VTB shareholders doubtful about its prospects
The fact that VTB’s current share price is lower than that paid when the bank was first floated has caused unease among some shareholders who gathered in St. Petersburg on Thursday.
“Russian financials, in line with global financials, have been out of favour since the start of the credit crunch in the middle of last year. That's a problem for minority shareholders because they feel they should be getting more value having bought the shares at IPO level,” commented Renaissance Capital Equity Strategist Tom Mundy.
There have been calls for the management to resign, from those concerned about the future performance of Russia’s second largest bank
In response to this, VTB Chairman and CEO Andrey Kostin explained that managers are also shareholders, and they, too, feel the effects of poor performance. However, he is optimistic about the bank’s retail branch, VTB24.
“We are planning to increase the number of retail offices to 500 this year across Russia. We think that retail is a very fast-growing area and we want to be a leader in this area, providing more loans to Russian people,” he said.
The bank’s head predicted a higher level of net profit for the first half of 2008 than in the same period last year, when it was $509 million.
Meanwhile, as shareholders and VTB plan their next steps, they are keeping in mind not only the losses incurred so far, but also the management’s sticking to a plan of recovery and success.