Arthur McCallum, Head of Strategy at Eavex Capital.

The October 11 sentencing of Yulia Tymoshenko to seven years in jail and a fine of UAH 1.5bn (USD 188mn) for abuse of power has caused quite a stir internationally.

We maintain our view that the escalation of the Tymoshenko situation is a reflection of the highly diverse players and objectives within Ukraine generally and Yanukovych’s Party of Regions specifically.  Tymoshenko has positioned herself as a focal point for several economic and political issues, effectively raising the stakes for an administration being pulled in multiple directions, and forcing Yanukovych to take an active personal role in the resolution of what

By Andrei Skvarsky.

Russian bank UralSib has hired Anton Tabakh, a former researcher at Barclays and Troika Dialog, as senior fixed income analyst.

Tabakh spent several months as a freelance analyst after a brief stint with Barclays. He was senior fixed income analyst both at Barclays and at Troika, covering Russia, Ukraine and Kazakhstan in both jobs. 

By Andrei Skvarsky.   The head of Ukraine’s financial markets regulator, Vasyl Volha, has been arrested on the suspicion of “a corruption-related crime”, the Ukrainian Prosecutor General’s Office has announced.   The office did not elaborate but media reports say the chief of the State Regulatory Commission for Financial Services Markets is accused of accepting a $500,000 bribe.

By Andrei Skvarsky.

Russian brokerage Renaissance Capital has hired two senior bankers to cover operations in Russia, the CIS and Central and Eastern Europe.

Anton Cherny has joined as the London-based head of business development.

He worked for Renaissance as head of capital markets from 2005 to 2008, having previously held a senior corporate finance role at Merrill Lynch. After leaving RenCap in 2008 he was chief investment officer at Interros and ran his own advisory operation.

Dimitri Barinstein will work with senior clients in Russia, Kazakhstan and Ukraine when he takes up his Moscow-based position with RenCap on September 1. He has held managerial jobs with Goldman Sachs and Deutsche Bank in the past.

By Andrei Skvarsky

Russia’s two main bourses, Micex and RTS, have signed a merger agreement, with Micex president Ruben Aganbegyan appointed as head of the combined stock exchange and RTS chief Roman Goryunov as his deputy.

The new bourse, which will have “strong positions in Russia, Ukraine and Kazakhstan”, plans an initial public offering of shares for 2013, Micex and RTS said in a joint statement.

The deal is subject to approval by the Federal Anti-Monopoly Service and general meetings of the Micex and RTS shareholders scheduled for August. The two entities’ formal merger is to be completed by early 2012.

The two exchanges will be posting information about their merger process on a special website, www.exchange-integration.ru.

Micex, which is valued at 103.5bn rubles ($3.7bn), has Sberbank, the Central Bank, UniCredit, Vnesheconombank (VEB) as its key shareholders. The main stakeholders of RTS, which is worth 34.5bn rubles ($1.2bn), are Renaissance Capital, Troika Dialog, Aton, Da Vinci Capital and Alfa Capital.

Vladimir Kuznetsov, an equity analyst at UniCredit Securities, said the Micex-RTS merger is not a “market-moving event”.

"Even in terms of investor sentiment, we believe the creation of a unified central depository would have been a much more positive step in the development of an international financial centre rather than a government-sponsored merger of successfully competing bourses, which potentially could lead to corporate culture conflicts and other glitches,” Kuznetsov said.

“We do not believe the event will have any influence on stock prices on the domestic market in the near term,” he said.

By Andrei Skvarsky.

Russian brokerage Troika Dialog has hired four sales traders from Credit Suisse, Gazprombank and Alfa Bank for its offices in Moscow, Kyiv, London and New York.

Three of the newcomers will serve as fixed income sales officers, Troika said in a statement. The hires are among the first since Troika's owners agreed to sell up to state-controlled Sberbank earlier this year.

One of them is Sergey Yablonskiy, who worked at Russia’s Petrocommerce and Gazprombank lenders before being recruited for Troika’s Moscow office.

Another is Daria Tereschenko, who joins the Kyiv office from Indian oil and metals marketing consultancy NRG Capital. Earlier she had a job with Ukraine’s Pravex Bank.

The third is Jeffrey Weichsel, who will be posted in New York and worked at Alfa Bank before.

Jean-Paul Larcheveque comes to

By Andrei Skvarsky.

The World Bank has approved a loan of $200m for an energy saving project in Ukraine.

The loan, whose official recipient is state-owned UkrEximBank (Export-Import Bank), aims to help Ukraine to achieve its target of halving its energy consumption by 2030, the World Bank said in a statement.

