UPDATE 1-Russia's Promsvyazbank seeks around $400 mln in IPO

(Adds trading start date, shares sale size)

MOSCOW, Oct 3 (Reuters) - Promsvyazbank (PSB), one of Russia's largest privately owned lenders, set an indicative price range on Wednesday for its initial public offering of stock at $10-$12 per Global Depository Receipt.

The long-awaited IPO, which follows Sberbank's recent $5 billion government stake sale, could raise between $345 million and $414 million based on that range, PSB said in a statement.

In a two-step process, the bank will sell up to 30 million GDRs, including existing shares owned by main owner Promsvyaz Capital, followed by the issuance of new ordinary shares through a closed subscription.

Promsvyaz Capital, an investment vehicle through which brothers Dmitry and Alexey Ananyev own an 88.3 percent stake in PSB, will take part in the closed subscription, allowing it to retain its interest in the bank.

The European Bank of Reconstruction and Development is also considering subscribing with a view to maintaining its 11.75 percent stake, by converting part or all of a 3.5 billion rouble ($113 million) subordinated loan to PSB into stock.

The bank also set a price range of $13.33-$16 per 1,000 ordinary shares in the offering. Trading in the GDRs will commence in London on Oct. 15 and of ordinary shares in Moscow the week of Oct. 15, PSB said.

In September, PSB asked Russia's regulator to approve the listing of no more than 25 percent of its shares in London in the form of GDRs. Sources said at the time that the bank hoped to raise $500 million through the offering.

($1 = 31.0962 Russian roubles)

(Reporting by Olga Popova; Writing by Maria Kiselyova and Lidia Kelly; Editing by Douglas Busvine)

((maria.kiselyova@thomsonreuters.com)(+7 495 775 1242)(Reuters Messaging: maria.kiselyova.thomsonreuters.com@reuters.net))