www.expobank.ru ANNUAL REPORT 2014
BUSINESS IN THREE DIMENSIONS ANNUAL REPORT 2014
The Best Russian Bank
Expobank has received the EMEA Finance Europe Banking Award, nominated as the Best Bank Operating in Russia, based on 2014 results.
EMEA Finance Magazine is an internationally recognized financial publication telling of the most important events in the financial markets in Europe, the Middle East and Africa. Every year the magazine gives out ‘Europe Banking Awards’ to the best banks. When deciding on the winners, EMEA Finance experts rely on such criteria as the economic performance, increase in profits and international business expansion. Expobank 2014
ANNUAL REPORT
CONTENTS General Information on the Report
The Report has been prepared by Expobank SUMMARY CORPORATE GOVERNANCE Limited Liability Company (‘Expobank’). The consolidated data cover the period General information on the Report 3 Accountability and efficiency 40 from 01 January to 31 December 2014. Assets and partner banks 6 Risk management 42 Geography of operation 7 Information openness and transparency 48 Key Topics of the Report Contact Details Expo brand footprint globally and across Russia 8 Social policy and HR management 49 History of the Bank 10 The Report highlights performance indicators included in 29 Kalanchevskaya Street, bldg.2, Moscow, 107078 Expobank’s 2015–2017 Strategy. Tel: +7 (495) 228 31 31 Standards Email: [email protected] STARTEGIC REPORT FINANCIAL STATEMENTS 24/7 Information Centre: The report has been prepared based on Expobank +7 (495) 231 11 11; +7 (800) 500 07 70 2014 IFRS Statements. Address of the Chairman of the Board of Directors 13 Independent Auditor’s report 60 Website: www.expobank.ru Address of the Chairman Statement of financial position 62 Ratings of the Management Committee 15 Statement of Comprehensive Income 64 In May 2014 International Rating Agency Fitch Ratings Strategy, Mission, Values 18 Statement of changes in equity 66 upgraded the Bank’s National Long-Term Rating to “BBB”, Our activities 19 with its International Ratings affirmed at “B”. The ratings were Statement of cash flows 67 affirmed in December 2014. Key events in 2014 20 In November 2014 Russian Rating Agency RusRating upgraded Financial results 21 the Bank’s credit ratings to “BBB-” (International Scale) and Overview of Russian economy in 2014 24 to “AA–” (National Scale), Outlook Stable Strategic goals for 2015–2017 27 GENERAL Core Business Private Banking / Expobank Premier 30 Treasury 31 Addresses / Contacts 69 Offering a whole range of banking services to corporate clients and affluent private customers are among the Bank’s priorities, Corporate banking 36 as well as acquisition and consolidation of banking assets. The M&A 38 Bank operates under General License for Banking Operations No.2998 of 06 February 2012 (replacement of License No.2998 Regional policy 39 of 02 December 2008) issued by the Bank of Russia (CBR). The Bank participates in the government’s deposit insurance programme introduced by Federal Law No.177-FZ dated 23 December 2003 ‘On Insurance of Household Deposits with Russian Banks’.
2 www.expobank.ru 3 INTERNATIONALITY
Business and finance have no borders. Despite differences in traditions and cultures businessmen Prague Stock Exchange Moskva-City from various countries are able to find common is the second largest stock exchange in the CEE ‘Moskva-City’ Moscow International Business Center is language. Expobank opens up the way to the European countries. Though the first commodities and stock the biggest business area both in Moscow and Russia. and world markets to its clients and is ready to be exchange in the Czech capital was founded yet in 1861, The country’s highest skyscrapers — Mercury City Tower their guide in new directions and new opportunities. the modern Prague Stock Exchange is relatively young: (338.8m), Eurasia Tower (308.9 m), Moscow Tower We are familiar with all subtleties and nuances trading started on 6 April 1993. (301.8m) — have been and are still constructed. of business cultures in various countries, and we are happy to share this experience. Everywhere, we speak one common language with business people — the language of growth and development.
Prague, the Czech republic Moscow, Russia
Riga Stock Exchange
The stock exchange is owned by Swedish-Finnish OMX Group which also operates exchanges in Helsinki and Stockholm. The neo renaissance stock exchange building was constructed in 1852–1855, designed by architect Harald Julius von Bosse.
Riga, Latvia Expobank 2014
ANNUAL REPORT
Assets and Partner Banks Geography of Operation
The banks are represented in three “Clients’ business value growth leads to the Igor Kim regions — Russia, the Czech Republic increase in the shareholder value of the Bank. Chairman of the Board of Directors, and Latvia — and operate under That is why each of the credit institutions is Expobank LLC (Russia) a single corporate name of Expobank. result-oriented and focuses on offering the most Chairman of the Supervisory Board, advantageous opportunities. Partner banks Expobank CZ (Czech Republic) Each of the credit institutions is controlled by Igor Kim and form new access points for Russian clients is a financial partner of the Russian credit institutions. This Chairman of the Board of Directors, provides the clients of our bank in Russia with both prompt to global financial centers, provide operational AS Expobank (Latvia) execution of transactions in Russia and with a whole range efficiency and consultancy expertise”. of opportunities in European countries and in Hong Kong. Igor Kim is an international strategic investor who has success- fully completed over 30 M&A deals both with Russian partners The banks are focused on corporate banking, M&A deals and on and global financial institutions. servicing export and import transactions of companies including Igor Kim those promoting import substitution policies and development of joint businesses in the territories of the brand presence.
IGOR KIM SUCCESSFULLY CLOSED Barclays (UK) OVER 30 M&A DEALS WITH GLOBAL Santander (Spain) Morgan Stanley (USA) FINANCIAL INSTITUTIONS: West LB (Germany) VR Leasing (Germany) LBBW (Germany)
THE FOLLOWING ASSETS HAVE LLC ‘SIBBUSINESSBANK’ (Surgut) BEEN PURCHASED IN THE RUSSIAN Commercial Bank ‘STROMCOMBANK’ Limited (Krasnoyarsk) Kirill Nifontov Māris Avotiņš Ilya Mitelman SECTOR RECENTLY: Commercial Bank ‘MAK-Bank’ LLC (Moscow) CEO, Russia CEO, the Czech Republic CEO, Latvia from OJSC ALROSA Diamond Mining Company.
Moscow COMMERCIAL BANK ‘MAK-BANK’ LLC Expobank LLC EXPOBANK CZ AS EXPOBANK Surgut is a dynamically developing bank that has been operates in the Czech banking market since 1991. is one of the oldest banks in Latvia. It was founded operating in the Russian banking market since The bank is focused on provision of complex prod- in 1991. The Bank’s major task is to be a reliable LLC ‘SIBBUSINESSBANK’ 1994. ucts and services. This covers corporate banking and professional financial partner to its customers Krasnoyarsk services incl. treasury services, real-estate financing and clients, to provide them with top quality and Its priorities are offering a whole range of banking and export and trade financing as well as a broad speedy service, and to ensure security and stability. COMMERCIAL BANK ‘STROMCOMBANK’ LIMITED services to corporate clients and affluent private range of private and personal banking services. The service standards have already been appreciated customers. The Bank focuses on providing banking Expobank CZ takes pride in being able to offer by clients from Russia, CIS and Europe operating services backed up by an extensive experience custom-made solutions and in its great care to detail in mining, manufacturing, finance, trade and other of successful deals involving funds raising, M&A’s when providing its clients with intellactual products industries. and business restructuring for Russian and interna- and services. THE PURCHASED FINANCIAL INSTITUTIONS tional companies. About 7.5 thousand companies and over 100 thousand individuals are among the WERE MERGED INTO EXPOBANK LLC Bank’s customers and clients. (RUSSIA)
6 www.expobank.ru 7 Expobank 2014 1
ANNUAL REPORT Summary
“The Bank’s team possesses qualitative “We see great potential for the development Expo Brand Footprint Globally expertise and competences in M&A deals. of the Bank’s and its clients’ businesses in Ensuring development for the Bank, growth in its the Asian market, namely in such segments as and Across Russia business volumes and profitability, and expansion China, Malaysia, Indonesia. We think that the of geographical footprint through M&A deals are Bank’s products and services, especially highly our key business goals. The synergy effect from efficient servicing of payments with a remote Expobank LLC (RUSSIA) their implementation enables us to develop at access option, will be in great demand” the rate exceeding the market average”.
Assets Ilya Mitelman CEO of AS Expobank as of 2014 Kirill Nifontov 51.9 CEO of Expobank LLC RUB BLN year-end THE CZECH REPUBLIC Equity of RUB 6.9 bln, “We provide our clients with top quality financial return on equity LATVIA instruments and service. When performing of 22.5% Prague export and import transactions between Riga Russia and the Czech Republic, promptness Saint Petersburg and skilled support are among our competitive advantages”. EXPOBANK CZ (Czech Republic) RUSSIA Māris Avotiņš Assets Moscow CEO of Expobank CZ 750 as of 2014 Yakutsk EUR MLN year-end Perm Equity of EUR 94 mln, Surgut capital adequacy ratio Yekaterinburg of 24.8% Krasnodar Krasnoyarsk Kemerovo
AS EXPOBANK (Latvia) Novosibirsk Novokuznetsk Assets 490 as of 2014 EUR MLN year-end HONG KONG
Equity of EUR 68 mln, The Representative Office has been opened to support our clients capital adequacy ratio interested in expanding their businesses of 35.5% in Asia, especially in China.
