Russian banking growth and VTB

At the world economic Forum at Davos, RT Business spoke with Andrei Kostin, Head of VTB, about the banks upcoming share placement and the perception of Russia on the part on international investors.

RT: Who are you targeting with the upcoming placement?General public, Russians, foreigners?

AK:“We are not talking about private individuals because the new placement, in any case, is for institutional investors only.Otherwise we very much welcome both Russian and foreigners, and I think we have no difference between this.”

RT: Why don’t you want investors from the general public to participate in the upcoming placement?

AK:“It’s just that it’s a different kind of listing, and I think that in this case we are talking about institutional investors.”

RT: How much will EU Fiscal problems affect VTB performance?

AK:“No, we are not so much concerned about this.We expect a very big growth of profit this year.We are planning that our net profit will grow by 60% and I think that whatever conditions, environment, is anyway, acceptable, for us to provide further growth, improving further our financial results.”

RT: What will be the drivers of that increased profit?Is it the investment banking?

AK:“It’s our emphasis on more efficiency. According to our new strategy we published last June we focused particularly on efficiency and we are planning to make our main business, corporate business, more efficient.We will definitely develop our investment business further, and we will have substantial growth of our retail business, which is also a high margin business.”

RT: You are a global top 50 bank, where do you want to be in the medium term, do you want to be a top 20?

AK:“We do not have a specific target for this. We think that as Russia expects sound growth for the next years, I think Russian banking sector should go in line with this. And I think we have been developing very quickly over the last 10 years, and we are planning to develop further.Of course we will not become much larger and play more important role in the world unless the Russian economy provides sound growth.But we very much expect that that is going to happen.”

RT: Mr Putin expects Russian business leaders to take up more sport.Are you going to take up tennis, boxing, running?

AK:“We have a lot of sport activity among our managers, but as Mr Putin recommended this we will definitely put more emphasis on this.”

RT: What have foreign investors been saying here about the Russian economy and VTB, are they excited?

AK:“I think that they are quite positive, even during these two days in Davos, there was a number of important deals announced, like PepsiCo buying Wimm-Bill-Dann, and Rosneft signing an important agreement with ExxonMobil.So I think that’s a sign of growing interest on the part of foreign investors about Russia.”