State-controlled Sberbank will clear the bulk of current bad loan provisions within three to four years, chief executive German Gref said Friday at the bank's annual shareholders meeting.

Speaking at the same meeting, Central Bank Chairman Sergei Ignatyev said the increase in provisions, which rose to 7 percent of the portfolio by June 15, necessitated close examination of a possible takeover of Kazakh BTA.

"I am a very cautious and conservative person. The bank [BTA] is a big one and with big problems. So, it should be examined thoughtfully," Ignatyev, who is also the head of Sberbank's supervisory board, told a news conference. The Central Bank is Sberbank's controlling shareholder.

Gref reiterated that Sberbank would be profitable this year because of cost cuts, despite rising nonperforming loans. The government has set aside funds to recapitalize state banks, but Sberbank has said it will not avail itself of them this year.

"In three to four years, we can get back most of the provisions for bad loans, in part by selling off collateral," Gref said.

Bankers and analysts have said state-run banks holding the lion's share of potentially lucrative industrial assets could parlay the collateral into huge profits.

Sberbank, home to half of Russian bank accounts, saw deposit inflows of 58 billion rubles ($1.86 billion) in June, making a total inflow of 195 billion rubles so far this year.

The head of the bank's finance department, Alexei Morozov, said provisions would only start to clear at the end of 2010 and were likely to rise until then. Sberbank has now made provisions for bad loans exceeding 7 percent of its portfolio, while 3 percent have already gone sour, Gref said.

"The rate of NPL growth is slowing. But we can't say for now whether it is a trend or whether there will be a spike."

Shareholders also voted to approve a 2008 dividend payment of 48 kopeks per ordinary share and 63 kopeks per preferred share, or 10 percent of the company's profit according to Russian accounting standards, Interfax reported.

With profit of 109.9 billion rubles in 2008, the total dividend payment will be 10.99 billion rubles. Sberbank paid 11.67 billion rubles of dividends for 2007, also 10 percent of that year's profits.

Asked why Sberbank's interest rates for deposits were not as high as at other lenders, Gref bristled.

"We're not a casino. There are plenty of banks that are offering 20 percent [per year]. People who want to lose, I'll send to those banks. We'll see later how they're going to get their money back out," he said, RIA-Novosti reported. He defended Sberbank's 12 percent rates for ruble deposits as "balanced."