8 www.expobank.ru 9 Expobank 2014
ANNUAL REPORT
The Jubilee Year 2014 — 20 YEARS IN BANKING
The Success Story ОКТЯБРЬ 2011
1994 March October February March 2012 2008 2011 2012 2012
Expobank Expobank was Bank was acquired Bank was AS EXPOBANK Russia’s first project on was founded acquired by by private renamed back (Latvia) full-scale technology outsourcing of banking Barclays investors headed to Expobank was acquired systems was implement- by Igor Kim ed. The transition was recognized by OUTSOUR CING RUSSIA AWARD-2013 as the best technology outsourcing solution in Russia in 2012
March June August September 2014 2013 2013 2013 2014
Merger of Merger of Russian Expobank acquired EMEA Finance Stromcombank Sibbusinessbank subsidiary LBBW BANK CZ recognized Expobank as to Expobank was to Expobank was of German from Landesbank the Best Russian Bank, completed completed VR LEASING Baden based on 2014 results. holding was Württemberg The Bank received the EMEA Finance Europe acquired (LBBW) Banking Award, nominated as the Best Bank Operating in Russia
10 www.expobank.ru 11 2
Startegic Report Address of the Chairman of the Board of Directors
Address of the Chairman of the Board of Directors
Dear shareholders, members of the Board, clients and partners,
The world economy in general and the banking sector in particu- Expobank’s active interaction with the partner banks in the lar are going through changes. Financial institutions are seeking Czech Republic and Latvia secured operational efficiency, con- efficient forms and means of being a success, with regulations sultancy expertise and new access points for Russian clients tightened, costs increased and with a global tendency for to global financial centers. All three credit institutions operating transparency. The Russian banking sector is not an excep- under the single brand are result-oriented and focused on offer- tion. Professional market players are adapting to the updated ing the most advantageous opportunities. This is supported geopolitical frame of reference taking into account risks and by a strong management and successful work of nonexecutive defining for themselves the most optimum business strategies. directors of world level. In 2014 the work of the Board of Directors of Exponank-Russia Russian Expobank has always demonstrated was focused on enhancement of decision-taking and strength- ening of control over adherence to the laws and recommenda- positive dynamics and every year it proves its tions of CBR. With requirements to the banking sector tight- competence and reliability building up long- ened, the top management paid and continues to pay special term relationships of trust with its customers attention to creditworthiness of corporate borrowers and and clients. to risk management matters. All taken measures were targeted at strategy implementation and creation of a robust platform for further business development. The year 2014 was a jubilee year for the Bank. 20 years of suc- cessful operation are marked with a number of transformations, On behalf of the Board of Directors I would like to thank the achievements, successes, with introduction of innovative and whole team of Expobank in Russia and wish them successful state-of-the art solutions. A team of responsible and profes- implementation of the goals set. sional top managers was formed. Their work is aimed to ensure the clients’ business value growth, which leads to the increase in the shareholder value of the Bank. Igor Kim Chairman of the Board of Directors Expobank LLC
www.expobank.ru 13 Expobank 2014 2
ANNUAL REPORT Startegic Report Address of the Chairman of the Management Committee
Address of the Chairman of the Management Committee
Dear shareholders, members of the Board, clients and partners,
Success factor for the Bank today is quality of customer Our plans stand out by their reasonableness as the Bank’s service based on reliability, skills of staff and on a high level team prefers steady development. We remain true to our of banking technologies. In 2014 our Bank earned comprehen- cause, our values remain unaltered — integrity, efficiency, open- sive income of RUB 1.7 bln, which exceeds the 2013 results ness to change. These principles form basis for relationships by 40.5%. Equity made RUB 6.9 bln, return on equity equaled with our clients, partners, team members and community. We 22.5%. develop; we improve customer service and do everything for you to feel comfortable and profitable to build up your relation- ships with the Bank. Profits of the Bank have been growing for the I would like to thank all team members of the Bank for the third year running and even with the market professionalism and responsibility with which we get down environment changing Expobank demonstrates to resolution of the most difficult tasks set by the present-day high rate of return while maintaining excess challenging environment in the financial markets. No doubt, liquidity and capital adequacy. the valuable experience we gained in the past year will be just another step to success, stable growth and prosperity of the Bank in future. One of the key elements for the year results was income from M&A’s. In September 2014 Expobank successfully closed the deal on acquisition of 100% voting shares in Czech LBBW Kirill Nifontov Bank CZ a.s. from Landesbank Baden-Württemberg. As a result of this acquisition Expobank gained over 30 thousand active CEO, Expobank LLC clients in Europe, an opportunity to service export and import transactions between Russia and the Czech Republic, and also a competence in working with German companies. Expobank CZ a.s. is characterized by a sound capital adequacy (CAR 24.75%), loan book quality, and also by a well-diversified asset structure and excess liquidity.
14 www.expobank.ru 15 Expobank 2014
ANNUAL REPORT Management Committee
Ernst Olga Kirill Dmitry Oleg Alexey Gulnisa Alexey Bekker Pugacheva Nifontov Ganushkin Novolodsky Fedotkin Ulanova Sannikov
Deputy Chairman Deputy Chairman Chairman of the Deputy Chairman Deputy Chairman Deputy Chairman Chief Deputy Chairman of the Management of the Management Management of the Management of the Management of the Management Accountant of the Management Committee Committee Committee Committee Committee Committee Committee of Expobank LLC Expobank 2014 2
ANNUAL REPORT Startegic Report Our Activities
Strategy, Mission, Values Our Activities
Mission and Vision
Mission of the Bank: Comprehensive income of We build the banking business designated to help clients to secure growth of their business TOP-30 1.7 value and to promote their financial soundness. RUB BLN Expobank is among top 30 biggest exceeds the 2013 result credit institutions in net profits by 40.5% Values of the Bank: in Russia, based on the FY2014 results
TEAMWORK EFFECTIVENESS, Clients’ Expobank LLC is a dynamically developing bank that has been liabilities of EFFICIENCY operating in the Russian banking market since 1994. 31.3 The Bank is among top 30 biggest credit institutions in net RUB BLN Engagement of each team member, sincere Focus on the best result with the help profits*. It has high credit ratings from leading rating agen- interest in the result achievement through of the most suitable methods. Constant cies. In December 2014 Fitch Ratings affirmed the Bank’s Clients’ liabilities grew by 19.6%. joint effort. Willingness of every person search of ways to achieve professional International Rating at ‘B’. In November 2014 RusRating Individuals’ funds grew by 43.0% upgraded the Bank’s credit ratings to “BBB-” (International to make a valuable contribution maintain- improvement and development Scale) and to “AA-” (National Scale), Outlook Stable. to RUB 18.7 bln ing confidential and respectful relations Its priorities are offering a whole range of banking services to corporate clients and affluent private customers. The Bank focuses on providing banking services backed up by an exten- Net interest sive experience of successful deals involving funds raising, income of M&A’s and business restructuring for Russian and international 2.6 OPENNESS, ETHICS, HONESTY companies. RUB BLN READINESS TO CHANGE AND INTEGRITY Net interest income increased by About 7.5 thousand companies and over 22.6% Openness to changes and appropriate Loyalty to ethical standards and principles. 100 thousand individuals are among the response to the necessity of introducing Demonstration of the firm intention to act Bank’s customers and clients. possible changes. The ability to accept in line with ethical principles, honestly various points of view and adaptability and decently abiding by professional code Operational costs to a new action plan approved of conduct and social standards decreased by 1.4 RUB BLN * According to the banks ranking which is 21.4% lower than the value made by the Interfax-Center for Economic Analysis as of 01 January of 2013. The Bank’s cost to income ratio 2015 in 2014 reduced to 41% as compared to 47% in 2013.
18 www.expobank.ru 19 Expobank 2014 2
ANNUAL REPORT Key Events in 2014 Startegic Report Financial Results
Key Events in 2014 Financial Results
Assets (bln RUB) Comprehensive income (bln RUB) ACQUISITION BANK ACCREDITED 38.5 48.0 51.9 1.0 1.2 1.7 OF LBBW BANK CZ WITH DIA 60.0 2 40.0 1 Expobank successfully closed Expobank is accredited with 20.0 the deal on acquisition Deposit Insurance Agency 0 0 of LBBW BANK CZ from to take part in tenders held 2012 2013 2014 2012 2013 2014 Landesbank Baden- to select agent banks Württemberg (LBBW) Growth for 2014: 8% Growth for 2014: 40%
Clients’ funds (bln RUB) Net loan portfolio less leasing (bln RUB)
20.4 26.1 31.3 16.7 27.8 26.5 35.0 30 8.1% 44.1% 30.0 20 25.0 10 During the year, the Bank’s Share of liquid assets in the 20.0 0 assets grew by 8.1% balance structure grew from 2012 2013 2014 to RUB 51.9 bln 33.8% to 44.1% 15.0 Growth for 2014: –5% 10.0
5.0 Liquid assets (bln RUB) BANK EQUITY 0 13.5 11.1 17.2 6.9 2012 2013 2014 20 OF BLN RUB Growth for 2014: 20% 15
Return on Equity of 22.5% 10
5
0 2012 2013 2014
Growth for 2014: 54%
20 www.expobank.ru 21 PUNCTUALITY
Timeliness and efficiency are the two most important qualities of a successful business. 24/7 access to international financial markets and freedom to act in them provide for continuity and efficiency of the transactions and deals concluded. Expobank cuts out delays. We value every second of our clients’ time irrespective of the time zones that separate us.
The Prague Chiming Clock The Kremlin Clock The Laima Clock (Laimas pulkstenis)
(Pražský orloj) The chiming clock mounted on the Spasskaya Tower is a pillar clock of an original tower-type design mounted is a medieval astronomical clock mounted on the south- of the Moscow Kremlin dates back to the 16th century. in the center of Riga at the beginning of XX century. ern wall of Old Town City Hall in the Old Town Square in The famous melody of its chime marking every hour and The name “Laima” and its art deco design were passed Prague. The oldest parts of the clock date back to 1410. quarter-hour was not composed on purpose — it was down to the clock from the confectionary factory The clock shows the year, month, day and hour, time of the conditioned solely by the structure of the bell tower itself. to advertise whose produce it was used. In 1999, in rise and setting of the Sun and the Moon, and also the At noon, midnight, 6 a.m. and 6 p.m. the National An- commemoration of the 800th anniversary of Riga, the position of the zodiac signs. The full hour chime is accom- them of the Russian Federation is played, while at 3 a.m., clock gained back its historical look. Today this clock panied by a short show in the traditions of the medieval 9 a.m., 3 p.m. and 9 p.m. it is the melody of the “Glory” is considered to be the most accurate clock in Riga as, toy theatre performed by moving mechanical figures. chorus from Mikhail Glinka’s opera “A Life for the Tsar”. twice a day, its rate is verified against satellite data. Prague, the Czech republic MOSCOW, RUSSIA RIGA, LATVIA Expobank 2014 2
ANNUAL REPORT Startegic Report Overview of Russian Economy in 2014
Overview of Russian Economy in 2014
Throughout 2014 Russian GDP was Besides, high geopolitical uncertainty In late 2015 the slide in GDP may slow down but as of the year-end this indicator will still be in the negative zone. Its Russian as per gradually slowing down. After a slight related to the conflict in the Ukraine and dynamics will still depend greatly on energy commodity prices. GDP FY2014 increase of 0.7% in Q3 (as compared to the maintained throughout 2014 continued growth of 0.6% results same period a year earlier) caused, mainly, to have its negative effect on the economic by a good harvest, in Q4 this indicator fell performance. Apart from political and Apart from that, in midterm, the economy Thus, the Russian economy did manage into the red zone making -0.2%. As of year- economic sanctions, the existing situation will be stressed by a number of internal to preserve its growth as of year-end, end, GDP grew by 0.6%. Thus, the Russian resulted in the dramatic weakening factors: with a rising impact of external shocks economy did manage to preserve its growth of economic confidence. in place A drop in consumer demand whose major phase will as the year-end results show, with a rising be in 2015, to be followed either by stagnation or Accelerating inflation had a negative impact on the stability impact of external shocks in place. moderate growth; of the current economic growth. As of 2014 year end, the inflation rate grew to its maximum of 11.4%, first registered Nevertheless, the key factor for further growth of the Russian in 2008. This was caused, primarily, by two factors: devalua- Having affected all sectors of the consumer market, the economy is the level of oil prices which experienced a dramatic tion of the national currency due to a cut in energy commodity prices growth will continue well into 2015. In Q1 2015 decline in September to December 2014. Such drop had a great prices, and also by introduction of food sanctions against the annual inflation rate was 16.9%. In H2 2015 inflation impact on the exchange rate of the Russian currency, which EU countries. factors are likely to grow less strong due to a reduced lead to significant inflation consequences. demand. In 2014 the Central Bank of Russia pursued a policy to target inflation, one of the tools of which was increase of key inter- Weak internal investment activity which, nonetheless, est rates. With sharp devaluation of the national currency may recover in 2016–2017 due to import substitution; in place, CBR had to increase the key rate to 17%, it having grown by 11.5 percentage points since the beginning of the Limited opportunities to attract external borrowings GDP Dynamics* year. Nevertheless, those measures had no due effect on prices and, consequently, high cost of funding for the real because of the drop in oil-price hikes and weakening of the sector. The Bank does not expect the environment 4.5% 4.5% 3.3% 4.3% 4.6% 3.4% 0.9% 1.3% 1.0% 0.6% national currency exchange rate; but they lead to resource to improve in 2015 but a gradual restoration 5% appreciation for the banking sector and, as a consequence, of confidence to Russia may lead to positive changes; for the real sector. Combined with absence of opportunities
4% to attract external borrowings, the cost of funds changed drastically. Pressure on the banking sector as a result of asset quality deterioration. In 2015 high risk of banking crisis 3% The Bank assumes that the current inertial trends, complicated will maintain, further stabilization of the environment geopolitical environment, oil prices at USD 50-60 per barrel will be possible in case a consistent and predictable CBR (Urals) will persist in 2015, while GDP continues to slide down. 2% policy is implemented and general economic situation is Such forecast is confirmed by GDP reduction dynamics in Q1 normalized. 2015 which, according to the Ministry of Economic Development 1% of the Russian Federation, made –2.2%.
