4. Over 20 years of successful development
Establishment
and banking
license
9 new regional
branches
opened
34 branches
in the Moscow
Oblast
Cash collection
and delivery
services
established
Joined the
World Bank
development
program
Cooperation
with CIBC
S&P rating
Corr. accounts
with western
banks
1991-1992
License for
foreign
exchange
1993-1995
Associate
member of VISA
International
Authorized Bank
of the Russian
Government
Joined S.W.I.F.T.
Rated by the
Central Bank
as a stable
bank after
the financial
Crisis
CIBC
becomes a
shareholder
1996-1998 1999-2002
Bank’s ADRs
traded on the
Frankfurt
Stock
Exchange
Established
ATM network
and a
processing
center
The 3rd
largest
branch
network
Top 3 in the
State
Mortgage
Program
Best midcap Russian
bank (Big
Money)
Top 10 by
deposits
from
individuals
Top 7
mortgage
provider
$ 177 mln
raised by
20th issue
2003-2004
Top 20 by
corporate
loan portfolio
17th equity
issue raises
$33 million
Widest ATM
network in
the Moscow
Oblast
Joined
Deposit
Insurance
Program
Over 100,000
VISA cards
issued
3rd by
lending to
SME
$81 mln
EBRD
financing
Top 10 by
bank cards
issued
2009-2010
2005-2006
2007-2008
Overall
rebranding
Top 500
world’s
banking
brands
Bank of the
Year in Russia
in 2010 (The
Banker)
Best bank IR
and best IR
professional
(Thomson
Reuters )
Over 1,550,000
clients
CRM system
development
The most
transparent
bank in
Russia (S&P)
Best public
company
(Secret Firmy
Magazine)
Best SME
bank in
Moscow
Oblast
Best Corporate
Governance,
Russia (World
Finance)
Top 10 retail
banks in
Russia
Best IR
Management
in Russia
(Global
Banking &
Finance
review)
First MBS
deal on Rub
4,1 bln
2011-2012
2013
Alexander
Dolgopolov
appointed
as the
Chairman of
the
Management
Board
V.Bank
launched
project on
cost
efficiency
4
5. Vozrozhdenie Bank - a Community Bank built on strong relationships
with SMEs and individual customers
Vozrozhdenie Bank
strategy…
Focus On Core Banking Products
Servicing Corporate and SME Customers In Each Stage Of
Business Development
Servicing retail customers throughout their whole life-cycle
Balanced Lending and Funding policy
Prudent risk-management policy
Increasing efficiency in service delivery
…service…
… 1 700 000 Retail Clients…
… 63 400 Corporate and SME Clients…
…via…
… 21 Region
… 144 Offices
… 844 ATMs
… 6 173 employees
5
6. Distribution network
As of 01.07.2013
Moscow Oblast is a home territory with
historically strong market position
Branches
34
Sub branches
42
Retail offices
11
Total
87
526 ATMs – every town is under coverage
21 region of presence.
Focus on the most attractive
South and North-West
Branches
Sub branches
19
36
Retail offices
2
Total
57
318 ATMs
6
7. Basic information & position in Russian banking system
Key Figures, RUB
Rankings*
210,268 mln
Loans b.p.
