This sanctioned bank is now Norway’s most valuable asset in Russia
Norwegians are not allowed to buy or sell new bonds, equity or similar financial instruments with a maturity exceeding 90 days issued by Sberbank. This follows the European Union’s sanctions from 2014 after Moscow’s annexation of Crimea and destabilizing the situation in Eastern Ukraine.
Norway follows the EU sanctions word-by-word.
The sanctions, however, do not hinder Norway’s Government Pension Fund Global, known as the wealth fund, to buy more shares in Sberbank.
The fund increased its share in the bank from 0,77% in 2019 to 0,83% in 2020.
The shares owned by the Norwegian wealth fund had a value of 6 billion kroner (€579 million) by December 31, 2020.
Although buying a bigger share last year, the value of the fund’s shares in Sberbank was down 490 million kroner compared with the 2019 value.
Second on the list of the fund’s investments in Russia is Gazprom, with shares worth 3,98 billion Norwegian kroner (€384 million). The Norwegian fund decreased its shares in Gazprom from 0,81% in 2019 to 0,69% last year, according to the portfolio overview. Gazprom is the largest publicly-listed natural gas company in the world and the largest company in Russia by revenue.
Investments in the Russian stock market are not very high on the fund’s list, counting for only 0,2% of the global portfolio.
The Norwegian share in 47 Russian companies in the fund had a value of 23 billion kroner as of December 31, down from 51 companies worth 31 billion kroner in 2019.
For Norway, which money is revenue from the oil and gas production, investments in Russia are heavily focused on petroleum companies like Bashneft, Gazprom, Gazprom Neft, IG Seismic Services, LUKOIL, Novatek, Saratovskiy Neftepererabatyvayuschiy Zavod and Surgutneftegas.
Third most valuable company among the fund’s investments at the Moscow stock exchange is oil company Lukoil. The Norwegians have a 0,90% share at a value of 3,75 billion kroner of the company.