This would reduce Ukraine’s dependence on gas imported from Russia.

“If the country were to reduce its energy intensity to the level of Poland it could reduce its energy consumption by about one-third. This could translate into a reduction of at least 30% in the consumption of natural gas,” said Martin Raiser, World Bank country director for Ukraine, Belarus and Moldova.

By Andrei Skvarsky.

Kirill Dmitriev, president of the $1bn Icon Private Equity fund, may be given the role of spearheading a major Kremlin project to attract foreign capital into Russia’s private equity sector.

Dmitriev, who has a series of highly lucrative projects on his record, was chosen for the job of running the planned $10bn Direct Investment Fund by state-owned development lender Vnesheconombank (VEB), according to Russian business daily Vedomosti.

His nomination is subject to approval by the Kremlin, which has modestly praised the banker but has expressed annoyance it was not consulted by VEB in picking the banker for the job.

Co-creation of DeltaBank in Ukraine and DeltaCredit Bank in Russia are some of the projects put to the credit of Dmitriev, who is on the Young Global Leaders list of the World Economic Forum.

DeltaBank was sold to General Electric for two and a half times the sum that

By Andrei Skvarsky.

Ukrainian Exchange, a bourse co-owned by Russian stock exchange RTS, launched trading in options contracts this week.

Currently futures-style quarterly options with settlement on June 15 and September 15, 2011, are being traded on the Kyiv-based stock exchange, the country's second largest after PFTS, RTS said in a report.

Ukrainian Exchange, in which RTS holds a stake of about 40%,  launched Internet trading in 2009 and futures trading in 2010.

By Andrei Skvarsky.

Beleaguered Kazakh bank BTA is closing its representative office in Kyiv.

The state-controlled Almaty-based lender, which also has offices in Russia, Britain, China and Dubai, announced the move in a one-sentence statement without giving any reason for it.

BTA defaulted on $12bn of debts during the global financial crisis. The bank has brought in fraud action against its former chairman Mukhtar Ablyazov, who is now on trial on fraud charges in Britain, where he fled to evade prosecution in Kazakhstan. Russia has also issued an arrest warrant for him, wanting him for alleged financial crimes.

By Andrei Skvarsky.

Russian broker Renaissance Capital has hired Igor Bilous from Swiss bank UBS as co-head for Ukraine and Central and Eastern Europe and has promoted Rob Reid to the role of head for Zimbabwe and Zambia.

Bilous, who takes up his duties on April 18 and will be based in Kyiv, will be in charge of investment banking and finance and will share general oversight over Renaissance’s operations in the region with Roman Nasirov, head of the firm’s equity and debt products group, according to a statement by RenCap.

While at UBS, Bilous was in charge of the bank’s Ukrainian business and worked on many landmark transactions.

These included Mittal Steel’s buyout of Ukraine’s largest steel company, Kryvorizhstal, in 2005, the sale of a 51% stake in UkrSibbank, one of Ukraine’s

By Andrei Skvarsky.

EPIC, a small and little-known financial services firm based in Vienna, pulled off a controversial deal late last week by buying out Ukrtelecom, Ukraine’s national fixed-line operator.

EPIC (European Privatisation and Investment Corporation), an emerging markets-focused asset management, investment and advisory firm with a staff of just over 200 but an  extensive international network, was the sole bidder for the phone company, according to media reports.

It will pay 10.58bn hryvni ($1.33bn) under the terms of the deal, which is due to be closed in two months’ time and is Ukraine’s biggest privatisation project since 2005, when the country sold its largest steel mill ArcelorMittal (MT) for $4.8bn.

Ukrainian investment banks believe, however, that Ukrtelecom could have brought in $1.8bn while ex-prime minister Yulia Tymoshenko claimed the country had missed $3bn to $4bn as revenue through the “shady” deal.

Other foreign companies, among them Deutsche Telekom and Norwegian telecommunications company Telenor, had

By Andrei Skvarsky.

Russian brokerage Renaissance Capital has appointed Roman Nasirov as its acting head for Central and Eastern Europe (CEE) to replace Peter Vanhecke, who was the driving force  behind many M&A deals.

Nasirov remains head of RenCap’s Ukrainian equity and debt franchise group, a position he has held since he joined the Moscow-based brokerage in 2009, according to a statement from Renaissance, which credits him with having been instrumental in its expansion into CEE.

Nasirov was previously head of sales and trading at Kyiv-based brokerage Concorde Capital, and earlier held a London-based job with U.S. investment bank BCG/Cantor Fitzgerald.