MOVES by a Russian MP to clarify changes in the country’s consumer lending laws are expected to soothe investors’ fears about London listed TCS Group, after its shares halved in trading.
Shares in the Russian firm, which were floated at $17 by Morgan Stanley, Goldman Sachs and Sberbank last month, fell as low as $8 on Friday before recovering to $11.50, after draft legislation in its home country appeared to ban the delivery of credit cards to consumers’ homes.
Anatoly Aksakov this weekend told TCS there had been a drafting error in the proposals and admitted the mistake after an outcry from the credit card group.
Oliver Hughes, chief executive of TCS, said: “This was an incorrectly drafted clause on consumer credit. It has been confirmed to us that the media interpretation was not correct and there was no threat to TCS.”
TCS, led by Oleg Tinkov – dubbed Russia’s Richard Branson – delivers all of its credit cards to people Russia through the postal service. Russian politicians are due to re-draft the clause at a parliamentary session tomorrow, TCS said.
The share price slide prompted some to ask why investors were not more aware of the threat to tightening loan rules.
The issue was flagged up in the share prospectus but people close to TCS said the draft amendment blindsided the group.
“This isn’t a bank issue,” one said. “It was a side swipe from out of nowhere.”