
to India totalled more than 12 tonnes, along with more than 200
tonnes of silver.
Its gold and silver come from Russian producers and
refineries and from markets including London, Zurich and Dubai.
In the Russian market, the central bank, one of the world's
largest holders of bullion, remains the biggest gold buyer and
VTB's export potential depends on the central bank's appetite.
The central bank bought 200 tonnes of gold to add to its
holdings last year, while the country, the world's third-largest
gold producer, produced 288.6 tonnes of gold over the same
In aluminium, VTB cooperates, among others, with Russia's
Rusal and Eurasian Group's Aluminium of Kazakhstan. It
also works with Greek industrial group Mytilineos's
Aluminium of Greece, Djumaliev said.
"We signed a trade contract with Aluminium of Greece at the
end of last year and are currently intermediating for them when
it comes to physical metal deliveries for German clients," he
He added that VTB was also offering a range of financial and
VTB Capital recently moved into agricultural commodities as
Russia is one of the world's top wheat exporters, with customers
mainly in North Africa and the Middle East.
Leading grain trader Hans Stoldt recently joined VTB Capital
as its director of agricultural trade in Switzerland.
"So far, we have focused on financing grain production,
storage and grains in transit. With Hans's arrival, we plan to
start physical grain trading," Djumaliev said.
He sees opportunities in several commodity-linked financial
services, including pre-payment for future crop production,
exports via its Swiss branch, being a mediator for goods in
transit, providing finance for companies that need to support
their stockpile storage, along with derivatives and hedging.
VTB Capital expects its future clients to be grain producers
and exporters in the Black Sea region of Russia and southeastern
Europe, including Moldova, Bulgaria and Romania.
Djumaliev also said VTB Capital's trading volumes had
reached 10 million tonnes of oil and oil products per year and
that it had signed a contract with a Chinese refinery to supply
Its oil team includes two traders, Maxim Alenov and Mohsin
Kabir, hired in Switzerland in 2016, as well as Konstantin
Polyansky and Olga Danilova in the Moscow team.
(Editing by Dale Hudson)