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MOSCOW, March 28 (Reuters) - Andrei Kostin, the chief executive of Russia's VTB bank said on Tuesday there was space for Russia to issue a sovereign Eurobond this spring but that the finance ministry had not employed a bank to arrange such a debt sale.
Kostin was speaking to reporters on the sidelines of a meeting of the Association of Russian Banks.
VTB Capital, the investment banking arm of VTB, was the sole arranger of both Eurobonds Russia sold last year, in May and September, raising $3 billion.
The finance ministry has said it is in no hurry to issue another Eurobond.
Separately, Kostin said that VTB was in talks with a number of investors, including Ukrainian ones, over a potential sale of VTB's Ukrainian banking business, adding that any sale in Ukraine now will be at a discount.
Kiev has imposed fresh sanctions this month on the Ukrainian subsidiaries of Russian state-owned banks over Moscow's role in the Ukrainian crisis.
"We have two options: to sell the bank or to gradually cut its balance ... we will find the decision by the end of the year," Kostin said. He did not indicate how much VTB might want for the bank.
Sberbank, Russia's largest bank by assets, said on Monday it had agreed to sell its Ukrainian subsidiary to a consortium of investors, which include Norvik Bank (Latvia) and a Belarussian private company, but did not disclose the price.
Kostin also said VTB was not planning to take a stake in Russia's mid-sized oil producer NNK, owned by ex-Rosneft Chief Executive Eduard Khudainatov, in exchange for debt NNK owes to VTB. Kostin did not say how much NNK owes to the bank.
"We do not plan this at the moment and this is highly unlikely (to happen) ... In general I doubt we will take a stake there, but never say never," Kostin said.
Vedomosti daily newspaper reported last month that Khudainatov was preparing to sell NNK, which may cost $4 billion, according to an analyst quoted by the newspaper. (Reporting by Katya Golubkova; Writing by Kevin O'Flynn; Editing by Polina Devitt and Catherine Evans)