Why banks are running out of Russia

To tell about the love for the Russian market the Swedish Swedbank Group began in 2004, and the Flemish group KBC - in 2007. Swedes come to us modest Belgians literally blew up the banking sector deafening expensive private absorption Absolut Bank. In March 2005 the first da Swedbank Group acquired a small credit institution with the symbolic name "Quest", in April 2007, the Belgians announced the purchase of "Absolute." Deputy Head of information and analytical support Probusinessbank Valery Piven recalled that the issue price with the "Quest" was 99 million rubles from the ratio of cost of capital (P / Bv) 2:1, and KBC Bank Absolut paid for 761 million euros (about $ 26, 6 billion rubles) by a factor of about 4. In the first case of foreigners, in fact, started a start-up, the second - have become the masters of a large bank with a large regional network. But all the same features in common with the passage of time combined the two projects: the European pedantry, the orange color in the logo and a very big ambitions. Orange songs. Even in the midst of the crisis in May 2009, Swedbank Group on behalf of a shareholder of the Russian subsidiary Swedbank AB are not too lazy to formally refute the information on plans to cut part of Swedbank. However, in an emotional press release stated that "the bank appreciates its customers in Russia and will not change its development strategy on the Russian market." To the credit of Absolut Bank, it is worth noting that in November 2009 when it became aware of the intention to sell the FAC have become "non-key" Russian and Serbian banks group, the leaders did not spare the time to explain and did not deny the obvious. Then predpravleniya Absolut Bank Nikolay Sidorov just elaborated on the position of shareholders and announced that KBC Group «determined with the decision on business development in Russia after 2011." Now, when it is clear that to realize the original intent of capturing the Russian market has neither the Swedes nor the Belgians, all statements and promises of Europeans began to resemble the French model plans for 1812. Then Napoleon forgot to insulate their soldiers, and got burned on anything, but the Europeans so enthusiastic about the rapid growth of the Russian banking market, the risks of possible force majeure considered significant. How else to explain the inexhaustible generosity of those same Belgians who do not restrict the "Absolute" in funding (the parent company share in the structure of bank liabilities is still about 50%). But to force majeure also had to prepare, focusing primarily on their own weaknesses. Valery Piven recalls that one of the reasons for the losses incurred can be called a weak diversification of loan portfolio. At the dawn of September 16, 2008, when came the global economic crisis, and Absolut Bank and Swedbank large proportion of the portfolio assets were loans related to real estate (mortgages and developers). "KBC while still unsuccessful," went "- on the eve of the crisis, the new owner simply may not have had time to re-work for the bank to make it more resistant to fluctuations in the economic cycle" - the expert emphasizes. The desire of both banks to enter the top 20 and top 25 by assets, to become the most profitable, most service and the most beautiful to date financial results overlap. If our bank before the crisis showed the good results that made the investment a success, then, according to the Central Bank, in 2009-2010, the bank has suffered losses in an amount exceeding the previously obtained profits. With regard to the PIC, then the date of purchase of Absolut Bank's only 2007 and 2008 were for bank profitability. According to CB, for 2009-2010, the bank received a loss of about 9 billion rubles-lei. And the mood of employees of both banks are, of course, not orange. Buy & Sell. What if the business did not go? Options are few: to kill or sell. Swedbank, apparently, went to the first path, Absolut Bank - in the second. Predpravleniya Absolut Bank Nikolay Sidorov (one of the few remaining members of the bank of the old team), recalled "F.", which, according voiced in 2009 claims, the bank's shareholders consider-ryat after 2012 the question of the possible withdrawal of the Russian market. And now, according to Sidorov, Absolut Bank is not in talks to sell: "We have aggressive plans to grow retail portfolio, that portfolio and the replacement of the corporate unit." Already the bank was able to February 25 has reported that up to 2010 took 11th place in terms of the mortgage portfolio (2.8 thousand loans totaling 4.2 billion rubles fields). "In 2011 the bank plans to strengthen its position in this market, which considers it a priority" - said in a release. Swedbank, even after publication of the annual report Swedbank Group February 8 did not become more sociable. Responding to an official request "F." The press service of the bank disregarded the question: "How old is our bank plans to work in Russia?" - "According to the adopted strategy of" Swedbank "in Russia is planning to develop the direction of working with corporate clients." It seems that the only interest that has stayed here at the credit institution - a company with an annual turnover of 7 million euros. From other clients Swedes disposed artistically and vividly. To the end of "killing" retail Swedbank remains to persuade about 50% of the total number of holders of private deposits (total at the end of January, the bank had about 1,000 depositors) ahead of time to take the money and quickly "get away" from the cash management of customer service. Including zarplatnikov, including many members of Swedish companies. According to market participants, the stagnation of corporate direction and all other operations of Swedbank in Russia - is also a matter of time. Action has been taken. On January 1, 2011 our bank has raised rates for the RKO, and share with the provisional name "take away your contribution ahead without loss of interest" was completed on February 18. Starting from October 27, 2010 the client can pick up without losing the contribution of return at the rate specified in the contract. After February 18 early termination is carried out on a contract basis and will accrue interest at a rate of 0.1% per annum. "We emphasize that the bank does not charge any fees for early withdrawal of contributions in full accordance with Russian legislation", - said the press service. As for the cost of other services, then it has grown "very, very." In late December 2010, the site of Swedbank letter appeared "about any changes in the retail business management services to JSC" Swedbank "." In his opening remarks, customers reported that they are respected, valued, and therefore pre-informed of the in force "corrections." "First of all, it involves two areas: it turns out the service and the fees" - the letter says. Rates are really prohibitive, and the word "service" in the context of the events described sounds like a bad joke. So, now in Swedbank maximum fee for cash withdrawals from the account is 25%. In addition, new account maintenance fees of up to 500 rubles a quarterly basis and for making money at the expense of up to 15% (both before services are provided free of charge). Absolut Bank, meanwhile, business is not shifting. By the time a possible sale is highly probable that the asset will look pretty good. While the figures are certainly not very encouraging. According to the rating the Banki.ru, only c 1 January to 1 February 2011 Assets net of a credit institution decreased by 1.37%, credit portfolio - by 2.4%, while deposits "physicists" - by 3.5%. If you look at the dynamics of the year, assets declined by 16%, the loan portfolio - 22% of private deposits - by 40%. However, the profit finally became positive. "The increase in profit is due on February 1, in the first place, the dissolution of reserves, in early 2011, was settled a few large loans and some restrukturirovano.Chto on reducing key indicators, especially down the loan portfolio, which is a deliberate policy of the bank - we reduce the concentration on high-risk segments (including real estate) », - says Nikolay Sidorov. At Swedbank, according to IFRS, on February 1, profits also came out of the negative zone. But this is hardly good news has some value.