1 presentation july 2010. overview 2 3 bank of moscows key strengths and investment highlights 3 rd...
TRANSCRIPT
Overview
2
3
OverviewBank of Moscow’s Key Strengths and Investment Highlights
3rd place by volume of retail deposits provides
reliable and stable funding base
Moody’s: Baa1Fitch: BBB-
5th largest bank in Russia in terms of total assets
Well-diversified and solid client base of large corporate, SME and
retail clients
Extensive distribution network in Moscow and
key Russian regions
Strong risk profile
Track record of strong support from the City of Moscow – the
largest shareholder
Shareholder Structure
4
Shareholder Structure The City of Moscow has been the largest
shareholder of the Bank since the Bank was established in 1995
Combined stake of the City of Moscow in the Bank’s share capital is 66.4%, including direct shareholding of the Property Department of the City of Moscow - 48.11% and indirect shareholding of the companies of the Capital Insurance Group - 18.29%. The Capital Insurance Group is, in its turn, controlled by the City of Moscow and the Bank of Moscow Group.
Mr. Andrey Borodin, Chairman of the Management Board, and Mr. Lev Alaluiev, citizen of the Russian Federation, indirectly jointly control 23.07% of the Bank’s share capital.
Since 2004 Bank’s shares are traded on MICEX.
The new 14th issue of shares for RUB 21 bln is planned to be completed by the middle of July 2010.
As the result, the capital of the Bank will be increased to RUB 108,3 bln (USD 3,5 bln).
Controlled by
the City of
Moscow
5
48,11%
7,28% 3,25%
23,07%
18,29%
Property Department of the City Moscow Government
OJSC Capital Insurance Group
Beneficial ownership of Mr. Borodin and Mr. Alaluev
LLC "GSM", LLC "GSM Investment" (Controlled by GCM RussiaOpportunities Fund, Cayman Islands)
Minority shareholders
Business Overview
6
Top Russian Banks by Capital (RUB, bln)
Bank of Moscow’s Market Position
13 350
Top Russian Banks by Net Assets (RUB, bln)
6 786
7
3 324
Top Russian Banks by Retail Deposits (RUB, bln)
Top Russian Banks by Loan Portfolio (RUB, bln)
5 481
Business Overview
Ratings Reflect the Credibility of the Bank*
Business Overview
A2
A3
Baa1
Baa2
Baa3
Ba1
Ba3
A
A-
BBB+
BBB
BBB-
BB+
BB
BB-
B+
Ba2
8* Senior Unsecured Eurobond Ratings
Business Overview
Current and deposit accounts
Loan services
Mortgages
Debit and credit cards
Money transfers
Internet and telephone banking
Internet trading (“Mos-broker”)
Corporate lending
Syndicated loans
Trade finance and guarantees
Foreign trade and exchange operations
Debt Capital Markets (Local and International)
Payment and account services
Securities trading
Precious metals
Depositary services
Underwriting
Research
Private asset management services
Fund management services
Mutual and pension funds
Private Banking
Business Lines
9
Corporate and Investment BankingRetail Banking
Asset Management & Private Banking
Business Overview
No. 3 retail deposit taker in Russian Federation
RUB 177.5 bln of term deposits and current accounts of individuals as of January 1, 2010*
Approved by CBR to participate in the Deposit Insurance System
Authorised bank of the Deposit Insurance Agency to manage retail accounts of the banks with withdrawn licences
Over 9,7 million retail customers as of January 1, 2010
As of May 1, 2010 - 13.9 mln plastic cards issued (compared to 11.0 mln as of January 1, 2009)
Variety of deposit products designed for different categories of retail customers
Wide range of services targeted at the inhabitants of the City of Moscow, including Muscovite Social Cards issued in partnership with VISA International. It is a combination of a bank debit card, an identification card, an insurance identification card and Moscow public transportation travel card designed for those Muscovites, who receive pay offs from the City’s budget.
1824 ATMs and self-service zones inside retail locations and offices throughout the country to allow customers to get services from ATMs such as credit payments, transfers, deposits, utility and mobile communication payments, etc.
