By Megan Davies
MOSCOW, Feb 26 (Reuters) - Russia's second-largest bank VTB has stopped issuing new loans in Ukraine, with the situation in Kiev making it difficult to estimate risks, Chief Executive Andrei Kostin said on Wednesday.
Ukrainian President Viktor Yanukovich was driven from power over the weekend after months of political turmoil sparked by his decision to spurn deals with the European Union and improve ties with Russia.
While the country has an interim leader, a new government is yet to be formed.
"It is hard to evaluate the risk at the moment," Kostin said
Russian banks have an estimated $28 billion of exposure to Ukraine, with Gazprombank, Vnesheconombank (VEB), Sberbank and VTB among the main creditors.
On Tuesday, Fitch ratings agency said that Russian banks which made loans to Ukrainian companies or businessmen who bought assets there are at risk if the country's economy falls into recession..
Rival agency Moody's said earlier in the week that while Russian banks' exposure to Ukraine was significant, it remained manageable..
VTB has said it has exposure to Ukraine of 20 billion roubles ($560 million), which Kostin said was largely through big private companies, some of which are exporters.
The bank's business in Ukraine amounts to about 2-3 percent of total operations, Kostin said. The bank aims to stay in Ukraine for the long term, he added.
"We hope the situation will stabilise soon," Kostin told reporters.
The bank's shares closed 1.3 percent lower on Wednesday, underperforming the broad MICEX index which ended 0.6 percent lower.
Our Standards: The Thomson Reuters Trust Principles.