Sberbank information (materials)
Introduction to the Explanatory Note
Download 1.41 Mb.
|
- Navigate this page:
- Core Business of Sberbank. Banking products. Licenses
- 2011 Results in Brief
Introduction to the Explanatory NoteThis Explanatory Note
Figures provided in the Explanatory Note are for 2011 and 2010. Their values are comparable and commensurate. The Bank's management resolved to publish this Explanatory Note as part of the Annual Report posted on the Bank's website (www.sberbank.ru). Forms of the Annual Report (the Statement of Financial Position, the Profit and Loss Statement, the Cash Flow Statement, the Statement of Capital Adequacy, Allowance for Doubtful Loans and Other Assets, and details of reserve requirements) are openly published and posted on the Bank's website within its Annual Report subject to Directive #2172-U26 of the Bank of Russia.
Core banking activities:
Sberbank offers its clients a wide range of banking products and services within the core activities listed above. In addition to banking operations, the Bank carries out the following types of transactions:
Licenses under which Sberbank carries out its operations are listed below:
Information on the Bank's involvement in the system of Deposits’ Mandatory Insurance of retail clients in banks of the Russian Federation Sberbank of Russia is a member of the deposit insurance system. Sberbank was entered in the Register of Banks Enrolled in the Deposit Mandatory Insurance System on 11 January 2005. Sberbank makes quarterly insurance payments to the Fund of Deposits’ Mandatory Insurance as required by Russian laws. In 2011, Sberbank's expenses related to charges paid to the Fund of Deposits’ Mandatory Insurance reached 19.8 bn Rubles, 21.5 % more than in 2010. This growth resulted from an increase in funds raised from retail clients.
The Russian economy developed in 2011 against the backdrop of ambiguous foreign economic conditions. Global trends in international financial markets were primarily related to low or negative growth rates in developed countries, the economy of which is characterized by a significant degree of foreign and domestic debt. In the US, these problems manifested themselves in a slow recovery of the economy in the context of political controversies. Europe suffered from an intensifying debt crisis. As a result, the volatility of the Russian stock and forex markets spiked. In particular, in the second half of the year the ruble depreciated from 28.1 RUB/USD in July to 32.2 RUB/USD by year's end in the context of a worsening financial crisis in the Eurozone. The Russian economy continued its recovery growth. According to preliminary estimates of the Federal Service for State Statistics, in 2011 GDP was up by 4.3 %. It was mainly boosted by consumer spending and restoration of enterprises' stocks. In general, the 2011 growth was based on domestic demand, both in the consumer and investment segments. Foreign demand fell significantly in conditions of global instability, causing deterioration in export-oriented sectors of the Russian economy. Growth slowed down in the extractive industry; growth in the processing industry failed to regain pre-crisis levels. Real income of the population barely increased in 2011. That said, retail trade turnover grew 7.2% as a result of realization of deferred demand, growth in consumer lending and a lower rate of savings. This had an impact, among other things, on the dynamics of retail services of Russian banks:
Russian banks were actively collaborating with Russian companies and enterprises with 26% more funds raised from and 27 % more loans granted to them. Sberbank also successfully cooperated with corporate clients, especially in terms of lending, where the Bank managed to enhance its market presence from 31.3 % to 32.9 %. In general, development of the Russian banking system in 2011 was distinctively marked by the fact that lending growth rates were higher than client deposit growth rates. This applied additional pressure on the liquidity of the banking system in the second half of the year. The first half of the year was characterized by a surplus of bank liquidity. In order to reduce it and dampen down inflationary pressure on the economy, the Bank of Russia starting taking measures in February 2011 intended to tighten monetary and lending policy: banks' reserve requirements were raised three times during the year, the refinancing rate was increased twice, the deposit rate of the Bank of Russia was increased four times. The interbank market's liquidity sharply fell in Q3 in the context of global instability and difficulty that Russian borrowers faced in raising foreign finance. Interbank interest rates significantly grew with MosPrime rates for overnight loans rising from 2.9% early that year to 6.5 % in December. The Bank of Russia sharply increased amounts available for REPO transactions, and the Ministry of Finance made deposits in banks in order to maintain low lending rates in the productive sector. Clients' funds remained the main source of funding for Sberbank. Nevertheless, like in the banking system overall, their growth rates lagged behind lending rates. In this respect, Sberbank took measures to raise an additional amount of liquid funds. Sberbank obtained additional ruble liquidity by attracting funds from the Bank of Russia through direct REPO transactions, having the Bank of Russia grant secured loans27 and reducing investments in government securities (the volume of ruble-denominated government securities in the Bank's portfolio lost over 400 bn rubles during the year). Additional liquidity in foreign currency resulted from issuing a bonded debt and obtaining a syndicated loan, and through trade finance operations. Positive sentiment prevailed in Q1 2011 in the Russian stock market. Nevertheless, subsequent events such as an escalating lack of confidence in further growth of the global economy and the continuing crisis of trust in the Eurozone caused global stock markets to plummet twice, in August and September. Ultimately, the MICEX index was 17% below early 2011 levels by year's end. Sberbank's28 market capitalization also fell from 76.1 to 54.8 bn US dollars though the Bank remained in the world’s Top 20 banks in terms of market capitalization . The quality of loan portfolios of banks continued improving in 2011. During the year, the share of overdue debt on loans granted to legal entities and retail clients in the banking sector decreased from 5.5 % to 4.6%. Sberbank was also particularly focused on the quality of its portfolio. It continued operations as