Advanced Internet and Telephone banking
Retail Banking
10* Source: Bank of Moscow IFRS Consolidated Financial Statements as of December 31, 2010
Business Overview
Over 106 000 corporate clients as of January 1, 2010
Focus on stable sectors of Russian economy
Corporate banking dominates the asset side of the balance sheet:
as of January 1, 2010* corporate loans accounted for 80.8% of the Bank’s gross loan portfolio and stood at RUB 431.7 bln*
involved in financing the key projects of the City of Moscow
Developing banking products and services targeted at SME clients
Increasingly active in trade financing
Provides payment services to commercial and public sector clients through branch network
Corporate and Investment Banking
11* Source: Bank of Moscow IFRS Consolidated Financial Statements as of December 31, 2009
Variety of investment banking services, including:
underwriting
debt issuance
research
asset management
Business Overview
Over 900 correspondent banks in 104 countries worldwide, including 65 new relationships established in 2009
Clean lines for trade related and treasury operations established by major international banks
RUB clearing bank for over 100 banks and one of the major providers of trade services in Russia
Variety of products offered:
L/C confirmations and deferred payments
Guarantees and Standby L/Cs
Post-financing
Pre-export financing
Financial with ECA coverage
Forfeiting
22,6% growth of the trade finance portfolio in 2009, including 39,3% increase of L/G’s
Eligible partner in Russia for the overwhelming majority of ECAs worldwide
Framework Credit Agreements signed with the leading international banks for ECAs covered financing
Correspondent Banking and Trade Finance
12
Geographical breakdown of the correspondent network
39%
9%4%15%
2%
24%6% 1%
Europe
CIS and Baltics
USA & Canada
Asia
Latin America
Russia
Africa
Australia
Business Overview
137 outlets and 474 desks at postal offices in Moscow and Moscow Region 68 regional branches and 190 sub-branches With total 394 outlets throughout the country - presence in 60 regions of Russian Federation Foreign subsidiaries in Belarus, Latvia, Estonia, Ukraine, Serbia and Representative office in Frankfurt
Moscow-based with Wide Geographical Reach
United Statesof America
13
Estonia Petrozavodsk
Arkhangelsk
Kaliningrad
Vyborg
St. Petersburg
Vologda
Kirov
Yaroslavl
Tula
Kursk
Rostov-on-Don
KrasnodarSochi
Vladikavkaz Astrakhan
Orsk
Orenburg
Samara
Saratov
Voronezh
Nizhny NovgorodCheboksary Berezniaki
Perm
Izhevsk
Yekaterinburg
Tyumen
Moscow
Omsk Tomsk
Kemerovo
Novosobirsk
Novokuznetsk
Kransnoyarsk
IrkutskUlan-Ude
Vladisvostok
Khabarovsk
Yuzhno—Sakhalinsk
Petropavlovsk—Kamchatsky
“Moscow-Minsk” (Minsk)
“Zarechye”(Kazan)
“Latvian Businessbank”(Riga)
Poland
Byelorussia
Latvia
Finland
Norway
Ukraine
Turkey
Iran
Kazahkstan
China
Japan
United Statesof America
Russian Federation
Regional Branches
Subsidiary and Affiliate Banks
“BM Bank” (Kiev)
Barnaul
Maykop
Belgorod
Stavropol
“Eesti Krediidipank”(Tallin)
Orel
Volgograd
UfaYakutsk
Velikiy Novgorod
LipetskKazan
SyktyvkarKovrov
Chelyabinsk
Business Overview
Emphasis on the further increase of risk management efficiency Rigorous control over the asset quality Credit risk diversification and strengthening of underwriting standards
Prudent Risk Management Policy
Retail Banking
Increase and diversify the customer base Maintain high quality of the loan portfolio coupled with a rise in cross selling Provide flexible services and solutions to customers to address the current market
environment
Corporate Business
Increase and diversify the customer base Maintain high quality of the loan portfolio Provide flexible services and solutions to customers to address the current market
environment
PRESERVE ASSET QUALITY, EFFICIENCY OF BUSINESS AND MAINTAIN THE CURRENT MARKET POSITION
Business Efficiency and
Market Positions
Offer services to wealthy individuals in line with international standardsPrivate Banking
14
Business Strategy
Branch Network Retain positions in the regions Use the regional network to diversify client and risk concentration
Increase business efficiency Maintain leading positions in the national banking industry Tighten control over the quality of all business processes, costs and expenses
Business Overview
Based on recommendations and requirements of CBR, Basel Committee and auditors Single borrower/economic group limits Product type/geographic/industry concentration limits Ongoing monitoring of borrower’s condition and collateral Strengthening of underwriting standards to address the crisis
Conservative Credit and Market Risk Policies in Place
15
Credit Risk
Limited open foreign currency position, stop-loss, borrower limits Centralised control over exchange rates in currency operations In accordance with CBR regulations, currency risk exposure cannot exceed 20% of the Bank’s aggregate capital
in all currencies Currency position is controlled by the CBR on a daily basis
Currency Risk
Managed with the aid of scenario analysis, simulative, optimising and predictive modelling Strict CBR controls on instant (N2) and current (N3) liquidity standards Monitored on a daily basis
Liquidity Risk
Measured via gap and interest rate sensitivity models Also employ stress testing and scenario analysis techniques
Interest Rate Risk
Vertically integrated risk management system penetrating the Bank, incl. regional branches, with
the CRO reporting directly to the CEO and the Management Board. Credit Committee, Small Credit Committee and Mortgage Committee are authorised to make
independent lending decisions.