0% H1, 2010 2010 H1, 2011 2011 H1, 2012 2012 H1, 2013 2013 H1, 2014 2014
* Half-year data are presented annualized and are compared to the same values of the previous year.
24 www.expobank.ru 25 Expobank 2014 2
ANNUAL REPORT Startegic Report Strategic Goals for 2015–2017
Strategic Goals for 2015–2017
As a result of the above trends development, the Bank expects The factors described above will inevitably lead to augmenta- 2015–2017 Strategy is a continuation The Bank is planning to concentrate on the relationships with high cost of funding to maintain in midterm, with it gradu- tion of the trend on consolidation of the banking sector which and development of the implemented corporate clients operating in the sectors most resistant ally decreasing as inflation slows down. Due to high rates on will be supported by the regulator in order to minimize DIA to economic crises. Along with classical banking products, attracted funds banks will face a reduction of interest margin. insurance payments. 2012–2014 Strategy Expobank is planning to assist its clients in increasing their businesses value through offering complex individually struc- Apart from that, costly funding together with a drop in house- Thus, to preserve capital and take a rightful place in this coun- The major task for the said period is providing our Clients with tured products (M&A’s, MBO’s), restructuring and optimization hold real earnings and reduction of consumer activity will lead try’s banking market, an ongoing search for new opportunities first class financial services and gaining stable income in any of debt burden of companies, financial consulting, etc. to gain profits with the market environment deteriorating is to reductions in retail lending. In 2015, the volume of retail market environment through the high professionalism of our required. Effort focused on private banking development enables the loans is likely to remain at the 2014 level. Corporate lending will team and financial advantages of the Bank. be influenced by a mix of such factors as contraction of produc- Bank to form a stable resource base for further development tion and low investment activity, and necessity to substitute The Bank consistently cuts down on the product-based busi- and creates a sustainable source of fee income. foreign funding. In order to preserve capital and take ness model in favour of the customer-focused model centered The Bank has expertise and competence in acquisition of stand- on building-up of long-term relationships with households and a rightful place in the Russian banking ardized retail portfolios and loan portfolios extended to small As a whole, with the economic environment deteriorating, companies. The Bank is regarded as a ‘service company’ for its and medium enterprises and formed by professional players in the Bank expects growth of the Russian banking sector to be market, an ongoing search for new corporate clients and private customers. slowed down both in lending and in attracting deposits. opportunities to gain profits with the the relevant segments of the banking market. Purchase of port- The Bank is focused on the key regions of its presence that folios planned by the Bank will enable it to form highly marginal Negative economic conditions will put strong pressure on asset market environment deteriorating enable it to successfully implement the strategic goals. loan portfolios with minimum loss. quality, which will lead to the necessity to raise sizeable provi- is required. Moscow, Novosibirsk, Saint Petersburg, Yekaterinburg, Surgut, The economic situation makes it possible for the Bank, in mid- sions. The latter will have a strong effect on the financial results Krasnoyarsk, Kemerovo, and Perm are defined as priority term, to make high-yield transactions in the financial markets. of the banking sector in 2015. regions for the Bank’s operation. The Bank is planning to convert its extensive liquidity cushion In light of the listed above, pressure on the capital of Russian into top-up margin as funds are scarce in the market. banks will increase dramatically, which will inevitably lead to a demand for additional capital to be raised either through the Focus on the complex servicing of corporate Along with organic growth, the Bank strives to increase existing shareholders, or through recruiting new investors, clients and affluent private customers the volume of its business through M&A’s with other credit or through government support. Sector low profitability will through corporate sales channels enables institutions, the synergy effect of which will enable the Bank impede recruitment of external investors while general decel- to develop at the rate exceeding the market average. A combi- eration of the real sector will reduce opportunities for Russian the Bank, without increasing general and nation of organic growth with M&A deals will enable Expobank banks of capital top-ups from the existing owners. Government administrative expenses, to efficiently to expand its geographical footprint and offer its clients yet support will be available to a limited number of market players, increase non-interest income and maintain more financial opportunities. which will lead to strengthening of big players, mainly of those the Bank’s resistance to external impacts partially owned by the government. through:
maintaining a flexible product line (development of niche products, transaction and fee services);
focus on cross-selling;
implementation of a service model targeted at the highest service quality, close integration with the investment and retail businesses.
26 www.expobank.ru 27 State Historical Museum House of the Blackheads TRADITIONS The main historical museum in Russia was officially This most beautiful building was erected in the center established in 1872 by a personal decree of Emperor of Riga in 1334, in the times of the Livonian Order, as Alexander II. The Museum’s building was constructed a gathering place for townsfolk to meet and hold feasts. To create innovations and successfully develop, in 1881, following the design of architect Vladimir Shervud. At the end of the 16th century the House was leased traditions have to be known and venerated. Analysis Its exterior, styled in conformance with the 16th century to the Brotherhood of Blackheads. This association of the previous experience ensures reliability and Russian architectural traditions, harmoniously fitted into of foreign merchants had existed in Livonia since the soundness of all new solutions and beginnings. the architectural ensemble of Red Square. At present, its mid 14th century. The name “Blackheads” is linked to the To Expobank, it means primarily a deep understanding collection boasts of almost 4.5 million exhibits telling about patron saint of the Brotherhood — the black Saint of nation-specific practices in the financial markets Russian history from the earliest times down to our days. Mauritius. of various countries. Respect for traditions makes our business universal, global and really stable. MOSCOW, RUSSIA Riga, Latvia
National Museum
Since its foundation in 1818, the National Museum in Prague has accumulated a richest collection of exhibits. Several million items are displayed in the main building and at other exhibition sites. The Museum’s main building inaugurated on 18 May 1891 is the gem of Wenceslas Square.
Prague, the Czech republic Expobank 2014 2
ANNUAL REPORT Startegic Report Treasury
Private Banking / Treasury Expobank Premier
Royal Service. We Have Common Goals with Our Clients share of liquid Issuable assets as securities of 01 January 2015 portfolio of 11.8 44% RUB BLN Funds placed services of the personal relationship manager acting as a personal banker in retail deposits Compared to early 2014, the share As of 01 January 2015, the volume of the amount to 16 RUB BLN special conditions applied to the Bank’s products of liquid assets as of 01 January 2015 issuable securities portfolio increased grew by 10 percentage points and made by 42% against the similar data of the Due to cross-sales to/from membership in the VIP Privilege Club — special servicing 44% in the Bank’s total assets previous period and made RUB 11.8 bln conditions, participation in closed events of the Bank’s its Corporate Business the Bank was partners able to attract new clients 2014 was marked by new challenges to the Both these external and internal factors set forward the effi- ciency of liquidity management as the priority area for Treasury. Private banking and development of the Premier operation are Russian banking system in view of its a strategic line of the Bank’s business. financial sustainability and stability. Throughout 2014 the Bank kept on with the strategy of main- taining liquid assets at a level exceeding 30% of the total Over 2014 the amount of the funds placed in retail deposits assets. Compared to the beginning of 2014, the share of liquid grew up to RUB 16 bln. In 2014, the Bank outpaced the market Along with the ongoing strengthening of prudential supervision assets as of 01 January 2015 grew by 10 percentage points due to the updated deposit product line, introduction of lending on the part of the regulator in 2014, external macroeconomic and made 44% in the Bank’s total assets. to VIP-clients on special terms and conditions. Due to cross- factors started to produce an adverse impact both on the finan- sales to/from its Corporate Business the Bank was able cial system of Russia as a whole and on the banking system in One of the tools of efficient liquidity management in 2014 to attract new clients. particular. remained investment of funds in debt securities of the issuers of high credit quality and included into the Lombard List of the During 2014 the volume of funds attracted from the existing cli- Due to the imposition of sector sanctions by the USA and the Bank of Russia. ents was increased substantially due to the individual approach EU countries since March 2014, external markets have been to servicing. Average amount placed by a VIP-client grew from actually closed for attracting liquidity, there has been a mass As of 01 January 2015, the volume of the issuable securities $250 thousand to $350–500 thousand, which indicates their exit of foreign investors from securities issued by the Russian portfolio increased by 42% against the similar data of the greater confidence in the Bank. Federation and Russian companies. previous period and made RUB 11.8 bln. The package of services offered by AS Expobank expanded. Our team members maintain relations with the customers not only to do business but also to socialize and attend to the The Bank has created and successfully operates interests and hobbies of each of them, organizing and holding joint events. For example, at the end of 2014 there took place a system of private banking ‘Expobank Premier’. “The Royal Pheasant Hunt”. The customers are offered: Hunting took place in the pheasantry and keeping station services provided in comfortable VIP branches (there ‘Vltava a Borek’ located in a scenic landscape of Southern are servicing sites in Moscow: Business Center ‘Malaya Bohemia adjacent the town Hluboká nad Vltavou. Dmitrovka’ Office, as well as in Novosibirsk, a key operations area) Hunting excitement, company, competing in the number of hunting trophies made this event an unforgettable one.
30 www.expobank.ru 31 Expobank 2014 2
ANNUAL REPORT Startegic Report Treasury
44% 48% 34% 34% 44% 44% Securities Portfolio Split-Up by Maturity (%) 30 Up to 90 days 15%
2.9 91–180 days 13% 2,9 20 11.8 2.9 11,8 181–365 days 24% 11.8 2.9 11.8 1 to 2 years 11.8 16% 8.2 10 8,2 2.9 8.2 2 to 3 years 9% 8.2 11.8 8.2 Over 3 years 8.2 23%
0 H1, 2012 2012 H1, 2013 2013 H1, 2014 2014
Due from other banks Marketable securities Cash and cash equivalents Liquid assets share
Despite the adverse market environment, in July 2014 Expobank Net profits successfully passed the offer as part of its liquidity manage- from securities ment framework and implementing its strategy on diversifica- transactions in 2014 Securities Portfolio Split-Up 983 tion of funding sources. RUB MLN by Issuer Rating (%) Almost all of the bonds in the amount of RUB 1,174.5 mln bought out under the offer were placed during July 2014 with from ВВВ– 34% In 2014, net profits from such a rate of return of 11.5% per annum. from ВВ– to ВВ+ 60% transactions amounted to RUB In 2014 Expobank significantly increased its income from from В– to В+ 6% 983 mln vs RUB 7.4 mln in 2013 securities business. In 2014, net profits from such transactions amounted to RUB 983 mln vs RUB 7.4 mln in 2013.