part of business processes launched back in 2010 to recover bad debt29. Systemic collaboration with large, medium, small and micro business on bad debt helped to reduce legal entities' overdue debt by 33 bn rubles. Overdue debt of retail clients added 2.3 bn rubles which, however, is insignificant as compared to the total portfolio worth in excess of 1.8 trillion rubles. The fixed-term loan portfolio was growing fast. All measures taken together allowed the Bank to reduce the share of overdue debt on client loans from 5.0% to 3.4% and improve the quality of the loan portfolio compared with the aggregate portfolio of the banking system. In 2011 Sberbank restored reserves for a number of loans as part of planned arrangements with bad assets. As a result, expenses incurred in creating reserves significantly fell by year's end even though the Bank continued creating reserves for new loans. This had a positive impact on the growth of earnings which hit a new record and reached 46.5 % of the total earnings of the country's banking system30. Sberbank's share in different segments of the financial market:
*The 2010 figure adjusted for changes made in 2011: funds in precious metals excluded While dealing with relevant issues related to the current situation in the market and the economy as a whole, Sberbank continued developing within the approved Strategy31: 2011 became the third year of implementation of the Strategy, and its progress is overall successful and within the schedule. In retail business, Sberbank managed to reduce lines significantly and improve the quality of service. The share of clients that have to wait in line for over 15 minutes32 fell from 41% to 13% in a year. Federal campaigns of sales and retail client loyalty programs launched in late 2011 had a sizable impact. In December, retail clients were granted loans totaling over 190 bn rubles which is the maximum figure for the Bank. This immediately strengthened Sberbank's position in the retail loans market (with the Bank's share growing 0.6% in December) and pushed the Bank up to 1st place in the credit card market in terms of debt volume. The Bank was actively promoting its services provided via remote channels throughout the year. As a result, the number of active consumers of these services increased several times: 3.4 times for Sberbank Online, 3.8 times for mobile banking, and 2.4 times for online trading. By the end of 2011, Sberbank managed to increase significantly its market share in lending to corporate clients, by 1.6 % to 32.9%. In the Bank’s opinion, the growth of its share stems from implementation of strategic initiatives in collaboration with corporate clients. For example, a range of trade finance products was developed for corporate business clients. As a result, Sberbank's share in the market of trade finance and documentary business reached about 40%. The Trust loans granted under the Loan Factory technology was in particular demand among clients. Over 48,000 clients received them in 2011. Services provided to corporate clients via remote channels are actively developing. The number of users of remote banking services systems for legal entities exceeded 260,000 clients. In 2011 Sberbank continued developing its overseas network.. While strengthening its subsidiary banks' positions in CIS markets, the Bank started creating growth points in Central and Eastern Europe and Switzerland. Sberbank created a new business unit within the program of integration with Troika Dialog — Wealth Management. Its projects include development of broking operations and asset management operations. Rapid growth of its business is accompanied by improvements in support functions. In particular, in 2011 the Bank opened Europe's largest data processing center, and work continued to bring together IT systems of territorial banks. 5 new centers supporting client operations were opened in 2011. Centralization and standardization of operating processes and functions added to growth in performance of business processes. The Bank completed the diagnostics stage and seriously set about the implementation of a program of end-to-end optimization of functions performed by supporting divisions. High development rates of business and supporting functions require that an adequate controls and risk management system should be built. By the end of 2011, Sberbank managed to improve significantly the risk management system. For example, it allows assessing risks of over 50,000 retail loans a day with an invariably high quality of the loan portfolio. When pursuing its development strategy, the Bank is especially focused on developing the HR management system. Employees are regularly tested to make decisions on new assignments and personnel rotation. About half of the Bank's entire staff undergoes annual training within different professional development programs. The transition continued to a grade-based system and a new incentive and remuneration system, introduced in over 4,000 city internal structural divisions. Sberbank consistently develops management reporting tools in order to make sure that right management decisions are made. Work is done to build a management information system (MIS) and a centralized data repository, a program for implementation of a balanced scorecard system and development of standard management reports was launched.
2011 was completed by Sberbank with the following economic figures33:
Calculated pursuant to Regulation #215-P 34 of the Bank of Russia, the Bank's capital grew 22.1% in 2011. The source of the growth in the capital was the net profit earned Sberbank's Ratings Awarded by International Agencies Sberbank's ratings compared with ratings of the Russian Federation:
On 8 April 2011, Fitch Ratings upgraded Sberbank's individual rating from C/D to C and later, on 25 January 2012, discontinued these ratings for all financial institutions by replacing them with the Sustainability Rating. Sberbank was awarded the Sustainability Rating of bbb. This rating describes the Bank's creditworthiness without external support.
Directory: common common -> Anbookstore com Copyright 2013 common -> Chapter 1: Property as rights, not thing common -> The Promise of Accessible Textbooks: Increased Achievement for All Students common -> Proceedings of the national assembly common -> Grade 8: Module 3B: Unit 2: Lesson 17 End of Unit 2 Assessment, Part 1 common -> Advanced 3G/4g vehicle Wi-Fi Router hw-wr1642 common -> Common Core and headsets: what you need to know Download 1.41 Mb. Share with your friends:
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||