Russian state-controlled bank VTB Group has acquired Moscow city government's 46.48% stake in Bank of Moscow.

The city of Moscow sold its stake to VTB indirectly through the Central Fuel Company.

Simultaneously, the bank has also acquired 25% + 1 share of JSC Capital Insurance Group.

Since Capital Insurance Group owns a stake in Bank of Moscow, VTB is expected to gain control of the lender, with a stake of more than 50%.

VTB is said to have paid $3.53bn for the bank and insurance company stakes.

This follows the election of five VTB executives to the Bank of Moscow Supervisory Board at an Extraordinary Shareholders Meeting.

The acquisition of 46.48% of the Bank of Moscow shares and 25% + 1 share of the Capital Insurance Group was approved by JSC VTB Supervisory Council last week.

Besides Moscow’s planned asset sales, the Russian state is seeking to sell more than $30bn in government assets in the next three years to help balance the budget.

Most recently, the Russian government sold a 10% stake in VTB to international investors for $3.3bn.