32 www.expobank.ru 33 Riga International Airport Moscow Domodedovo Airport is the largest airport in the Baltic states in passenger is the largest airport in Russia in terms of passenger and cargo traffic. It was built in the Riga region, next traffic and is among the 20 busiest air hubs in Europe. to the settlement of Skulte in 1973. By 2001, when Riga The first passenger flight from Domodedovo was made SPEED celebrated its 800th anniversary, the airport was fully on 25 March 1964. Now, 82 airlines operate their renovated. Today, regular flights are operated from Riga flights from the airport to 247 destinations worldwide. Airport to 31 countries. In 2011, World Airport Awards recognized Domodedovo Time is money. Today, speed of banking transactions as the best airport in the Eastern Europe. has increased to such an extent that some do not even notice it. But we, as market professionals, know it for sure that the limit is not achieved yet. We improve our technologies and gain momentum for our clients Mārupe Municipality, Latvia Domodedovo, Russia to be faster, to make it earlier, to be ahead of their competitors, and to make it first.
Václav Havel Airport Prague
The airport, formerly Prague Rusynĕ International Airport, began its operations on 5 April 1937. In the same year the technical conception of the airport received Diploma and Gold Medal of the World Exposition in Paris. Now, the airport processes regular flights to 132 destinations. Annual passenger traffic here exceeds 10 million people. Since 2012, the airport in Prague has been named after Václav Havel.
Prague, the Czech Republic Expobank 2014 2
ANNUAL REPORT Startegic Report Corporate Banking
Corporate Banking
Throughout 2014 the Bank continued to develop the corporate Assumptions arose to expand the list of strategic Structure of Corporate Credit Portfolio, transaction model focused on generation of fee income from industries and add to it new priority sectors: by industry (%) implementation of complex structured transactions for medium Residential and large businesses. Specific features of this model made it food processing industry / agricultural processing construction possible for the Bank to preserve a conservative approach in industry 27.6% risk assessment. Commercial The Bank also kept on with its consistent work on enhancement retail trade property 19.5% of its positions in such strategic industries as development Production 16.6% of residential and income generating property. oil and gas industry Wholesale trade 9.4% To develop its activities in the Eastern Europe and implement import substitution programs, the Bank built up financial rela- Finance 9.1% tionships with one of the biggest players in the machine-tool A strategic resolution has been taken that Oil and gas industry, joint Czech and Russian Company ‘MTE Kovosvit MAS’. in 2015 one of the goals for the Bank will be industry 7.3% Implementation of this project enabled the Bank together with colleagues from Expobank CZ to provide the client with the full to attract large corporate clients: holdings Services 3.5% range of banking services — from support of financial trans- and industry leaders including those with Other 7.0% actions in the Czech Republic to issue of bank guarantees and revenues exceeding RUB 15 bln a year. funding to secure contract obligations in Russia. Due to the corporate team’s expansion and appearance in Q4 2014 of a new department headed by Mr. A.V. Fedotkin, corpo- rate business gained additional momentum by the year end. The Bank has two key 1) A flexible approach 2) Due to high capital competitive advantages in and an opportunity to get adequacy and a liquidity active operations: approvals for deals, which cushion as compared to the enables the Bank to timely deficit experienced by the approve and implement sector in general the Bank non-standard projects. is capable of funding quality assets with the margin exceeding the market average.
The Bank’s strategy in Corporate Banking is focused on the development of long-term relationships with the clients that have an experience of cooperation throughout crises times and whose businesses are resistant to uncertainties and stresses, and with the shareholders that have an impeccable reputation and are ready to be materially liable for their business.
36 www.expobank.ru 37 Expobank 2014 2
ANNUAL REPORT Startegic Report Regional Policy
M&A Regional Policy
In September 2014 Expobank successfully As of 31 December 2015, the Bank is represented in: Assets closed the deal on acquisition of 100% of Expobank CZ 750 shares in Czech LBBW Bank CZ a.s. a.s. of EUR MLN from Landesbank Baden-Württemberg. FEDERAL CITIES In 2014 rebranding of the acquired entity Assets of Expobank CZ a.s. make was completed, with the new name 5 DISTRICTS 8 (4 branches and 13 offices): EUR 750 mln, capital — to EUR 94 mln, of Expobank CZ a.s. Expobank LLC owns its credit portfolio — EUR 510 mln. 19.8% of the voting shares in Expobank Central FD Moscow Expobank LLC owns 19.8% CZ a.s. Siberian FD Saint Petersburg of the voting shares in this bank. Northwestern FD Novosibirsk Volga FD Kemerovo Ural FD Krasnoyarsk Perm In September 2014 Expobank successfully closed the deal Expobank CZ a.s. is characterized by high capital adequacy Yekaterinburg on acquisition of 100% shares in Czech LBBW Bank CZ a.s. (CAR 24.8%), good loan book quality (share of impaired loans In 2014, the Bank’s main task with regard Surgut from Landesbank Baden-Württemberg. In 2014 rebranding in the portfolio is 3%), and also by a well-diversified asset to its implementation of the regional network of the acquired entity was completed, with the name changed structure and excess liquidity (share of liquid assets is 28%). to Expobank CZ a.s. Expobank LLC owns 19.8% of the voting Assets of Expobank CZ a.s. are equal to EUR 750 mln, capital — development strategy was expansion of the shares in Expobank CZ a.s. to EUR 94 mln, its credit portfolio — EUR 510 mln. territories where Expobank operates and en- Expobank CZ a.s. is focused on lending to medium corporate Development through M&A’s is an important part of the Bank’s hancement of the branch network efficiency. clients, offering banking services to German companies in the strategy. Expobank’s team is excellent at implementing such Czech Republic, export financing and servicing affluent private projects and monitors the market both in Russia and in other customers. As a result of this acquisition Expobank gained over regions; while the Bank’s strong financial position and high prof- The Bank successfully develops within its strategic business Universal Bank branches offer to private and corporate custom- 30 thousand active clients in Europe, an opportunity to ser- itability ensure its readiness to such transactions any time. model and creates optimal conditions for its clients in response ers and clients a competitive product line that meets market vice export and import transactions between Russia and the to the market challenges. needs in all regions where the Bank is present. Czech Republic, and also a competence in working with German For example, there are ‘Expobank Premier’ format offices companies. in Moscow and Novosibirsk focused on VIP-clients who can avail of premium services.
2014 Assets Liabilities Central FD (without centralized business) 81% 65% Siberian FD 17% 24% Northwestern FD 1% 2% Ural FD 1% 7% Volga FD 0% 2%
38 www.expobank.ru 39 Expobank 2014 3
ANNUAL REPORT Corporate Governance Accountability and Efficiency
Corporate Governance
Accountability and Efficiency
One of the underlying principles of building Shareholders of the Bank: Directors: The Audit Committee is a consultative and an efficient corporate governance system is advisory body of the Board of Directors providing distinct allocation of competences among Igor Kim 66.64 % Igor Kim for presentation to the Board of Directors of the Chairman of the Board of Directors objective information on the following matters: corporate governance bodies, with due German Tsoy 17.63% control exercised. Alexey Andreev completeness and reliability of the Bank’s financial OJSC ‘AUTOBANN’ RBC 8.76% Member of the Board of Directors statements;
Kirill Nifontov 2.65% John McNaughton qualifications and independence of the external auditor, The underlying principles and procedures for the Bank cor- Member of the Board of Directors quality of its services; porate governance are stipulated by the Charter and Code MORELAM HOLDINGS LIMITED 1.82% of Corporate Conduct of the Bank. The current corporate Kirill Nifontov reliability and efficiency of the internal control system governance system of the Bank includes various elements Yuri Koropachinsky 1.14% Member of the Board of Directors of the Bank; and mechanisms used to have shareholders’ rights exercised, to perform efficient internal control, and carry out interaction Oleg Kirillov 1.14% German Tsoy compliance with laws and regulations. among the Bank’s managers, shareholders, Board of Directors Member of the Board of Directors and other stakeholders. Dmitry Ganushkin 0.02% Frank Wilhelm Schauff Management Committee: The corporate governance system Member of the Board of Directors Alexander Proshin 0.2% Kirill Nifontov of the Bank includes: Chairman of the Management Committee Committees of the Board of Directors Board of Directors Ernst Bekker General Shareholders’ Meeting; To ensure efficient performance of the tasks set for the Bank, Deputy Chairman of the Management Committee the Board of Directors has, by its resolution, set up Audit Board of Directors; The Board of Directors of the Bank Committee of the Board of Directors. Dmitry Ganushkin consists of 6 members. Each member Deputy Chairman of the Management Committee Collective executive body — of the Board of Directors of the Bank has Audit Committee Management Committee; experience, knowledge, qualification and Oleg Novolodsky Frank Wilhelm Schauff — Chairman of the Committee; Deputy Chairman of the Management Committee enjoys impeccable reputation required Sole executive body — for performance of duties of a Board Chairman of the Management Committee. John McNaughton Olga Pugacheva of Directors member and for organization Deputy Chairman of the Management Committee of efficient operations of the whole Board of Directors to the benefit of the Bank and Alexey Sannikov its shareholders. Deputy Chairman of the Management Committee Alexey Fedotkin Deputy Chairman of the Management Committee
40 www.expobank.ru 41 Expobank 2014 3
ANNUAL REPORT Corporate Governance Risk Management
Risk Management
Risk acceptance is the essence of the The main risks accepted by the Bank when Credit Risk Analysis Acquired financial business, and exposure to risk performing transactions are credit risk, claims The major part of the credit portfolio of the Bank has been is a key condition of working in this area. market risk, liquidity risk, operational risk, to individuals 12.9 formed as the result of corporate lending transactions and The Bank’s Executive Team considers an legal risk and reputational risk. of RUB BLN purchase of retail credit portfolios. efficient risk management system a basis In 2014, the volume of the acquired claims to individuals of the Bank financial stability and key factor In 2014, the volume of the acquired increased from RUB 12.1 to 12.9 bln. Throughout the report- of its competitiveness determining the level claims to individuals increased from ing period the Bank has maintained the share of NPL’s in the of its profitability and shareholder value. RUB 12.1 to 12.9 bln. Loss on the purchased portfolios at zero level due to application of risk portfolio is equal to zero mitigation instruments provided for in the course of structuring The main objective of risk management is portfolio purchase transactions. maximization of the long-term shareholder High assets quality is of top priority for the Bank. Thus lending value of the Bank. Main Operating results for 2014 in a volatile economic environment is done with the use of con- servative criteria. The corporate credit portfolio of the Bank In 2014, to bring the risks management system shrank by 22.5% over the reporting period (from RUB 15.0 bln to RUB 11.6 bln). Despite reductions in the credit portfolio the in line with the statutory instruments of the Credit Risk Credit Policy of the Bank volume of impaired corporate loans in it, as of 2014 year-end, Bank of Russia, Risks Management Strategy was decreased by RUB 306 mln, or by 32,8% (from 6.2% of the Credit risk means the probability of incurring by the Bank Credit policy of the Bank is aimed at creating approved in the Bank, changes were made to its corporate credit book to 5.4%). of financial losses resulting from the failure to perform, late a high quality credit portfolio and keeping bad organizational structure: Risks Management performance or incomplete performance by counterparties debt at the level close to zero. The following key of their obligations to the Bank. Service was set up, and its Head was appointed. principles help to achieve this objective: As part of ongoing activities on enhancement The Bank accepts credit risk in connection with lending transac- of risk management processes the following tions, as well as with other transactions characterized by credit The Bank extends credits only to those clients whose risk. business it understands clearly and who have stable measures were implemented during the initial sources for credit repayment. reporting period: The Bank manages its credit risk individually in relation to each client group (corporate clients, small and medium businesses, testing of ‘Action Plan Ensuring Business Continuity The Bank does not lend to clients with excessive debt individuals, financial institutions). and/or Business Recovery in Expobank LLC in Case load and high risk exposure. The upper level limits (risk appetite of the Bank) are set of Abnormal Situations and Emergencies’ and its according to the risk management strategy and credit pol- subsequent update and fine-tuning; When taking a decision on the credit issue the Bank establishes icies approved by the Board of Directors and Management personal liability for its repayment. Committee. Limits for individual counterparties and groups validation of the applied risk level assessment models of related counterparties, concentration limits, etc. are set The Bank has approved credit policies on each type of lend- (rating models, VaR models); depending on the amount and type of the limit by resolutions ing: corporate business, small and medium enterprises, retail of the collective bodies (Board of Directors, Management lending, financial markets. These policies define the priority updating of the risk management methodology; Committee, credit committees) or authorized officials of the client groups, product line, requirements to the lending process organization, and the total of the restrictions applied and credit Bank. testing of the Bank employees’ skills related to the risk risk limits. Statements on the risk level of the credit portfolio are regularly management methodology. prepared by employees of Risk Management and are promptly communicated to the business units and Management of the Bank.
