Russians Rushing to Buy Investment Diamonds
February 20, 25
(IDEX Online) - Wealthy Russians are rushing to buy investment-grade diamonds, according to VTB, the country's second-largest bank.
It says the number of polished diamond purchases by individuals for their portfolios soared by 60 per cent last year, largely as a result of the government abolishing VAT.
"The uniqueness and rarity of diamonds make them particularly appealing amid rising financial market volatility and restrictions on traditional investments," said Oksana Semenenko, vice president at VTB and head of its private banking division.
"Wealthy clients are building their portfolios on principles of diversification, allocating between 5 and 10 per cent to alternative investments, including gemstones."
The move comes as G7 sanctions and currency restrictions hit Russian diamond exports and Alrosa, the state-controlled miner, seeks alternative markets for its goods.
As part of its Diamond Exclusive program it is now polishing its largest and clearest +3-ct stones (generally D-F color, IF-VVS2 clarity) to be sold direct to investors through partnerships with VTB and other banks.
These, together with high quality fancy color diamonds, would normally be sold at tender.
Pic shows a branch of VTB bank.