Business Overview
Eurobonds:
US$ 300,000,000 Eurobonds due the end of 2010
CHF 250,000,000 Eurobonds due 2011
US$ 500,000,000 Eurobonds due 2013
US$ 750,000,000 Eurobonds due 2015
LT2 Debt:
US$ 300,000,000 Subordinated Eurobonds due 2015
US$ 400,000,000 Subordinated Eurobonds due 2017
Local Bonds:
RUR 10,000,000,000 Bond due 2011
RUR 10,000,000,000 Bond due 2013
Bank of Moscow in International and Local Capital Markets
4 senior Eurobonds issued over the last five years
2 placements on the local debt market
2 syndicated Term Loans outstanding
In 2010 the Bank of Moscow raised 750 US$ bln from international markets
16
Syndicated Loans:
US$ 220,000,000 Syndicated Term Loan was repaid in 2009
US$ 105,000,000 Syndicated Term Loan was repaid in 2010
US$ 600,000,000 Syndicated Term Loan was repaid in 2010
US$ 30,000,000 & EUR105,000,000 Syndicated Term Loan due 2011
US$ 350,000,000 Syndicated Term Loan due 2011
Financial Overview
17
Financial Overview
0,6% 0,63%9,2%
65,0%
16,0%
6% 2%
Loans to customers
Financial Assets
Cash & cash equivalents
Due from other banks
Premises and equipment
Other assets
Mandatory cash balances w ith central banks
Asset Composition (2009)* Assets in 2006 – 2009 (RUB bln)
Overview of Assets
18* Source: Bank of Moscow, IFRS Consolidated Financial Statements as of December 31, 2009.
100% = RUB 825,1 bln
63,9133,337,2
51,3
47,0
351,6
43,776,0
132,5
256,0
577,8
516,6
0
200
400
600
800
2006 2007 2008 2009
Cash and equivalents Trading securities Loans to customers
10,9%
3,8%
6,2%
3,2%
21,8%
15,3%
5,2%4,0%
2,5%
12,5%13,9%
Individuals Financial & other services
Manufacturing Construction
Trade Fuel & Energy
State Agencies Food Industry
Metallurgy Transport & Communications
Others
Financial Overview
Loan portfolio is well diversified by industries and geographically, which is in line with the credit risk management approach.
40% of the Bank’s gross loan book are concentrated in regions.
Focus is on the stable sectors of the Russian economy.
Bank of Moscow’s Loan PortfolioLoan Portfolio Breakdown by Industry Sectors (2009)*
19* Source: Bank of Moscow, IFRS Consolidated Financial Statements as of December 31, 2009
Financial Overview
Overdue Loans and Allowance for Loans Losses
Bank of Moscow’s Loan Portfolio (Cont’d)
20
As of December 31, 2009 the provisions totalled RUB 43,3 bln. NPLs accounted for 3,94 % of the Bank’s gross loan portfolio. The NPLs are 1,9 times covered by provisions. Loan portfolio is collateralized by 1.9 times
186,80%
166,0%
190%
3,94%
1,50%0,70%
10,00%
110,00%
210,00%
2007 2008 20090,0%
10,0%
20,0%
LLP/NPL NPL/Gross loans
• Source: Bank of Moscow, IFRS Consolidated Financial Statements as of December 31, 2009
37,969,6
214,9 225,7173
224
255,3 250,6
86,5
126,7
151,2177,5
50,5
56,0
91,778
0
200
400
600
800
2006 2007 2008 2009Due to other banks Due to Corporate customersDue to Retail customers Debt securities issued
34%
31%
24%
11% 0,3%0,4%
Due to Corporate customers Due to banks
Due to Retail customers Debt securities issued
Other liabilities Financial Liabilities at Fair Value
Financial Overview
Liability Composition (2009) Liabilities in 2006 – 2009 (RUB bln)
Overview of Liabilities
21
100% = RUB 738,5 bln
Strong deposit and well balanced base has always been one of the key advantages of the Bank.
As of December 31, 2009, customers accounts comprised 61,1% of the Bank’s liabilities.