42 www.expobank.ru 43 Expobank 2014 3
ANNUAL REPORT Corporate Governance Risk Management
Market Risk Liquidity Risk Operational Risk The Bank uses the following means of identification and assessment Market risk means the probability of incurring by the Bank Liquidity risk means the probability of incurring by the Bank Operational risk means a probability of incurring of its operational risks: of financial losses due to changes in market prices for finan- of financial losses due to its inability to secure timely perfor- by the Bank of direct and indirect financial losses cial instruments, including exchange rates and interest rates. mance of its financial obligations in full and with minimum due to: identification of operational risks in the process Market risk comprises pricing, currency and interest risks. expenses. of development/modification of the Bank’s products Market risks arises on open positions related to equity, debt, The liquidity risk arises from mismatch of asset and liability any inconsistency between the internal business and processes; currency and interest financial instruments exposed to influence maturities. processes and nature and scale of the Bank activity; of general and specific changes in the market environment. analysis of data on the losses incurred by the Bank The Bank manages its liquidity risk violation by Bank employees or any other persons of the as the result of the operational risk occurrence; The Bank manages its market risk on the centralized basis: internal regulations of the Bank and laws of the Russian on the centralized basis: Federation (due to the lack of competence, unintentional independent assessment of operational risks strategic management is effected by the Assets and or intentional actions or omissions); by the Bank units. risk identification, assessment and control are effected Liabilities Committee; by employees of Risk Management; disproportion (inadequacy) of functional capabilities The Bank applies the following methods to reduce operational management is effected by Treasury. (characteristics) of the information, technological and decisions in market risk management, including setting other systems applied by the Bank or their failure its exposure to operational risks: risk limits, are taken by the Assets and Liabilities (malfunction); Committee; The Bank uses the following instruments regulation, standardization and improvement of the Bank business processes; for liquidity risk management: impact of external factors; management of open positions in financial instruments automation of bank technologies and information exposed to market risk is effected by Treasury. maintenance of the assets and liabilities structure influence of the legal risk factors. balanced in terms of their maturity; protection; The Bank opens positions in the financial markets to develop The process of the Bank’s operating risk diversification of the financing sources, focus on the organization of the internal control system; its client business and to manage liquidity. The Bank does not management includes the following stages: open own speculative positions in the financial markets without stable client liabilities; consent of the Board of Directors. insurance of losses caused by operational risks risk identification; creation of the liquidity cushion consisting of highly occurrence. liquid financial instruments with low credit risk; risk assessment; The Bank engages employees of all units of the Bank to manage stress testing of the liquidity risk and development its operational risk; operational risk management is coordinated of action plans in case of the liquidity crisis occurrence; risk monitoring; by Risk Management.
forecasting of receipts and payments, keeping reduction of the risk exposure. a payment position.
44 www.expobank.ru 45 TIMELINESS
Not to set oneself above everyone, but to be useful and loyal is a genuine goal worthy of any effort. To do good, become part of people’s life, that of a city and country — these are the values Expobank has always sought to share. In order to remain up to the mark, every day we have to offer to the business and private customers what they expect from a modern dynamic bank: cutting edge technologies, up-to-date tariffs, prompt service. To work in tune with the pace of today’s world, never growing complacent, and to move ahead — these are the tasks crucial to us at all times.
Riga Radio and TV Tower Ostankino Tower Žižkov Television Tower
Being 368.5 m tall, it is the tallest TV tower in the Standing 540 meters tall, it is the fourth tallest Springing up above the ground 216 meters, Žižkov European Union. Its construction and assembly television tower in the world and the tallest free Tower is a member of the World Federation of Great continued from 1979 to 1986. The tower is built on standing structure in Europe. It was under construction Towers. It was built between 1985 and 1992. Apart Zaķusala island in the middle of the Daugava river. There between 1960 and 1967. Ostankino Tower is one from radio broadcasting equipment, the tower houses is an observation platform at 99 meters from which of the main architectural symbols of Moscow. Today, a meteorological station, a restaurant, a café and most of the city and surroundings and the Gulf of Riga Ostankino’s broadcast TV and radio transmitters cover three viewing platforms. In 2000, in commemoration can be seen in good weather. a territory inhabited by over 15 million people. of Prague being announced the European Capital of Culture, sculpturer David Černý decorated the tower with cast-iron figures of crawling babies. Riga, Latvia Moscow, Russia Prague, the Czech Republic Expobank 2014 3
ANNUAL REPORT Corporate Governance Information Openness and Transparency
Information Openness Social Policy and Transparency and HR Management
Reputation of the Bank Information Openness people were employed Attrition in 2014 is the key intangible asset Committed to the principles of information transparency, in the Bank as rate of which is the linchpin of trust the Bank is always open to active dialogue with mass media. 482 of 31 December 2014 5% Throughout the year we promptly provided journalists with of our Clients and Partners. the most updated information about the Bank’s activities and The key factors to the Bank’s success The Bank is characterized by stability answered questions posed to us. Speakers of the Bank covered in social policy are employees’ high of its staff composition and low attri- Communication policy of the Bank is part the topics related to the banking market, shared their expert and analytical commentary, did their best in explaining to the professional skills, opportunities for tion rate and parcel of doing modern and successful audiences of newspapers, magazines, radio and TV programs all revealing their talents and capabilities business. This activity is aimed at creating subtleties and specific features of the banking services market, a positive image of the Bank in the eyes and also the challenging environment in the financial markets and banking sector. of society. We are sure that — especially The Management of the Bank sticks to the principle that Employees’ high professional skills, opportunities for revealing in contemporary environment — this key the Bank’s success depends entirely on the people work- their talents and capabilities, an ability to use them for the intangible asset is the linchpin of trust ing for it. Our employees are the ‘human capital’ due benefit of the bank and the employees themselves — these to which, to a great extent, efficiency and shareholder value are the key factors to the Bank’s success in social policy and of our clients and partners. of Expobank grow. It is the Bank team members who create human resources management. The Bank is characterized by additional shareholder value for the Bank’s business by their stability of its staff composition while the attrition rate is low efficient and creative work. (5%). Headcount as of 31 December 2014 was 482 people.
Headcount Dynamics in 2012–2014 (people)
206 358 151 276 168 306 154 328 400
350
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0 2011 2012 2013 2014
Regional network Parent bank
48 www.expobank.ru 49 Expobank 2014 3
ANNUAL REPORT Corporate Governance Information Openness and Transparency
Headcount Structure in 2014 (people) Vacancy Closure Structure (%)
36 55 49 30 39 58 39 49 Line positions 9% 62 191 82 104 62 176 66 196 Key positions 60% 49 171 65 97 31 108 26 106 Students 31% 450
400
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0 Male Female Male Female Male Female Male Female In a accordance with this approach, during 2014 the Bank 2011 2012 2013 2014 recruited high-skilled team members. students had a professional 45 y.o. and older 30–45 y.o. Under 30 y.o. Expobank has been developing an active cooperation with Russian institutions of higher learning that train professionals placement in Expobank in 2014 in banking and finance. The major goal of cooperation with 70 The Bank has introduced a flat organizational structure that To create a team of high profile and professional universities and colleges is to form with the potential candi- enables it to resolve all operational matters of daily activities at fellow-thinkers ready to solve any challenging dates a concept of the Bank as of one of the best employers The number of students who had the horizontal level. tasks, able to take advantage of the market and of a company that is ready to engage graduates and build a professional placement in 2014 (as environment, the Bank implements a complex up long-term partner relations with them. The number of stu- compared to 2013) increased by 41.4% Personnel Selection and Adaptation approach to recruitment of skilled employees: dents who had a professional placement in 2014 (as compared to 2013) increased by 41.4% and made 70 people, out of which Active development of the Bank, growth of volumes and diver- planning of staff selection, with strategic goals and 20 were later employed by Expobank LLC. sification of businesses require a regular influx of highly-skilled operational tasks taken into account; professionals to the Company who bring in new experience, state-of-the art knowledge, advanced technologies. Banking business, principally, is an intellectual business. That is why it recruitment of candidates meeting the requirements is the development of the company’s intellect that comes first of the Bank and position; today, while the value of any company is its people. creating and maintaining an image of an attractive employer bank;
organization of professional placements for students of field-specific institutions of higher learning.
50 www.expobank.ru 51 Expobank 2014 3
ANNUAL REPORT Corporate Governance Information Openness and Transparency
The motivation system in the Bank employees of the is transparent and easily understandable Bank were awarded to each employee. It stipulates clear and 58 in 2014 transparent principles for setting target amounts of bonuses and calculation of their As part of the corporate competition actual values based on KPI’s. system implementation process, at the end of 2014, 58 most efficient employees were awarded for their high performance
Remuneration Apart from material incentives, the Bank consistently develops a system of non-material incentives for individual and team and Employee Incentives performance results.