Net Assets
28
Loans to SMEs
Assets
6
Volume of retail deposits
17
Mortgages
9
Corporate loans
21
Bank cards issued
13
Branches/ATMs
38/19
164,208 mln
Customer Funds
163,368 mln
Net Income for Q1’13
333 mln
Shareholders equity
21,162 mln
Retail Clients
1,700,000
Corporate Clients
Personnel
63,400
6,173
Offices
144
ATMs
844
* RBC most recent rankings
7
8. Market recognition
Credit ratings
Listing
Moody’s
Ba3/D-/NP, stable
Included in indices
Standard&Poor’s
BB-/ruAA-, stable
Listing
MICEX Financial Index
A1 MICEX
High recognition of brand
Moody's
S&P
Aaa
25
Aa
22
AAA
Moody's Interfax
S&P
national scale
Baa
16
B
10
Caa
7
AA
ruAA-
A
19
Ba
13
Aa3.ru
Moody's
World Finance
V.Bank was awarded for the “Best Corporate
Governance, Russia”, according to World Finance
survey
The Banker
V.Bank – “The Bank of the year 2010 in Russia”
as per the survey of The Banker magazine
A
BBB
Ba3
BB
S&P
international
BB-
01.01.06 01.12.06 01.11.07 01.10.08 01.09.09 01.08.10 01.07.11 01.06.12
B
CCC
IPSOS survey
85% of respondents in our regions know us
TNS loyalty survey
Loyalty index equals top 10% of major
international banks
94% of our clients are ready to recommend us
BrandFinance Banking 500 survey
V.bank ranks among top-10 Russian most valuable
banking brands with brand value of $190 million
8
10. Market strategy
Balanced Credit and
Resource policies
Personal bank for
corporate and retail customers
Focus on core banking
products
Corporate clients
Retail customers
Servicing on each stage of business
development
Servicing throughout their whole life-cycle
Customer acquisition
Expansion of branches and
ATMs network
Growth of individual depositors
and borrowers number
Payrolls combine retail and
corporate segments
10
11. Business model
Business based on relationships…
… gives stable non-interest income
RUB bln
- Customer oriented organic growth
Non-interest income
Net interest income
3 773
3 875
3 743
37%
40%
42%
59%
63%
60%
58%
64%
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
3 402
- Conservative balance sheet
41%
3 490
36%
- Primarily deposit funded
- Focused network expansion
- Increasing efficiency in service delivery
Loan portfolio development…
RUB bln
… funded by customer accounts
Corporate loans
156
143
164
163
28
31
33
57
53
118
91
98
124
131
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
152
151
40
48
94
151
26
Interest-bearing Deposits
Interest-free Current accounts
164
152
144
RUB bln
Note: all loans are gross loans
Retail loans
101
103
107
110
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
34
20%
49
80%
32%
67%
11
12. Assets and liabilities
Reliable assets structure…
…supported by customer-based funding
RUB bln
183
27
0,4
14
25
194
32
0,412
195
41
33
0,4
12
27
6
23%
37
Cash and
equivalents
1 11
Securities
Retail loans
106
111
117
110
107
Retail deposits
Corporate
loans
Other
assets
19
18
18
35
25
26
26
8
7
7
8
7 3
4
20
385
20
486
21
8 4
7
21
Q2'12
Q3'12
Q4'12
Corp. deposits
12
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
Q1'12
Due to other banks
Other liabilities
Subordinated
loans
Equity
Q1'13
8
12
Retail loan
portfolio
78%
36
30
24
22
21
18
32
31
12
L/D ratio back to optimum
Other assets
RUB bln
4%
Gross loans
Customer funds
100%
L/D ratio
RUB bln
101%
101%
1%
6%
15%
Retail accounts
Securities issued
12
Securities
84
78
77
72
12
Cash and
equivalents
Due from other
banks
19%
210
Corp. accounts
27 4
19
Share of IEA on the rise
195
209
81
194
183
Due from
banks
32
8
32
30
RUB bln
210
209
100%
144 143
152 152
151 151
156 164
164 163
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
95%
77%
55%
Corporate loan
portfolio
12
13. Timing of loan book expansion lagged deposits’ growth
Loan book major growth came at the end of Q1…
SME
Large corporates
Mortgage
Other retail
Administrations
RUB bln
…while deposits were raised at the year-end
Corporate deposits
Corporate accounts
+14,1%
+5%
3
9
17
3
10
19
11
21
2
11
22
2
+14,3%
1
11
23
-0,3%
21
18
74
Q1 2012
78
Q2 2012
41
77
Q3 2012
46
36
35
78
81
84
77
24
25
26
26
Q2 2012
Q3 2012
Q4 2012
Q1 2013
19
32
18
30
77
22
41
45
18
31
72
43
Q1 2012
Q4 2012
Q1 2013
Monthly customer funds
growth (RAS)
163
164
157
159
32%
83
Monthly loan portfolio growth
(RAS)
157
RUB bln
Retail deposits
Retail accounts
161
161
163
163
Jan
Feb
Mar
149
Nov
Dec
Jan
Feb
Mar
Nov
Dec
13
14. Who are SMEs?
What is our SME Definitions
Segment
Large business
Medium-size and small businesses
Micro businesses
Total credit exposure, RUB mln
> 750
30 - 750
6 - 30
Food processing – factories manufacturing different types of
high-quality food and drinks.