Customer funds increased 11,0% in 2009.
* Source: Bank of Moscow, IFRS Consolidated Financial Statements as of December 31, 2009
428,0
259,5
350,6
406,5
0
50
100
150
200
250
300
350
400
450
2006 2007 2008 2009
Financial Overview
34,5%
65,5%
Current / Demand Accounts Term Deposits
Growth in Deposits (RUB bln) Composition of Client Deposit Portfolio
Deposit Base
22
Continued diversification of deposit base with the following sources of state funding available: CBR funding (unsecured and secured loans, repo transactions), Ministry of Finance and funds of state-owned corporations
Authorised bank to bid for the funds of the City of Moscow placed on a tender basis.
By Deposit Type
By Customer Type
* Source: Bank of Moscow, IFRS Consolidated Financial Statements as of December 31, 2009.
10,0%
15,4%
32,5%
41,5%
IndividualsFederal Budgets + Regional FundsState Ow ned OrganisationsCorporate entities
Financial Overview
Profit and Loss (RUB bln)*
Profit & Loss Highlights
23
1,0%1,7%1,8%
0,1%
5,3% 5,0%
5,3%
1,9%
0,1%
22,6%20,4%
11,8%
0%
1%
2%
3%
4%
5%
6%
2006 2007 2008 2009-10%
-5%
0%
5%
10%
15%
20%
25%
Return on Assets Net I nterest Margin
Return on Equity
Selected Profitability Ratios*
Cost/Income Ratio* Operating Income (RUB bln)*
30,424,9
18,3
46,3
51,20%
46,08%
49,28%
30,93%
0
10
20
30
40
50
2006 2007 2008 2009
30%
35%
40%
45%
50%
55%
60%
65%
I ncome Cost/ I ncome
* Source: Bank of Moscow, IFRS Consolidated Financial Statements as of December 31, 2009.
14,119,1
28,4
1,6
(3,7)
3,1
4,3
5,8
31,31,1
9,5
5,5
2006 2007 2008 2009
Net commission incomeNet income from trading operations and other incomeNet interest income
40,9
66,8
90,9
121,6
13,90%
18,90%
14,80%
13,3%
-10
10
30
50
70
90
110
130
31-Dec-06 31-Dec-07 31-Dec-08 31-Dec-2009 0,0%
5,0%
10,0%
15,0%
20,0%
Total capital
Total capital ratio
Financial Overview
As of December 31, 2009 the Bank’s total capital position was sound with a total capital ratio (Basel 1 Accord) of 18.9%.
High quality of capital: Tier 1 Capital of RUB 86,6bn with the Tier 1 ratio of 12.8%.
The 13th share issue was completed to boost the capital by RUB 20 bln in July 2009. As of January 1, 2010 the CAR (CBR N1) stood at 16.11%.* This is well above 10% minimum limit set by the Bank of Russia.
On August 3, 2009 the Supervisory Board of Vnesheconombank (VEB) decided positively on extending a subordinated loan for RUB 11.1 bn to the Bank, which will further strengthen its capitalization.
Capital Base (RUB bln)Capital Adequacy
Capital Adequacy
24• Source: Bank of Moscow, IFRS Consolidated Financial Statements as of December 31, 2009
min 8%
(Basel 1
Accord)
Contact Information
Address: 8/15, bldg. 3, Rozhdestvenka str., Moscow 107996, Russia
Telephone: (7 495) 745 80 00, 925 80 00 Facsimile: (7 495) 795 26 00
E-mail: [email protected] Web site: http://www.bm.ru
Telex: 485306 MBNK RU, 614475 MBANK RU SWIFT: MOSWRUMM
Reuters dealing code: MMBM
25
INTERNATIONAL DIVISION FINANCIAL INSTITUTIONS
Mr. Alexander NAUMOV Mr. Vladimir VASYATKIN
Managing Director General Manager
Tel.: (7 495) 745-8000, ext. 1168 Tel.: (7 495) 745-8000 ext. 1141
Fax: (7 495) 624-1387 Fax: (7 495) 621-1290
E-mail: [email protected] E-mail: [email protected]
TRADE FINANCE FUNDING AND INVESTOR RELATIONS
Mr. Alexander MUSIYKO Mrs. Anastasia BELYANINA
General Manager Managing Director
Tel.: (7 495) 745-8000, ext. 4217 Tel.: (7 495) 745-8000 ext. 1149
Fax: (7 495) 624-1387 Fax: (7 495) 795-3080
E-mail: [email protected] E-mail: [email protected]