Russia’s central bank plans to take Otkritie, one of the country’s largest state-run lenders, public in an IPO by the middle of next year to complete a turnround since its nationalisation in 2017.

Otkritie, which has a book value of about $7.3bn, will sell 15 to 20 per cent of its shares on Russian and potentially international exchange markets as part of a plan for the state to eventually relinquish its controlling stake, chief executive Mikhail Zadornov said in an interview.

The planned sale will cap a dramatic sequence of events that began when the central bank nationalised Otkritie, to prevent what would have been the country’s largest banking collapse.

The central bank has spent nearly $50bn on rescuing Otkritie, then Russia’s largest privately held bank by assets, and two other banks.

Trust, one of Otkritie’s former subsidiaries, was turned into a “bad bank” to contain the failed lenders’ problem debt and has so far recovered Rbs221bn of a planned Rbs482bn in assets.

Since then, the revamped Otkritie has more than doubled its loan book, which now makes up about two-thirds of the group’s total assets, together with securities.

Zadornov, who previously won praise for creating Kremlin-run VTB Bank’s retail division, told the Financial Times that before Otkritie goes public, he wants to raise its return on tangible equity from 13 per cent to above the Russian industry average.

“We spent three years restructuring the group and setting up normal business operations. Now we have to make it more effective and make the bank as a whole attractive as a group,” Zadornov said.

Otkritie, which made Rbs43.4bn in profit last year, wants to follow a series of Russian companies that have successfully gone public in the past nine months, feeding off pent-up investor demand for emerging market assets.

Ecommerce site Ozon, which became the first major Russian company to IPO in two years last November, has more than doubled its valuation to about $12.4bn, while discount retailer Fix Price attracted major cornerstone investors such as BlackRock and the sovereign wealth fund of Qatar to its IPO in London this year.

Otkritie does not have the tech flair of some of its competitors. It has shied away from following rivals such as Sberbank, which has built a tech-focused superapp offering a range of services, or diversifying into “lifestyle services” including holiday bookings and restaurant reservations, such as Tinkoff, whose market valuation has shot up to $15bn with assets that are less than a third of Otkritie’s.

Zadornov wants to make that slightly old-fashioned image a selling point. Under the group of Kremlin-connected tycoons who previously owned Otkritie, the bank was better known for its daring M&A deals and risky hedge fund-like transactions than taking deposits or issuing loans.

Several of the tycoons, including founder Vadim Belyaev, have left the country in the face of criminal charges and a series of lawsuits accusing them of embezzling billions of dollars in the run-up to collapse, which the former owners and executives deny.

Even after Zadornov’s team spun off many of Otkritie’s non-core assets and sold most of a large minority stake the bank had secretly acquired in VTB, it still owns a series of pension funds and businesses involved in Russia’s brokerage and insurance markets, acquired during Belyaev’s tenure.

Semyon Isakov, an analyst at Moody’s, said Zadornov had made “substantial progress” since the nationalisation that would attract equity investors. “The bank’s balance sheet was almost fully cleaned up from legacy problems and non-core assets. In parallel, the management was also able to substantially increase business volumes in order to bring reasonable operating efficiency,” he said.