Petrol stations networks – complex service of high-quality petrol,
minimarkets and café, car washes and technical services.
Pharmacies networks – still healthy demand both for beauty
products and medicines.
Food retailers– small chains of handy stores “Close-to-House”
style for daily shopping located in dormitory area with high
density of population.
14
15. Corporate business
Corporate lending – focus remains on SMEs…
SMEs
Large corporations
RUB bln 80,00%
Other
+5.8%
118
41
43
120
124
41
124
…with 70% of loans less than RUB 0,75 bln
issued to 98% of clients
45
131
* as of December 31, 2012
73%
Share of portfolio
Share of clients
70,00%
60,00%
46
35%
50,00%
43%
40,00%
32%
30,00%
74
78
77
83
77
64%
20,00%
14%
13%
15%
10%
10,00%
3
Q1'12
3
2
Q2'12
Q3'12
2
Q4'12
1
Q1'13
1%
Current Accounts
56
2%
30-100 mln
up to 30 mln
62
-2.4%
60
RUR
RUB bln
55
66,0
FX
64,0
62,7
4,4
4,5
59,6
01.03.13
01.04.13
5,0
36
31
32
more than 750 mln
* under RAS
61,1
53
100-750 mln
…mostly nominated in RUB
Corporate funding...
Term Deposits
0,00%
30
35
22
24
25
26
26
Q1'12
Q2'12
Q3'12
Q4'12
Q1'13
66,0
65,0
5,0
4,4
58,2
61,0
60,6
01.05.13
01.06.13
01.07.13
6,7%
57%
43%
15
16. Conservative risk profile
Credit policy sticks to reliable collateral…
RUB bln
….providing mostly working capital…
*as of March 31, 2013
*as of March 31, 2013
Loan amount
Collateral value
109
57
54
29
3
Real
Estate
Equipment
& Vehicle
31,0%
17,9%
14,8%
25
20
Guarantees
*Guarantees are not taken into account
15,9%
Other
collateral&
blank
up to 30
days
31-90
days
91-180
days
181 - 365
days
1 - 2 years
130
14,5
*as of March 31, 2013
Other
131
130
14,8
15,5
23%
12.0%
29%
Real estate
114,1
116,6
115,2
115,9
114,1
Transport
Agriculture
Construction
01.03.13
01.04.13
01.05.13
> 2 years
…maintaining industry diversification
RUB bln
131
14,9
14,2%
6,3%
13
…in the same currency as SMEs revenues…
FX loans
RUB loans
128
14,1
70%
50
4
Government
guarantees
Corporate portfolio
Average LTV:
58%*
01.06.13
01.07.13
6%
4%
Manufacturing
RUB
164,208
mln
1%
6%
7%
2%
Administrations
22%
Wholesale &
retail trade
16
17. Retail lending – promising segment
Retail loan book changes (IFRS)
Credit cards
Mortgages
25,9
17,0
Retail loans maturity
RUB bln
Consumer loans
Car loans
28,3
18,5
31,4
32,8
33,6
*as of March 31, 2013
Primarily mortgages under state-related
agency JSC “AHML” standards
Retail portfolio
High-margin consumer loans to
customers with apparent cash-flow
–management of corporate clients
20,8
22,3
82,1%
22,8
2,2
0,4
6,4
2,1
0,4
7,2
2,1
0,4
2,1
0,4
2,1
0,4
8,0
8,1
8,3
1,9%
2,4%
Q1 2012
Q2 2012
Q3 2012
Q4 2012
Q1 2013
up to 90 days
91-365 days
13,6%
Currency breakdown (RAS)
26,0
0,4
Consumer loans, RUB
RUB loans
26,7
0,4
27,7
0,7
> 2 years
Rates for retail loans
RUB bln
FX loans
1 - 2 years
29,0
0,4
Mortgages, RUB
30,2
0,4
25
Credit cards, RUB
1.3%
20
15
25,6
13,4
27,4
28,6
29,9
We plan to further expand retail portfolio, which was an
important growth driver in the recent years
10
Particular focus is on mortgages as the most perspective
segment
01.03.13
01.04.13
01.05.13
01.06.13
01.07.13
01.07.10
01.01.11
01.07.11
01.01.12
01.07.12
01.01.13
5
01.07.13
17
18. Card business – reliable source of non-interest income
Business strategy…
…Generates strong fee income
Corporate
clients
Retail
clients
Interest
3%
14%
22%
18%
- Self-service
transactions
- Payrolls
- Acquiring
- Credit cards
…developing key card product - payrolls
