Mr. Anton Solovyev, President of the Ural Bank for Reconstruction and Development, won the The Banker of the Year nomination in the Person of the Year annual award organized by Delovoi Kvartal Magazine (Yekaterinburg). The award ceremony was held at the State Academic Theatre of Opera and Ballet on November, 28 in Yekateriburg.
Person of the Year is a unique regional award, winners of which are determined by the representatives and experts of business society of the city. The Person of the Year is awarded to the senior executives working in Ural region for the professional achievements that effect sector’s growth, for implementation of innovative projects and technologies, support of social projects of the city and the region.
“This award is, no doubt, one of the most prestigious one. It marks high achievements not only of company’s executive officer, but of the whole team. For the last two years UBRD made a great step forward: we have expanded our retail outlet network to 270 in all regions of Russia, we have made all business processes more technological, and have improved all main indicators of Bank’s performance. And the forthcoming 2013 will be no less intense and rich in new projects. Surely, in 2013 our developments will be highly appraised by business society, and more importantly by our clients”, says Anton Solovyev, President of UBRD.
As of October 1, 2012 the Ural Bank for Reconstruction and Development holds 39th position in the ranking Top 200 Largest Russian Banks by Net Assets released by Kommersant DENGI Magazine.
UBRD occupies 27th spot in the list of Top 100 Largest Private Banks (by equity size) and in the list of Top Retail Banks, also released by DENGI Magazine.
As of the first nine months of 2012 the growth of key performance indicators of the Ural Bank for Reconstruction and Development has exceeded the average development rate of the Russian banking system.
Since the beginning of the year shareholders' equity was significantly increased up to RUB 12,130 bln (+25.3%, while the banking system average is 7.7%). as of October 1, 2012 the Bank's assets totaled RUB 126,9 bln increasing by 25.9% since the beginning of the year, and by 19.1% in the third quarter (the national average is 10.2% and 3.6% respectively). Thus, the assets of UBRD growth two and a half times faster than the in the banking system in the first nine months of 2012, and five times - in the third quarter. Net income of UBRD amounted to almost RUB 1 bln for the same nine month period.
Asset growth is mainly driven by a significant increase in the loan portfolio of UBRD (as of October 1, 2012 RUB 74 bln, the increase in the first nine months is 30.7%, and for the third quarter is 11%). Good growth rates is demonstrated by the SME loan portfolio (63.1% YTD) reaching almost RUB 4 bln by the end of the third quarter. As of October 1, 2012 the retail loan portfolio was RUB 30,5 bln (+50.3% YTD), while the share of loans to individual enterpreneurs in the total loan portfolio has increased from 35.8% in the beginning of the year to 41.2% as of the first nine months 2012. And the number of active cards exceeded 1 million.
The liabilities side shows certain dynamics as well. In particular, as of October 1, 2012 retail deposits reached RUB 54,2 bln, growing since the beginning of the year by 19.7%, and in the third quarter by 5.4% (the average rates of the banking sector are 1.8% and 10% respectively). Corporate accounts for the third quarter amounted to RUB 22,4 bln (+7.8% YTD and 16.4% compared to the second quarter), while the banking sector growth rate is 4.6% and 1.5% respectively.
“Performance of UBRD during the three quarters has showed that the chosen business model and strategy of the bank are right. Now, as of October 1, 2012 we have already achieved many targeted indicators planned for the year”, said Mr. Anton Solovyov, President of UBRD.
On October 15, 2012 the Ministry of Finance of Sverdlovsk region held open electronic auction. There were three lots for bidding: opening and maintenance of deposit accounts, and fundraising of regional budget of Sverdlovsk region into deposits.
The Ural Bank for Reconstruction and Development has made the best offer and won a tender for the state 12-months contract up to RUB 1 bln.
“Raising public funds strengthens positions of UBRD in the market. Furthermore, funds of the regional budget remain in the region and this improves the investment climate of the Sverdlovsk region”, says Mr. Evgenii Lubimov, head of external sales division.
