Russia’s Sberbank and Troika Dialog have joined forces to create the largest universal banking institution in Russia, which includes significant wealth management activities.

The merger will allow Sberbank to attain a “new level of client service” providing high-quality financial advisory services and an extensive choice of investment strategies, the firms said in a statement.

Moreover, the integration process will create a new division called the Corporate Investment Bank, which will provide services to the largest Russian and foreign corporations and financial institutions, ultimately forming part of the corporate business unit, to be managed by Andrey Donskih, deputy chairman of Sberbank’s management board.

Alexander Bazarov, who is a member of the management board as well as vice president of Sberbank and director of the corporate clients department, has been appointed co-head of CIB, along with Ruben Vardanian, chief executive of Troika.

As well as the CIB arm, a wealth management division will offer private clients asset management and private banking services. Vardanian will head the wealth management arm, with Bella Zlatkis, deputy chairman of the management board of Sberbank, overseeing the unit.

According to preliminary data for 2011, Sberbank and Troika together generated RUB22 billion (about $720 million) of income from operations made on the financial markets, RUB8 billion of which stemmed from securities sales and trading operations, while RUB6 billion came from conversion operations and precious metal operations, the firms said.

Last year, investment banking activities in Russia produced a preliminary total income of RUB3.4 billion, a figure which the bank said it plans to “significantly increase” in the immediate future once the teams are unified.  

“We have ambitious goals: in 2014 we expect to double income from investment banking activity. At the moment we are already working on over 70 investment banking deals,” said Herman Gref, chief executive and chairman of the management board of Sberbank.

Gref added that the merger will enable the bank to “modernise the Russian financial industry.”

“In the immediate future we will continue to strengthen our team and have made plans to develop existing products and launch new ones. At the moment we view global market operations, structured products and investment banking services as promising areas of business,” said Vardanian, who is also chairman of Troika Dialog's board of directors.

Sberbank is Russia’s largest bank, accounting for 27 per cent of the aggregate banking industry.