Debit cards
82%
22%
cash operations
Visa and Mastercard
self-service
39%
Fees &
commissions
payrolls
1
Key points
Q3 2012
Payrolls
70%
acquiring
Q4 2012
Q1 2013
Q2 2013
13,500
14,000
14,200
- Payrolls is the main tool for client base growth with
strong potential – 63,400 of existing corporate clients and
17,000 installed “client-bank” systems
14,200
1,360,845
1,381,959
1,360,308
1,331,515
Credit
cards
45,471
46,646
48,297
50,470
ATMs
812
- Offering cards only to existing corporate clients: credit
cards for owners, top and mid-level managers and
specialists, debit cards for personnel
- Pushing cross-sales between retail and corporate
819
838
844
18
20. Risk management
Balance sheet structure
Capital position enhanced by subordination
Tier 1
RUB bln
Tier 1 + Tier 2
13,4%
11,8%
14,9%
14,8%
14,2%
13,2%
12,1%
11,6%
12,3%
Assets
Liabilities
80
11,9%
11,9%
70
60
11%
MIN
50
40
30
20
10
0
Q1 2012
Q2 2012
Q3 2012
Q4 2012
Q1 2013
01.06.13
Demand and less
than 1 month
CAR (N1)
under CBR rules
FX structure
From 1 to 6
months
From 6 to 12
months
More than 1 year
Interest rate risk
Assets
Liabilities
5%
RUB bln
70
Interest-earning assets
Interest-bearing liabilities
60
6%
15%
RUB bln
50
13%
40
30
20
80%
10
Roubles
US Dollars
Other
81%
0
Demand and less
than 1 month
From 1 to 6
months
From 6 to 12
months
More than 1 year
20
21. Credit quality management
NPLs dynamics
Annualized cost of risk
NPLs, RUB mln *
Provisions, % of total portfolio
NPLs, % of total portfolio
9,25%
Charges to provisions to avg
gross loans, QoQ
Charges to provisions to avg
gross loans, YtD
10,28%
9,52%
9,40%
9,09%
9,41%
8,68%
9,54%
9,02%
2,86%
2,24%
8,08%
2,46%
2,46%
2,06%
1,65%
1,02%
1,17%
1,02%
12 490
12 297
14 251
14 102
16 879
Q1 2012
Q2 2012
Q3 2012
Q4 2012
Q1 2013
Q1 2012
1,83%
Q2 2012
Q3 2012
Q4 2012
Q1 2013
* NPL includes the whole principal of loans at least one day overdue either on
principal or interest as well as not overdue loans with signs of impairment
NPLs categorization: improvement in core SMEs
SMEs
11,1%
10,8%
10,4%
10,0%
10,5%
9,9%
Retail
Large corporates
+ Rub 329 mln new NPLs
- Rub 322 mln recoveries
10,5%
+ Rub 2,654 mln new NPLs
- Rub 1 mln recoveries
17,6%
9,8%
9,8%
9,2%
8,9%
8,3%
8 263
8 120
7 841
7 765
7 772
Q1 2012
Q2 2012
Q3 2012
Q4 2012
Q1 2013
+ Rub 171 mln new NPLs
- Rub 55 mln recoveries
3 400
10,1%
13,2%
12,2%
11,9%
4,3%
12,2%
3,2%
8,0%
3 400
5 445
5 445
8 098
Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013
NPLs, RUB mln
3,6%
13,3%
Provisions, % of total portfolio
2,7%
827
777
3,5%
3,5%
3,6%
3,1%
2,7%
3,0%
965
892
1 009
Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013
NPLs, % of total portfolio
21
15
22. Credit quality
as of 31.03.2013
Gross loans, including
Current loans
RUB mln
Large
corporates
SMEs
46,060
82.4%
Past-due but not impaired, of
them
Mortgages
84,581
90.8%
Other
retail
22,819
98.1%
10,748
94.7%
Total
164,208
89.7%
Provisions
to NPLs
Ratio
93%
-
0.2%
1.3%
1.2%
0.4%
Less than 90 days
-
0.2%
0.4%
1.1%
0.2%
Over 90 days
-
0.9%
0.1%
0.1%
0.6%
4.1%
Provisions
to
90
9.9% days+ NPLs
0.3%
1.7%
Impaired, of them
-
17.6%
9.0%
Less than 90 days
5.8%
0.1%
Over 90 days
11.8%
8.9%
0.6%
3.8%
8.2%
17.6%
9.2%
1.9%
5.3%
10.3%
-13.3%
-9.8%
-2.8%
-5.3%
Total NPLs
Provisions
Net Loans
39,951
76,253
-
22,169
10,177
114%
-9.5% Rescheduled
Loans
148,550
5.3%
the whole amount of loans with principal overdue for more than 1 day as
