VTB Gains Fourth Day on MSCI Weighting Boost Bets: Moscow Mover

VTB Group, Russia’s second-biggest lender, rose for a fourth day as investors speculated MSCI Inc. will boost the stock’s weighting in its Russia Index following a share sale, triggering more than $60 million in fund inflows.

VTB added 3.7 percent to 4.98 kopeks by the close in Moscow. The amount of shares traded was 59 billion, equivalent to about 1.3 times the three-month average. Its global depositary receipts gained 4.1 percent to $3.188 in London.

The lender sold $3.3 billion of new shares in Moscow and has secured investors, including Norges Bank Investment Management, the world’s largest sovereign fund. VTB’s free float will rise 14 percent after the offering, which is expected to close by May 24, according to Sberbank CIB. That will allow MSCI to boost the stock’s weighting to 3.3 percent from 2.1 percent, potentially triggering $64 million in passive fund inflows, Sberbank said.

“In a few days VTB will be increased in the MSCI,” Kirill Bagachenko, who manages about $3 billion in Russian equities at TKB BNP Paribas Investment Partners in St. Petersburg, said by phone. That will draw about $60 million from index trackers as well as possible inflows from active managers, he said.

VTB sold 102.5 billion rubles ($3.3 billion) of shares “entirely” on the Moscow Exchange in an offering that closed today, VTB’s Chief Executive Officer Andrey Kostin said in Sochi today at a meeting with President Vladimir Putin after the market closed.

The state-run bank was selling 2.5 trillion new shares at 4.1 kopeks apiece, VTB said on April 26. The government stake of 75.5 percent in VTB is expected to fall to 60.93 percent following the placement, VTB said on April 29.