Today the Bank applies a competitive remuneration system con- As part of the corporate competition system implementation Training and Development The Bank is focused on long-term partner sisting of the fixed and variable components. The amount of the process, at the end of 2014, 58 most efficient employees were relationships between the Bank and its fixed component is determined on the basis of the labor market awarded for their high performance. Of them 12 employees and The bank implements programs on the employees’ develop- team. Preparation of the managerial ment, their advanced training, expansion of their professional analysis for the region where the Bank operates whose results 3 subdivisions with the highest results received awards on the back-up out of the employees is based on are used for regular employee-by-employee review of their stage during the ceremony dedicated to the main corporate horizons on the regular basis. Development of intellectual envi- income levels. The variable component is represented by the event of the year. ronment is among top priorities in the Bank’s strategy. a two-level model of formation of a talent incentive system aimed at enhancement of performance results, As part of the implemented complex program on personnel pipeline, which contributes to the focused on achievement of both individual and collective results, training and development for 2014, 178 employees (40%) improvement of interaction within the team, strengthening of material motivation of the Bank employees. successfully completed their training, with over 100 various to professional development and personal The variable component depends on the performance efficiency courses, seminars, trainings organized for the team members fulfillment of promising team members of each employee, the level of accepted responsibility, the level contributing to the process. Also, to meet the regulator’s of risks the Bank is exposed to as the result of their activities. requirements, skills enhancement training was organized for and promotes innovation. 20 employees of the Bank. Following the strategic priorities implementation plan, ‘English Language School’ was opened for our employees to improve their English skills. In 2014 a system of distance learning began its operations in the Bank. This made possible to conduct wide-scale dis- tance learning and staff assessment. Since the launch of DLS 348 people have already had their skills assessed.
52 www.expobank.ru 53 Expobank 2014 3
ANNUAL REPORT Corporate Governance Information Openness and Transparency
Labor Safety Social Policy
Expobank LLC takes a responsible approach in carrying out its A number of measures have been introduced in the Bank aimed duties on labor safety, considering this process not as employ- at health promotion and ensuring proper rest and recreation er’s additional expenses but as investment in human capital. of the employees, at support of parenthood and family, at pro- Undoubtedly, value of human factor, of human resources is tection against the risks of unfavorable events occurrence. an important element of modern business. That is why labor safety and health protection of its team members is one of top The Bank does not only take care of its employees priorities for the Bank in the organization of work processes. but also gives support to their families providing Activities of the Bank in labor safety are comprised of special social benefits and guarantees. In 2014, over assessments of working conditions, provision of individual employee categories with personal protective clothing and RUB 2,300,000 of the following social benefits equipment and overalls, personnel health and safety trainings were paid to the Bank employees: and trainings on safe working procedures, organization of med- ical examinations for employees at hiring stage and further Birth of a child in an employee’s family throughout their work activities. First official marriage
In 2014 Expobank completed the pro Employee’s coming of retirement age ject on special assessment of working conditions. During this assessment Death of an employee’s close relative hazardous working conditions at work Support for the employees parenting a disabled child places were not identified. Corporate Culture In 2014 the Bank continued developing channels of interac- Challenging life circumstances of an employee tion with its team members. The key information channels for One of the important tasks of HR employees were email newsletters containing the news of the Bank and banking sector, information about events held in the Besides, in addition to the existing elements of the intracorpor- management policies in 2014 was ate employee social protection in 2014, those employees who Bank, about achievements of our team members and successes had worked in the Bank for at least 1 year had an opportunity enhancement and promotion of corporate of our football team. 2,300,000 to choose a specific social benefit: either a private health culture. Corporate culture manifests itself In 2014, the Bank launched its corporate newsletter ‘Express’, insurance policy or a compensation for a fitness center season in a positive image of the Bank within the whose every issue contains both businesses’ news, official pass. information and articles and notes on various creative pro- In 2014, over RUB 2,300,000 of various team, in the high level of employee loyalty, in the unified employees and in the strong jects, about the life of the Bank team members outside office social benefits were paid to the Bank and other interesting facts. employees team spirit.
сотрудников Банка были отмечены в 2014 году 54 www.expobank.ru 55 Expobank 2014 3
ANNUAL REPORT Corporate Governance Information Openness and Transparency
To assess the level of employee loyalty and satisfaction, Charity the Bank regularly (every six months) holds employee opinion surveys via its intranet portal to obtain feedback from its team Expobank, as a socially responsible company, has a proac- members. Survey results prove that employee loyalty and sat- tive attitude and takes part in the development and support isfaction are quite high. This signifies that all events organized of charity programs. It is this way that we can contribute and held by the employer to improve employee loyalty are to and have a positive impact on the resolution of the key social efficient and yield planned results. issues of our society.
Corporate events, as a common cause, bring In 2014 Charity Committee was set up in people together. They provide a unique the Bank. opportunity to meet colleagues again,
to see them in a casual environment. That Two major lines in charity work of the Bank in 2014 were: is why organization of corporate festivals, football tournaments and creativity Assistance to the children’s home in the settlement contests for Expobank employees has of Baryshevo (Novosibirsk region) grown into a good tradition. Support to the children’s football team ‘Metallist’ in the town of Korolev (Moscow region). In 2014 Expobank celebrated its 20th anniversary. The jubilee festive events were held in a sports manner, in the open air, and In 2014, Expobank renovated the gymnasium of the children’s included team events and creativity competitions. home in Baryshevo which earlier could not be used because Undoubtedly, the most important corporate event for the Bank of exceptionally neglected condition. team members in 2014 was a jointly organized New Year Party In 2014, Expobank gave new training uniforms and backpacks in Riga attended by employees of Expobank and its partner to young footballers from Korolev. banks from Latvia and the Czech Republic.
Charity aid of Expobank is targeted and socially focused. The principles of our Tasks for 2015 activities are tangible results, propaganda and promotion of healthy lifestyles. The Bank Formation of favorable business environment, incentives to enhance performance, investment welcomes readiness of its team members in people — these matters have always been to use their personal time and their skills of primary importance for the Bank. For 2015, for participation in the charity events improvements in adaption processes for on a voluntary basis. newcomers are planned, as well as enhancement of corporate culture in the Bank, to implement which the following tasks are set:
Internal communication rules to be formulated;
Code of Corporate Conduct to be introduced;
Effort on cascading corporate values through line managers to be intensified;
Corporate traditions within subdivisions to be developed.
56 www.expobank.ru 57 Karlštejn Castle Turaida Castle
The castle was founded in 1348 by Charles IV, Holy Turaida Cstle was founded in 1214 and for five centuries Roman Emperor-elect and King of Bohemia, as his sum- it had been a residence of Riga bishops and an estate mer residence and a place for safekeeping the Imperial of the Baltic nobility. After the fire of 1776 the castle grew PREMIUM FEEL Regalia. The castle was constructed following the design dilapidated but its romantic ruins still attracted travelers of Matthias of Arras as a gothic fortress but in the 16th for quite a long time. Reconstruction of the monument century the royal apartments were renovated in the began only in 1953. At present, the castle is open to the Modern banking is affordable by nature: an ideal bank Renaissance style. The castle was erected on the slopes public but archeological studies and restoration works should make it comfortable for each client including the of a 72-meter limestone cliff above the Berounka river. still continue. most demanding ones, because an ideal bank should think of the needs of everyone. Expobank creates prod- 28 km from Prague, ucts affordable to all and at the same time develops the Czech Republic Sigulda, Latvia premium banking programs. Expoabnk Premier means premium products and services and also a unique privileges program for clients. Royal service remains in demand at all times.
Kolomenskoye Palace
A magnificent wooden palace with emerald-green domes and turrets was constructed in the 17th century at the order of the Tsar Alexey Mikhailovich. The glorious interior décor of the country palace unfailingly was admired by foreign guests. But in the second half of the 18th century the wooden structure fell into disrepair and was de- molished. In 2010 the Kolomenskoye Palace was rebuilt according to the preserved model.
Moscow, Russia Expobank 2014 4 § ANNUAL REPORT Financial Statements Independent Auditors’ Report
Financial Statements Independent Auditors’ Report
Ernst & Young LLC Tel: +7 (495) 705 9700, +7 (495) 755 9700 Sadovnicheskaya Nab., 77, bld. 1 Fax: +7 (495) 755 9701 Moscow, 115035, Russia www.ey.com/ru
To the Shareholders and Board Auditors’ responsibility Opinion About the audited entity of Directors of Expobank LLC Our responsibility is to express an opinion on these financial In our opinion, the financial statements present fairly, in all Name: Expobank LLC statements based on our audit. material respects, the financial position of the Bank as at An entry to Unified State Register of Legal Entities was made Report on the financial statements 31 December 2014, and its financial performance and its cash We have conducted our audit in accordance with the Federal on 5 November 2002, with Principal flows for the year then ended in accordance with International We have audited the accompanying financial statements Standards on Auditing effective in the Russian Federation and Financial Reporting Standards. State Registration Number 1027739504760 assigned. of Expobank LLC (the Bank), which comprise the statement International Standards on Auditing. These standards require of financial position as at 31 December 2014, and the state- that we comply with ethical requirements and plan and perform Located at: 29 Kalanchevskaya Street, bldg 2, Moscow, ment of comprehensive income, statement of changes in equity the audit to obtain reasonable assurance about whether the Russia 107078 and cash flow statement for the year then ended, and a sum- financial statements are free from material misstatement. mary of significant accounting policies and other explanatory An audit involves performing procedures to obtain audit About the auditor information. evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s Name: Ernst and Young LLC judgment, including the assessment of the risks of material An entry to Unified State Register of Legal Entities was made misstatement of the financial statements, whether due to fraud on 5 December 2002, with Principal Management’s responsibility A.V. Sorokin Partner or error. In making those risk assessments, the auditor con- Ernst and Young LLC for the financial statements siders internal control relevant to the entity’s preparation and State Registration Number 1027739707203 assigned. fair presentation of the financial statements in order to design Located at: 77 Sadovnicheskaya Embankment, bldg 1, The Bank’s management is responsible for the preparation 29 April 2014 audit procedures that are appropriate in the circumstances, but Moscow, Russia 115035 and fair presentation of these financial statements in accord- not for the purpose of expressing an opinion on the effective- Ernst and Young LLC is a Member of Self-Regulated Auditors’ ance with International Financial Reporting Standards, and for ness of the entity’s internal control. An audit also includes Organization Nonprofit Partnership ‘Auditors Chamber such internal control as management determines is necessary evaluating the appropriateness of accounting policies used and of Russia’ (SRO NP ACR). to enable the preparation of financial statements that are free the reasonableness of accounting estimates made by the man- from material misstatement, whether due to fraud or error. agement, as well as evaluating the overall presentation of the Ernst and Young LLC is included in the check copy financial statements. of the Auditors and Audit Organizations We believe that the audit evidence we have obtained is suffi- Register under the entry main registration number cient and appropriate to provide a basis for our audit opinion. 10201017420.
A member firm of Ernst & Young Global Limited.