NPL - well as loans with any delay in interest payments.
22
29. Capital structure
Share price on MICEX
Shareholding structure
Structure as of 13.05.2013
Chairman
Others
32%
30%
Shares
More than 8,000
individuals and 1,000
companies are among
our shareholders with
professional investors
owning more than
36%
Roubles
100 000
1 800
10 000
1 440
1 000
1 080
100
720
10
360
38%
1
1.7.12
0
1.9.12
1.11.12
1.1.13
Volume
1.3.13
1.5.13
1.7.13
Last price
As per MICEX data
Volumes of trading (shares)
Major shareholders
SHAREHOLDER
STAKE IN EQUITY
Dmitry L. Orlov (Chairman of the Board of Directors)
32.03%
19.67%
JPM International Consumer Holding Inc.
9.88%
H1 2011
H2 2011
H1 2012
H2 2012
H1 2013
MICEX
744,081
551,544
892,502
1,966,722
535,131
598,489
RTS
Otar L. Margania (Member of the Board of Directors)
H2 2010
186,333
65,303
82,098
50,437
30,230
9,090
24,054
13,444
3,255
3,685
7,300
3,900
954,468
630,291
977,855
2,020,844
572,661
611,479
German stock
exchanges (ADR)
Sub-total (stock
exchanges)
OTC
Total
61.58%
1,109,859 1,080,856 2,141,597
873,225
1,421,277
100,610
Total
2,064,327 1,711,147 3,119,452
2,894,069
1,993,938
712,089
*Volume growth associated with strategic deals
29
30. High level of corporate governance
MANAGEMENT STRUCTURE
CHAIRMAN OF THE
MANAGEMENT BOARD*
System of control
GENERAL
MEETING OF
SHAREHOLDERS
Mr. Alexander Dolgopolov
AUDITOR
PricewaterhouseCoopers
Audit commission
BOARD OF DIRECTORS
HR and
Compensation
Committee
12 members
Audit committee
9 are non-executive
6 independent
Internal Control
and Audit Service
Risk Management
MANAGEMENT BOARD
The arrows represent the authorities to appoint
or elect the relevant Bank’s bodies and the
External Auditor
13 members
5 Deputy Chairmen
- Timely information provision to investors
- Full disclosure on web-site
- Quarterly IFRS financial reporting with web-cast
presentations
- Financial reports under IFRS audited from 1991
Continuing excellent reputation recognition:
- Solid and professional team
V.Bank has
the Best
Corporate
Governance in
Russia, 2013
Andrey
Shalimov
was
awarded for
the Best IR
in 2012
V.Bank was
awarded as
the Bank of the
Year in Russia
in 2010
Dmitry Orlov is included
in top10 of the best bank’s
managers 2009
The most
shareholder
transparent bank
in Russia – 2006,
2007, 2008
30
31. Investment Summary
SOUND STRATEGY
More than 20 years in Top-30 Russian banks amid
changing competition landscape
Successfully passed through recent crises (199394,1998, 2004, 2008)
Business model generating solid fees & commissions
(40% of revenue)
Organic growth in core regions and client segments
Focus on operating efficiency
One of the most transparent FI in Russia – Best
Corporate Governance by World Finance in 2013,
leaders of Information Transparency to Shareholders
by S&P in 2008, 2007, 2006
Management Board (13 members) with long-term
banking experience, the Board of Directors headed by
Chairman with 40 years in Soviet and Russian
banking systems
BUSINESS STRENGTHS
Loyal clientele due to strong relationships with the
customers
60% of client base is concentrated in fast growing
Moscow Oblast
Corporate business focused on high-profitable
SME, retail one – on mortgages
Broad product line based on advanced IT-solutions
Financial markets turbulence
Ongoingof global economy slowdown
Threat pressure on lending rates driven by state banks
Limited demand from key risk sector – SME
Still high potential credit client
