VLADIMIR CHERNOV of Moscow International Bank exemplifies the new Russian banker. He speaks flawless English, he has worked abroad, and he wears a flowered tie. But one trait distinguishes him from the rest, he says. He knows how to attract customers -- legally.
Mr. Chernov, a deputy general manager at the bank, describes what he says typifies the ''uncivilized'' tactics his rivals have been known to use to ''hunt'' for new clients.
''A big bank, which considers itself our competitor, approaches our customer and says, 'Hey guys, if you don't open an account with us you're going to have problems at customs,' '' he recounts, sitting behind a sleek conference table in his modern office several blocks from the Kremlin.
''Within a week or a month, this client has a complicated customs problem. The customs officer says, 'Hey guys, this is a deadlock. Maybe you should listen to the advice of some clever people,'' he continues. ''He then gives the name of that bank.''
Wave of crime, corruption
The liberalization of Russian banks along with the advent of capitalist-style reforms unleashed a new wave of crime and corruption in the banking world -- beginning with unscrupulous banking practices such as the one Chernov describes, and ending with the vicious gangland-style contract killings of top bankers.
Today such brutal practices are now so common that they don't always make headlines in the local press.
But the new youthful breed of Russian bankers is also beginning to distinguish itself from the rogues. What they lack in experience, they make up for in boundless energy and strong entrepreneurship.
Often under 30 years old, these young Russian bankers are willing to take risks and adapt to a quickly changing environment. And they have an unsurpassed ability to rake in profits in a country notorious for unclear regulations and almost no commercial infrastructure.
''We provide only verified, accurate information about ourselves and our services, and we abide by all the laws,'' Chernov says. He explains how his bank, which has several Western partners, is rated No. 6 in the country (based on size of assets) with a founding capital of $80 million.
''We are not trying to be the biggest,'' he says modestly with an air of affected nonchalance, ''but we are still practically the best.''
Roughly 2,500 commercial banks are now officially registered in Russia -- about one-fourth the number in the United States -- with a combined capital of about $70 billion, according to Central Bank figures.
Although few Russian banks are known in the West, new branch offices seem to open daily in Moscow, boasting shiny new facades, lavish interiors, and fierce gun-toting guards dressed in bullet-proof vests, camouflage fatigues, and combat boots.
But the average Russian customer, still unused to capitalist thinking, is wary of banks in general.
For decades, Russians either saved their money under their mattresses or deposited their savings at the Sberbank, the state savings bank, which primarily was a safe receptacle for ruble salaries.
These days, as banks accept both rubles and dollars and many incomes skyrocket, there is a need for banks that offer real retail services -- an area where Russian banks lag light years behind their Western counterparts.
Personal checks are virtually unheard of here, and no national credit cards exist. Because of rampant inflation, Russians either lug around huge suitcases of money for large purchases, or use debit cards, which few banks offer and only a handful of businesses accept. Such cards are usually used as a mechanism to pay salaries, as it is less time-consuming and safer.
Electronic clearing systems are rare, and automated teller machines are few and far between -- although one can be found in the State Duma, or lower house of parliament.
''In the United States you can get money from California to New York in seconds, here it can take weeks,'' says American Louis Schwartz, an executive vice president with Dialogbank, which specializes in corporate banking, but is expanding its retail services.
The lag often means banks have to be very focused on the asset and liability management of their ruble accounts. ''If a transfer takes two or three weeks in an inflationary environment, you have to be very sensitive how you price things,'' Mr. Schwartz says.
Story is uniquely Russian
The story of how these banks came into existence is uniquely Russian. Many of the largest banks were once state-owned, such as Promstroibank and Agroprombank, the former industrial and farm-sector lenders. During the Soviet era, these banks just channeled credits from one state pocket to another.
Others rely on the huge industrial monoliths that once held monopolies in all branches of industry. The Imperial Bank, for example, sprang from Gazprom, the gas monopoly run by oil and gas tsar Viktor Chernomyrdin before he became prime minister.
Still others, such as the now well-known Menatep and Stolichny banks, are pioneers, which started from scratch when former Soviet president Mikhail Gorbachev legalized independent banks in 1988. These banks quickly built a reputation in the Russian financial community, although some criticize them for making large profits on property and currency speculation.
Plagued by backward laws, short-term analysis leading to an inaccurate assessment of loans, and almost none of the basic technology Western bankers take for granted, some banks are nonetheless making money hand over fist. They are helped, in part, by a blitz of advertising and relatively new laws encouraging survival of the fittest.
Last year, the Central Bank revoked the licenses of 65 banks. In the first three months of this year, 51 others have already gone bankrupt, says Vyacheslav Zakharov, a former deputy head of Gosbank, who is now vice president of the Association of Russian Banks.
''We are very sorry that banks are going bankrupt, and we don't want that to happen,'' Mr. Zakharov says. ''But, on the other hand, this is a process which contributes to a market economy.'' But he adds that parliament is poised to adopt a law that would create an insurance fund to bail out deposits in floundering banks.
''There is a danger of a domino effect if too many banks start going bankrupt,'' he says. ''Some big banks are already experiencing difficulties, which could lead to a chain reaction and make the population lose money.''
The political sphere
Although banks are still captive to the country's economic and political sways, some have expanded their spheres of influence beyond business into politics -- a practice that puts the relationship between banks and the companies in which they invest into question.
An offer by six major banks and some other big businesses to take over the former state TV channel Ostankino, now Russian Public Television, awaits final clearance by a government divided on the issue. And a consortium of powerful banks recently offered to lend the state almost $2 billion in exchange for its stake in some of Russia's biggest industries.
''We are interested in financial stabilization, so we became government supporters,'' says Evgeny Saburov, head of investments for Menatep Bank, which is a member of the consortium and among the top five Russian banks.
But banks should remain uninterested in politics, those in the industry say.
The MOST group, a finance house that funded a huge media empire, recently ran afoul of the government with its critical coverage of the Chechnya conflict. After receiving threats from the Kremlin, founder Vladimir Gusinsky fled to London.