VTB 24 was established on the basis of Guta-Bank that was badly hit by the inter-bank crisis in 2004 and purchased by Vneshtorgbank (now VTB Bank), with the Bank of Russia playing an active role. Guta-Bank was renamed Vneshtorgbank Retail Services in 2005, and turned into VTB 24 in November 2006. The bank changed its corporate status to a public joint stock company (PJSC) in October 2014.
VTB Bank controls 99.93% of VTB 24 shares, with 0.07% falling to minority shareholders. Since July 2005 VTB 24s management board has been chaired by Mikhail Zadornov who held the position of the Russian finance minister from November 1997 through May 1999 (including August 1998). It is noteworthy that VTB 24 gained control over Bryansk-based Bezhitsa-Bank in late April 2012. The latter was firmed renamed Leto Bank, and later it was used as a hub for Pochta Bank (50% + 1 share are held by VTB 24, and the second holding is in the hands of a Russian Post subsidiary). VTB Group announced the merger of its two banks (VTB 24 and Transcreditbank, the latter was folded into VTB 24) in late October 2013, and that the Transcreditbank brand ceased to exist in November 2013. As a result of this integration, VTB 24s retail credit portfolio expanded by around 11%, while retail deposits grew by 5.2%. The banks united client base totals around 12 mln of active clients, with total headcount of 34,500 (28,000 at VTB 24 and the rest at Transcreditbank).
VTB Banks supervisory board decided on November 2, 2016 to merge VTB 24 with VTB Bank, which is planned to be carried out by end 2017.
Being part of international banking group VTB, VTB 24 specializes in dealing with households, individual entrepreneurs and small businesses. The banks sales network comprises over 1,060 offices in 72 constituent entities of Russia, including eight branches in the countrys largest cities. As of October 1, 2016 the lenders headcount averaged 31,725.
The lending institution offers clients a broad array of standard banking services, including cash, mortgage and auto loans, deposit accounts, online banking, brokerage services, safe deposit box lease, wire transfers (including via Western Union), bank cards powered by Visa and MasterCard, private banking and other services. By late 2017 VTB Groups merged ATM network will grow to 17,000—18,000. In 2015, VTB 24s bank card portfolio totaled around 16 mln of valid cards. Around half of the cards was issued as part of payroll projects. Specifically, in 2015 the bank began to serve 768,000 new payroll clients, while the total number of valid payroll cards reached 4.5 mln. The bank entered into payroll agreements in 2015 with such companies as Bashneft, the Interior Ministry of Russia, the Emergency Ministry of Russia, the Healthcare Ministry of Russia, Evraz and Russian Railways companies that are beyond migration from former Transcreditbank. One of the major advantages from Transcreditbanks takeover by VTB 24 is that VTB 24 received 2 mln of new clients in 100 towns. Thus, the banks merged clientele reached roughly 12 mln of active clients.
From January through October (inclusive) 2016 VTB 24s net assets expanded 7.7%, or by Rub 229.9 bln, in absolute terms, reaching Rub 3.2 tln as of November 2016. As regards liabilities, business expanded on the back of an inflow of retail deposits and funds into settlement accounts and short-term deposit accounts held by enterprises and organizations. Moreover, balances held on inter-bank loro accounts climbed by several times, and equity capital grew as well. On the assets side, drawn liquidity was mainly allocated to retail lending (the portfolio jumped by 10.9). In addition, the bank doubled provisions against high-liquidity balances.
Also, 63.3% of the lenders liabilities falls to retail deposits, 12.4% to balances held on settlement and deposit accounts of businesses and institutions, 3.5% to funds borrowed from banks (inter-bank loans) and balances held on loro accounts, and the rest mainly to equity capital. Issued debt securities are not higher than 1% of liabilities. Monthly turnover on client accounts is Rub 2—3 tln.
As for assets, 55.3% falls to the credit portfolio (up 9.5% since the beginning of 2016 to Rub 1.77 tln as of early November 2016).
As of the balance sheet date, 84.7% of the credit portfolio fell to retail loans, and the remainder to corporate loans. During the first ten months of 2016 the retail portfolio rose by 10.9% (or by Rub 151.86 bln), while the corporate portfolio grew marginally (0.8% or Rub 1.75 bln). Most retail loans were granted for over three years, and corporate loans for mid- and long-term periods. Since January 1, 2016 overdue debt has decreased by 4.5%, accounting for 7.44% of the credit portfolio (8.53% at the beginning of the year). Provisions equal 10.7% (11.5% as of year start), with 40.5% of the portfolio being collateralized (41.7% in early 2016).
Also, 26% of net assets falls to inter-bank loans that were extended in the domestic market mainly for more than six months. The money was supposedly granted to a subsidiary, Pochta Bank.
The banks securities portfolio is modest (Rub 216.2 bln as of November 1, 2016, or 6.7% of net assets), and contracted a bit during the period under review (down 3.8%, or Rub 8.4 bln). Around 95% of the portfolio falls to bonds (corporate bonds placed by non-residents and Russian concerns, and also OFZs), and the rest to stocks of Russian businesses.
Previously a big share of the bond portfolio was collateralized under repurchase transactions, but by end 2015 the portion of these securities was cut to the minimum, and presently the bank draws liquidity under repurchase transactions only in small amounts. Over the past few months turnover of the banks repurchase transactions has ranged from several tens to hundreds of billions of rubles.
VTB 24 both lends and borrows in the inter-bank lending market, being a net creditor in the past few months. The bank is aggressive in the currency market.
According to the banks RAS financial statement, the bank earned Rub 31.6 bln in January-October 2016 against a Rub 6.96 bln loss in the same period of 2015. The banks FY15 net profit totaled Rub 500 mln.
The Supervisory Board: Andrey Kostin (chairman), Mikhail Zadornov, Valery Lukianenko, Herbert Moos, Mikhail Oseyevsky, Andrey Puchkov, and Vasily Titov.
The Management Board: Mikhail Zadornov (chairman and president), Anatoly Pechatnikov, Vyacheslav Vorobiev, Mikhail Kozhokin, Veniamin Polyantsev, Alexander Melenkin, Sergey Rusanov, Alexander Sokolov, Valery Chulkov, and Nadia Cherkasova. Hide