The secondary offering of RUB bonds of the Ural Bank for Reconstruction and Development, UBRD 02, was closed on November 7, 2012 on the MICEX Stock Exchange. Bonds presented by the holders have been sold in the secondary market in full. This secondary offering was arranged by Promsvyazbank, which has aslo been the arranger of the initial offering of this issue in April 2011.
During the session seven deals were closed resulting in 553,936 bonds sold at par totaling in RUB 555,509,178.24, the amount received on November 2, 2012 for the offer. Moreover, in the secondary market the issue was oversubscribed twice and amounted to 1.134 mln bonds.
Currently there are two bond issues outstanding: commercial papers UBRD BO-1 and bonds UBRD 02 with a total nominal value of RUB 4 bln (RUB 2 bln each, and both placed with oversubscription) with annual and semiannual coupon payments respectively. There are three more commercial paper bonds registered for a total amount of RUB 8 bln to be placed in 2013 given favorable market environment.
Overall amount paid was RUB 9,526,000 with RUB 47.63 per one bond with a face value of RUB 1,000.
UBRD’s bond issue of series 02 for the total amount of RUB 2 billion was placed on the MICEX Stock Exchange in April 2011. Bonds are included in the Lombard list of the Bank of Russia, which allows bondholders to obtain refinancing in the Central Bank.
Current fourth coupon was announced by the Issuer of 11.5% per annum, which is RUB 57.66 per bond. After repayment of the fourth coupon a put option is offered to bondholders due in May 13, 2013.
Earlier on October 2, 2013 UBRD has placed a first bond issue of serie BO-1 for RUB 2 billion. 40 primary investors participated in the placement and the demand for the bonds has exceeded supply by 25%. Thus, at present two RUB bond issues with the annual and semi-annual duration are outstanding. Three more bond issues for the total amount of RUB 8 billion are registered, which are planned to be placed in 2013.
International rating agency Standard & Poor’s affirmed the credit rating of the Ural Bank for Reconstruction and Development at the level B/B with stable outlook. Agency analysts marked the Bank’s good market position and assessed liquidity as adequate. “We expect that in the medium term UBRD will maintain a relatively high proportion of liquid assets that would provide it some cushion in the event of a moderate reduction in liquidity”, says the release of the Agency.
The report notes that in the medium term UBRD can expect an increase in assement on a number of items, in particular, risk management. “The upgrade is likely to be due to a sustained improvement in diversification of the loan portfolio and the steady increase in the quality of assets to the industry average level,” states the release.
Analysts marked the Bank’s plans to increase the share of retail loans in the portfolio from 41% (as of September 1, 2012) to two-thirds of total loans in 2015. “We believe that the successful implementation of this strategy will allow the Bank to increase the diversification of operations and improve the ability to generate profit”, said in the press release. It should be recalled that according to the development strategy during next three years UBRD plans to double the number of customers to one million, triple the number of offices up to 550 sales points, and increase net operating income from 13 to 45 billion rubles.
The Ural Bank for Reconstruction and Development closed the placement of bonds (series BO-1) at 100% of face value for a total of RUR 2 bln with the first and the second coupon period at 12.5% on October 2, 2012.
Arrangers of the issue, Bank Uralsib and Russian Agricultural Bank, held bookbuiding from 24 to 28 September 2012 resulting in 41 bids on the coupon yield in the range of 12.25%-12.5% p.a. The initial demand has exceeded supply and amounted to RUR 2.5 bln.
On Octoner 2, 2012 47 deals were concluded, the whole issue was placed among the initial investors.
“I think that the placement rate is adequate. The large number of investors shows that the placement of the loan was market-based. The investors have an appetite for bank risk. Therefore, we expect a good enough investment activity in this issue in the secondary bidding”, said Mr. Vladimir Zotov, Head of CIS FI and Investment services.