* Sberbank using VBI for CEE expansion
* VBI returned to profit in Q1 - VBI CEO
* CEE arm to be rebranded with Sberbank name (Adds quotes and background)
VIENNA, April 24 (Reuters) - Russia's top lender Sberbank will provide up to 300 million euros ($394 million) in fresh capital for its new VBI eastern European arm this year to finance expansion, VBI Chief Executive Friedhelm Boschert said on Tuesday.
He also told reporters VBI made a profit in the first quarter after posting losses last year.
Sberbank paid 505 million euros in February to buy VBI from Austrian lender Volksbanken AG and boost its presence in emerging Europe. VBI is among the top 10 banks by assets in Bosnia, Croatia, the Czech Republic and Slovakia.
VBI is also in the top 15 in Hungary, Serbia and Slovenia, has a presence in Ukraine and is seeking to expand its banking licence in Austria.
The transaction gave Sberbank a network of 295 branches with more than 600,000 customers in the region.
It marked a first step in Sberbank's plan to get at least 5 percent of its net profit from international operations by 2014.
Sberbank is ramping up activities in central and eastern Europe to signal it is one of Europe's few banks with the firepower for overseas growth, deputy chairman Sergey Gorkov told Reuters last week.
At a news conference in Vienna, officials said VBI was targeting larger corporate customers in the region and planned to strengthen online retail operations there as well.
VBI's current three-person management board has been confirmed in office for three-year terms. Sberbank is also adding corporate finance expert Maria Bykova and strategy man Valentin Mihov to senior VBI management posts, the bank said.
Austrian businessman Siegfried Wolf is chairman of the supervisory board and Gorkov deputy chairman of VBI.
Sberbank executive Irakli Chogovadze, also a VBI board member, said VBI was defining strategies for individual countries and would present them to the board by July.
He would not rule out adding other countries to VBI's portfolio, reiterating the group's interest in Turkey and Poland, but would not discuss Sberbank's acknowledged interest in Turkey's Denizbank.
Denizbank was put up for sale by Dexia. Qatar National Bank has raised its bid for Denizbank after earlier talks stalled over price, sources told Reuters this month.
Sberbank also has operations in Ukraine, Kazakhstan and Belarus, but these will not be combined with VBI, Bykova said.
Chogovadze said the group was working on a new branding strategy for VBI. The new name "will have Sberbank in it, definitely", he added.
Boschert said boosting VBI's assets to 15 billion euros by 2016 from nearly 10 billion last year would be a "modest goal".
($1 = 0.7619 euros) (Reporting by Michael Shields; Editing by Mark Potter)