60 www.expobank.ru 61 Expobank 2014 4 § ANNUAL REPORT Financial Statements Statement of Financial Position
Statement of Financial Position
31 December 31 December 31 December 31 December (in thousands of Russian rubles) Notes (in thousands of Russian rubles) Notes 2014 2013 2014 2013 Assets Liabilities Cash and cash equivalents 7 8,173,843 6,808,070 Amounts due to other banks 16 11,780,109 11,102,390 Obligatory reserve with the CBR 320,511 248,140 Amounts due to customers 17 31,259,071 26,135,998 Trading securities, including: 8 6,993,522 8,065,424 Debt securities issued 19 1,601,904 2,290,773 — non-pledged trading securities 4,702,545 3,107,958 Deferred tax liabilities 25 19,172 — — pledged trading securities sold under direct repurchase agreements 2,290,977 4,957,466 Other liabilities 18 333,247 306,744 Amounts due from other banks 9 2,884,343 1,085,545 Total liabilities 44,993,503 39,835,905 Loans to customers 10 26,472,193 27,803,096
Finance lease receivables 11 400,932 1,443,367 Equity Investment securities available for sale, including: 12 1,070,779 288,865 Share capital 20 10,413,412 10,413,412 — non-pledged available-for-sale securities 1,070,779 106,958 Share premium 548,256 548,256 — pledged available-for-sale securities sold under direct repurchase Accumulated loss (1,649,137) (3,204,088) — 181,907 agreements Dividends paid 20 (2,950,000) — Investment securities held to maturity, including: 12 3,764,762 — Unrealized gains on revaluation of available-for-sale financial assets 117,805 — — non-pledged held-to-maturity securities 326,834 — Revaluation reserve for property and equipment 454,299 424,490 — pledged held-to-maturity securities sold under direct repurchase 3,437,928 — agreements Total equity 6,934,635 8,182,070 Prepayment for current income tax liabilities 2,435 20,482 Total liabilities and equity 51,928,138 48,017,975 Deferred tax assets 25 — 419,195 Intangible assets 14 40,573 81,584 Signed on behalf of the Management Committee on 29 April 2015 Property and equipment 13 1,618,220 1,638,582 Other assets 15 186,025 115,625 Total assets 51,928,138 48,017,975
K.V. Nifontov G.M. Ulanova Chairman of the Management Committee Chief Accountant
62 www.expobank.ru 63 Expobank 2014 4 § ANNUAL REPORT Financial Statements Statement of Comprehensive Income
Statement of Comprehensive Income
(in thousands of Russian rubles) Notes 2014 2013 (in thousands of Russian rubles) Notes 2014 2013 Interest income 21 5,183,600 4,130,556* Profit before tax 2,039,482 1,480,980 Interest expense 21 (2,539,681) (1,973,219)* (Income tax) / income tax benefit 25 (435,044) (364,705) Net interest income 2,643,919 2,157,337 Net profit after tax 1,604,438 1,116,275 Allowance for impairment of loans to customers and finance lease receivables 10, 11 (66,871) (633,059) Loss on discontinued operations, net of income tax 33 (49,487) — Net interest income after allowance for loan impairment 2,577,048 1,524,278 Profit for the year 1,554,951 1,116,275 Fee and commission income 22 385,240 614,449 Other comprehensive (loss)/income: Fee and commission expense 22 (84,056) (159,040) Other comprehensive income to be reclassified to profit or loss in subsequent periods: Losses net of gains from trading securities (319,402) (289) Unrealized gains on investment securities available for sale, net of tax 117,805 1,039 Losses net of gains from derivative financial instruments (61,301) (782) Other comprehensive income not to be reclassified to profit or loss in
Gains less losses from foreign currencies 734,033 15,943 subsequent periods: (Losses net of gains) / gains less losses from foreign currency translation 33 (1,423,275) 228,922 Revaluation of property and equipment 13 37,261 118,459 Losses on sale of loans and advances to customers and other banks 10, 11 — (22,204) Income tax recognized directly in other comprehensive income 25 (7,452) (23,692) Gains less losses on sale of investment securities available for sale 33 1,302,886 7,647 Other comprehensive income for the year 147,614 95,806 Other operating income 23 159,591 1,255,523 Total comprehensive income for the year 1,702,565 1,212,081 Other impairment and provisions 15, 18 (39,613) (61,920) Administrative and other operating expenses 24 (1,510,522) (1,921,547) Excess of acquirees' net assets over cost of investments 33 874,824 — Disposal of subsidiaries 33 (555,971) —
64 www.expobank.ru 65 Expobank 2014 4 § ANNUAL REPORT Financial Statements Statement of Cash Flows
Statement of Changes in Equity Statement of Cash Flows
(in thousands of Russian rubles) Notes 2014 2013
Notes Cash flows from operating activities Interest received 5,248,345 4,080,595 of the Bank (in thousands equity Total of Russian Share capital Share premium Interest paid (2,594,084) (2,239,641)
rubles) Accumulated loss Equity attributable Unrealized gains on sale financial assets Fees and commissions received 385,240 798,938 to owners of the Bank Revaluation reserve for
property and equipment Fees and commissions paid (84,056) (159,040) Non-controlling interests D ividends to shareholders revaluation of available-for- Losses from trading securities (319,402) (289) Gains from dealing in foreign currencies 734,033 15,943 Balance 10,319,835 407,623 (1,039) 329,723(4,320,363) — 6,735,779 234,210 6,969,989 at 1 January 2013 Proceeds from sale of loans to customers and finance lease receivables 55,101 887,631 Other operating income received 96,500 1,268,314 Profit for the year — — — — 1,116,275 — 1,116,275 — 1,116,275 Administrative and other operating expenses paid (1,417,406) (1,635,523) Other comprehen- Income tax paid (15,533) (21,221) sive income for 1,039 94,767 — — 95,806 — 95,806 the year Cash flows from operating activities before changes 2,088,738 2,995,707 in operating assets and liabilities Total Net (increase)/decrease in mandatory cash balances with central banks (72,371) 49,474 comprehensive in- — — 1,039 94,767 1,116,275 — 1,212,081 — 1,212,081 come for the year Net decrease/(increase) in trading securities 1,099,346 (2,809,589)
Merger Net decrease/(increase) in amounts due from other banks 3,397,280 (199,374) 20 93,577 140,633 — — — — 234,210 (234,210) — of a subsidiary Net decrease/(increase) in loans and advances to customers 3,145,409 (13,934,205)
Balance at 31 Decem- Net (increase)/decrease in other financial and non-financial assets (18,262) 366,888 10,413,412 548,256 — 424,490(3,204,088) — 8,182,070 — 8,182,070 ber 2013 Net increase/(decrease) in amounts due to other banks (3,148,396) 1,085,085
Profit for the year — — — — 1,554,951 — 1,554,951 — 1,554,951 Net increase/(decrease) in amounts due to customers 228,086 5,241,113 Net (decrease)/increase in debt securities issued (1,388,624) 486,144 Other comprehen- sive income for 117,805 29,809 — — 147,614 — 147,614 Net (decrease)/increase in other financial and non-financial liabilities (257,272) (726,097) the year Net cash from / (used in) operating activities 5,073,934 (7,444,854) Total compre- hensive income — — 117,805 29,809 1,554,951 — 1,702,565 — 1,702,565 for the year
Dividends to shareholders 20 — — — — — (2,950,000) (2,950,000) — (2,950,000) of the Bank
Balance 10,413,412 548,256 117,805 454,299(1,649,137) (2,950,000) 6,934,635 — 6,934,635 at 31 December 2014
66 www.expobank.ru 67 ЭкспобанкExpobank 2014 5
ANNUAL REPORT General Addresses / Contacts
General
Addresses / Contacts
(in thousands of Russian rubles) Notes 2014 2013 1| Moscow “Business Center 2| Moscow “Business Center 3| Moscow “Na Valovoy” Cash flows from investing activities “Kalanchevsky” Subsidiary Office “Malay Dmitrovka” Subsidiary Subsidiary Office Acquisition of subsidiaries, net of cash acquired 33 3,553,798 128,312 Branch Manager: Elena Pokidysheva Office Branch Manager: Maxim. Khudyakov Proceeds from disposal of a subsidiary, net of cash disposed 33 (8,181,488) — Branch Manager: Vera Ermakova Address: Address: Purchase of investment securities available for sale (3,124,657) (101,819) Moscow, ul. Kalanchevskaya, 29, blg. 2 Address: 115054, Moscow, ul. Valovaya, 6 Proceeds from sale of investment securities available for sale 33 4,001,788 784,277 Working hours: 127006, Moscow, ul. Malaya Dmitrovka, 20 Working hours: Working hours: Proceeds from redemption of investment securities available for sale 106,958 — Individuals: Individuals: Monday — Friday: 09:00 — 20:00 Private banking — Expobank Premier: Monday — Friday: 09:00 — 18:00 Purchase of property and equipment 13 (30,483) (17,778) Lunch break: none Monday — Thursday: 09:30 — 19:00 Saturday, Sunday: closed Saturday, Sunday: closed Friday: 9:30 — 18:00 Proceeds from sale of property and equipment 17,370 22,706 Lunch break: none Legal entities: Legal entities: Monday — Friday: 09:00 — 18:00 Purchase of intangible assets 14 (8,980) (14,522) Saturday, Sunday: closed Monday — Thursday: 09:30 — 16:00 Saturday, Sunday: closed Friday: 09:30 — 16:45 Cash service for Individuals: Net cash (used in) / from investing activities (3,665,694) 801,176 Cash service for Legal entities: Lunch break: none Monday — Thursday: 10:00 — 19:00 Monday — Friday: 09:00 — 18:00 Cash flows from financing activities Saturday, Sunday: closed Friday: 10:00 — 18:00 Lunch break: none Lunch break: 14:15 — 15:00 Dividends paid to shareholders of the Bank 20 (2,950,000) — Cash service for Legal entities: Saturday, Sunday: closed Saturday, Sunday: closed Monday — Thursday: 09:30 — 17:00 Bonds issued that were purchased by the Bank for subsequent resale 19 (223,095) — Cash service for Individuals: Friday: 09:30 — 16:00 Legal entities: Monday — Friday: 09:00 — 18:00 Proceeds from bonds issued in the domestic market — 1,500,000 Lunch break: none Monday — Thursday: 09:00 — 18:00 Lunch break: 14:15 — 15:00 Saturday, Sunday: closed Friday: 09:30 — 17:00 Net cash (used in) / from financing activities (3,173,095) 1,500,000 Lunch break: none Saturday, Sunday: closed Cash service for Individuals: Saturday, Sunday: closed Telephones: Net (decrease)/increase in cash and cash equivalents 1,365,773 (4,579,220) Monday — Friday: 09:00 — 20:00 8 (800) 500-07-70, +7 (495) 231-11-11 Lunch break: none Cash service for Legal entities: Cash and cash equivalents, beginning 7 6,808,070 11,387,290 +7 (495) 228-31-31, ext. 1020 Saturday, Sunday: closed Monday — Thursday: 09:30 — 17:00 Cash and cash equivalents, ending 7 8,173,843 6,808,070 Friday: 09:30 — 16:00 Telephones: Lunch break: none Legal entities: Saturday, Sunday: closed 4| Moscow “Na Bolshoy +7(495) 231-22-83, 8 (800) 500-07-70, 8 (495) 231-11-11 Telephones: Yakimanke” Subsidiary Office +7 (495) 231-11-59 8 (495) 228-31-31, ext. 1010 Branch Manager: Dmitry Zagorsky