Still high potential credit risk
Positive track-record of communication with investors
HIGH STANDARDS
CURRENT CHALLENGES
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32. Investor Relations contacts
Yulia Vinogradova, Advisor to the Chairman
Yu.Vinogradova@voz.ru
Elena Mironova, Deputy head of IR
E.Mironova@voz.ru
Maria Gorbunova, IR specialist
M.Gorbunova@voz.ru
Download contacts:
+7 495 620 90 71
investor@voz.ru
http://www.vbank.ru/en/investors
Follow us on Twitter:
www.twitter.com/vbank_IR
Download presentation:
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33. Disclaimer
Some of the information in this presentation may contain projections or other forward-looking statements regarding future events or the future financial
performance of Bank Vozrozhdenie (the Bank). Such forward-looking statements are based on numerous assumptions regarding the Bank’s present and
future business strategies and the environment in which the Bank will operate in the future.
The Bank cautions you that these statements are not guarantees of future performance and involve risks, uncertainties and other important factors that we
cannot predict with certainty. Accordingly, our actual outcomes and results may differ materially from what we have expressed or forecasted in the
forward-looking statements. These forward-looking statements speak only as at the date of this presentation and are subject to change without notice. We
do not intend to update these statements to make them conform with actual results.
The Bank is not responsible for statements and forward-looking statements including the following information:
- assessment of the Bank’s future operating and financial results as well as forecasts of the present value of future cash flows and related factors;
- economic outlook and industry trends;
- the Bank’s anticipated capital expenditures and plans relating to expansion of the Bank’s network and development of the new services;
- the Bank’s expectations as to its position on the financial market and plans on development of the market segments within which the Bank operates;
- the Bank’s expectations as to regulatory changes and assessment of impact of regulatory initiatives on the Bank’s activity.
Such forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those
expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include:
- risks relating to changes in political, economic and social conditions in Russia as well as changes in global economic conditions;
- risks related to Russian legislation, regulation and taxation;
- risks relating to the Bank’s activity, including the achievement of the anticipated results, levels of profitability and growth, ability to create and meet
demand for the Bank’s services including their promotion, and the ability of the Bank to remain competitive.
Many of these factors are beyond the Bank’s ability to control and predict. Given these and other uncertainties the Bank cautions not to place undue
reliance on any of the forward-looking statements contained herein or otherwise.
The Bank does not undertake any obligations to release publicly any revisions to these forward-looking statements to reflect events or circumstances after
the date hereof or to reflect the occurrence of unanticipated events, except as may be required under applicable laws.
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