THEY are larger-than-life figures at home and abroad, men who saw themselves as the Carnegies or Rockefellers of Russia. They are known as oligarchs, and they may soon be thrown into the dustbin of history by the economic crisis.
Brash, young and wealthy, those insiders of post-Soviet business who escaped nationalization — to say nothing of exile or prison — under Vladimir Putin went on to make ever greater fortunes in the commodity boom of recent years. But few businessmen anywhere have fallen as hard or as fast in recent months.
Many of Russia's richest men were highly leveraged going into the financial crisis and were unable to roll over loans from Western banks. The Kremlin bailed them out with short-term credits last year, not wanting the assets to fall into foreign hands. Those state loans will be coming due by the end of the year, on top of additional foreign loans.
The mountain of debt is so huge — the Central Bank calculates that corporations and banks in Russia must repay $128 billion this year alone — that many oligarchs will be unable to repay the loans, bankers say. Only a fraction of this debt, about $7 billion, is corporate bonds. The rest is bank loans to companies predominantly owned by the oligarchs or the state...