Address: 119180, Moscow, ul. Bolshaya Yakimanka, 23 Working hours: Individuals and Legal entities: Monday — Friday: 09:00 — 18:00 Lunch break: 13:00-14:00 Saturday, Sunday: closed Cash service: Monday — Friday: 09:00 — 17:30 Lunch break: 13:00-14:00 Saturday, Sunday: closed Telephones: +7 (495) 213-19-94
68 www.expobank.ru 69 Expobank 2014 5
ANNUAL REPORT General Addresses / Contacts
Cash service: Telephones: Telephones: 5| Branch Monday — Thursday: 09:00 — 18:00 8 (800) 500-07-70, +7 (495) 231-11-11 11| Novosibirsk 13| Krasnoyarsk “Tsentralny” 8 (800) 500-07-70, +7 (495) 231-11-11 Yekaterinburg Friday: 09:00 — 16:45 +7 (495) 228-31-31, ext. 1050 “Akademichesky” Subsidiary Operational Office +7 (495) 228-31-31, ext. 2070 Lunch break: none Office Branch Manager: Vadim Golofast Saturday, Sunday: closed Branch Manager: Andrey Pushkarev Branch Manager: Larisa Deeva Address: Telephones: 9| Branch in Perm Address: 15| Krasnoyarsk 620026, Sverdlovsk region, Yekaterinburg, 8 (800) 500-07-70, +7 (495) 231-11-11 Address: 660021, Krasnoyarsk, ul. Gorkogo, 3k “Na Parizhskoy Kommuny” +7 (495) 228-31-31, ext. 1080 Branch Manager: Natalia Melnik ul. Rozy Luxemburg, 49 630090, Novosibirsk, pr-kt Akademika Working hours: Operational Office Koptyuga, 15 Working hours: Address: Individuals: Branch Manager: Ekaterina Vlassova 614000, Perm, ul. Pushkina, 84 Working hours: Individuals: 7| Surgut Monday — Thursday: 09:00 — 18:00 Address: Monday — Thursday: 09:00 — 18:00 Working hours: Individuals: Friday: 09:00 — 16:45 “Na Lenina” Operational Office 660049, Krasnoyarsk, ul. Parizhskoy Friday: 09:00 — 16:45 Individuals: Monday — Friday: 09:00 — 19:00 Lunch break: none Saturday, Sunday: closed Kommuny, 33 Lunch break: none Branch Manager: Elizaveta Nikolaeva Monday — Friday: 09:00 — 18:00 Lunch break: none Saturday, Sunday: closed Lunch break: none Saturday, Sunday: closed Legal entities: Working hours: Address: Legal entities: Saturday, Sunday: closed Monday — Thursday: 09:00 — 18:00 628426, Tyumen region, Khanty-Mansiisk Legal entities: Individuals: Monday — Thursday: 09:00 — 18:00 Monday — Friday: 09:30 — 17:00 Friday: 09:00 — 16:45 Autonomous District — Yugra, Surgut, Legal entities: Monday — Friday: 09:00 — 18:00 Friday: 09:00 — 16:45 Lunch break: none Lunch break: none pr. Lenina, 66 Monday — Friday: 09:00 — 18:00 Lunch break: none Saturday, Sunday: closed Lunch break: none Lunch break: none Saturday, Sunday: closed Saturday, Sunday: closed Saturday, Sunday: closed Working hours: Saturday, Sunday: closed Cash service: Cash service: Legal entities: Cash service: Individuals: Cash service: Monday — Friday: 09:00 — 19:00 Monday — Thursday: 09:00 — 18:00 Monday — Friday: 09:00 — 18:00 Friday: 09:00 — 16:45 Monday — Thursday: 09:00 — 18:00 Monday — Thursday: 09:00 — 18:00 Monday — Friday: 09:00 — 18:00 Lunch break: none Lunch break: none Lunch break: 13:00 — 13:30 Friday: 09:00 — 16:45 Friday: 09:00 — 16:45 Lunch break: 13:00 — 13:45 Saturday, Sunday: closed Saturday, Sunday: closed Lunch break: 12:45 — 13:30 Lunch break: 13:00 — 13:45 Saturday, Sunday: closed Saturday, Sunday: closed Telephones: Saturday, Sunday: closed Saturday, Sunday: closed Cash service: Telephones: 8 (800) 500-07-70, +7 (495) 231-11-11 Telephones: Monday — Friday: 09:00 — 18:00 8 (800) 500-07-70, +7 (495) 231-11-11 Telephones: Telephones: 8 (800) 500-07-70, +7 (495) 231-11-11 +7(495) 228-31-31, ext. 2020 Lunch break: 14:00 — 14:30 +7 (495) 228-31-31, ext. 2040 8 (800) 500-07-70, +7 (495) 231-11-11 8 (800) 500-07-70, +7 (495) 231-11-11 +7 (495) 228-31-31, ext. 2010 Saturday, Sunday: closed +7 (495) 228-31-31, ext. 3010 +7 (495) 228-31-31, ext. 1090 Telephones: 12| Kemerovo 8 (800) 500-07-70, +7 (495) 231-11-11 10| Branch in Novosibirsk “Kuzbassky” Operational Office 14| Krasnoyarsk +7 (495) 228-31-31, ext. 2050 6| Surgut 8| Branch “Na Svobodnom” Operational “Surgutsky” Operational Office in Saint Petersburg Branch Manager: Anna Bogdanova Branch Manager: Andrey Morozov Office
Branch Manager: Svetlana Ivanova Branch Manager: Pavel Galan Address: Address: Branch Manager: Natalia Khromova 16| Krasnoyarsk 630099, Novosibirsk, Krasny prospect, 25 650000, Kemerovo, Central district, ul. “Na Vzletke” Operational Office Address: Address: Krasnaya, 4, office 48 Address: Working hours: Branch Manager: Kseniya Vekovenko 628403, Tyumen region, Khanty-Mansiisk 196084, Saint Petersburg, Moskovsky 660028, Krasnoyarsk, ul. Novosibirskaya, Working hours: Autonomous District — Yugra, Surgut, prospect, 74, bldg. A, office 3H Individuals: 48 Address: district 33, ul. 30 let Pobedy, 41 Monday — Friday: 09:00 — 19:00 Individuals: Working hours: Working hours: 660077, Krasnoyarsk, ul. 78 Lunch break: none Monday — Friday: 09:00 — 18:00 Working hours: Dobrovolcheskoy brigady, 14, bldg. A Individuals: Saturday, Sunday: closed Lunch break: none Individuals: Individuals: Monday — Friday: 09:00 — 18:00 Saturday, Sunday: closed Monday — Friday: 09:00 — 18:00 Working hours: Legal entities: Monday — Thursday: 09:00 — 18:00 Lunch break: none Lunch break: none Monday — Friday: 09:00 — 18:00 Legal entities: Individuals: Friday: 09:00 — 16:45 Saturday, Sunday: closed Saturday, Sunday: closed Monday — Friday: 09:00 — 18:00 Lunch break: none Lunch break: none Monday — Friday: 09:00 — 18:00 Legal entities: Lunch break: none Legal entities: Saturday, Sunday: closed Saturday, Sunday: closed Lunch break: none Monday — Thursday: 09:00 — 18:00 Saturday, Sunday: closed Monday — Friday: 09:00 — 18:00 Saturday, Sunday: closed Cash service: Legal entities: Friday: 09:00 — 16:45 Lunch break: none Monday — Friday: 09:00 — 19:00 Cash service: Legal entities: Monday — Thursday: 09:00 — 16:30 Lunch break: none Saturday, Sunday: closed Monday — Friday: 09:00 — 18:00 Friday: 09:00 — 16:15 Saturday, Sunday: closed Lunch break: none Monday — Friday: 09:00 — 18:00 Lunch break: none Cash service: Lunch break: none Saturday, Sunday: closed Lunch break: none Cash service: Saturday, Sunday: closed Monday — Friday: 09:00 — 18:00 Saturday, Sunday: closed Saturday, Sunday: closed Telephones: Monday — Friday: 09:00 — 18:00 Lunch break: 13:00 — 13:30 8 (800) 500-07-70, +7 (495) 231-11-11 Telephones: Lunch break: none Saturday, Sunday: closed 8 (800) 500-07-70, +7 (495) 231-11-11 Saturday, Sunday: closed +7 (495) 228-31-31, ext. 2030 +7 (495) 228-31-31, ext. 1070
70 www.expobank.ru 71 Expobank 2014
ANNUAL REPORT
Cash service: Monday — Friday: 09:00 — 18:00 18| Branch in Krasnodar 19| Branch in Yakutsk Lunch break: 13:00 — 13:30 Saturday, Sunday: closed Branch Manager: Alexander Tolpygin Branch Manager: Evgeny Menyaylov
Telephones: Address: Address: 8 (800) 500-07-70, +7 (495) 231-11-11 350001, Krasnoвфк, Karasunsky District, 677999, the Sakha (Yakutia) Republic, +7 (495) 228-31-31, ext. 2080 ul. Shevchenko, 134/1 Yakutsk, prosp. Lenina, 24 Working hours: Working hours:
17| Novokuznetsk Individuals: Individuals: Monday — Thursday: 09:00 — 18:00 Monday — Thursday: 09:00 — 17:00 “Novokuznetsk” Operational Friday: 09:00-16:45 Friday: 09:00-16:45 Office Lunch break: none Lunch break: none Branch Manager: Lyudmila Chernyak Saturday, Sunday: closed Saturday, Sunday: closed Legal entities: Legal entities: Address: Monday — Thursday: 09:00 — 18:00 Monday — Thursday: 09:00 — 16:00 654007, Kemerovo region, Novokuznetsk, Friday: 09:00-16:45 Friday: 09:30 — 16:00 Central District, prosp. N.S. Ermakova, 9A Lunch break: none Lunch break: none Working hours: Saturday, Sunday: closed Saturday, Sunday: closed Individuals: Cash service: Cash service for Individuals: Monday — Thursday: 09:00 — 18:00 Monday — Thursday: 09:00 — 17:30 Monday — Thursday: 09:15 — 17:00 Friday: 09:00 — 16:45 Friday: 09:00-16:15 Friday: 09:00 — 16:45 Lunch break: none Lunch break: 12:45 — 13:30 Lunch break: none Saturday, Sunday: closed Saturday, Sunday: closed Saturday, Sunday: closedv Legal entities: Telephones: Cash service for Legal entities: Monday — Thursday: 09:00 — 18:00 +7 (861) 214-32-77 Monday — Friday: 09:00 — 16:00 Friday: 09:00 — 16:45 Lunch break: none Lunch break: none Saturday, Sunday: closed Saturday, Sunday: closed Telephones: Cash service: +7 (4112) 23-40-04 Monday — Thursday: 09:00 — 17:30 Friday: 09:00 — 16:15 Lunch break: 12:45 — 13:30 Saturday, Sunday: closed Telephones: +7 (3843) 91-09-23
Data as of 01 July 2015 ©Design by YellowDog
72 www.expobank.ru ANNUAL REPORT 2014
BUSINESS IN THREE DIMENSIONS