VTB Bank

VTB Bank (Russian: ПАО Банк ВТБ, former Vneshtorgbank, lit. foreign trade bank) is one of the leading universal banks of Russia. VTB Bank and its subsidiaries form a leading Russian financial group – VTB Group, offering a wide range of banking services and products in Russia, CIS, Europe, Asia, Africa, and the U.S.

"VTB" redirects here. For other uses, see VTB (disambiguation).

JSC VTB Bank
ПAO
Traded asMCX: VTBR
LSE: VTBR
IndustryBanking
PredecessorSberbank of the USSR 
Founded1990 (1990)
HeadquartersMoscow, Russia
Area served
Russia, CIS, Europe, Asia, Africa, U.S.
Key people
Andrey L. Kostin
(President and Chairman of the Management Board)
Anton Siluanov
(Chairman of the Supervisory Council)
ServicesFinancial services
Revenue RUB 468,6 billion (2018)[1]
RUB 214.4 billion (2018)[1]
RUB 178.8 billion (2018)[1]
OwnerFederal Agency for State Property Management (60.9%)[2]
Number of employees
77 200 (2018)
WebsiteVTB.com
Old logo

VTB was ranked 446th on the FT Global 500 2012,[3] The Financial Times’ annual snapshot of the world's largest companies. It climbed to 210th in the ranking of the 500 largest companies in Europe, the FT Europe 500 2014,[4] and to 127th in the FT Emerging 500 2014, the list of the 500 largest companies on the world's emerging markets. The Moscow-based bank is registered in St. Petersburg and came 66th in the British magazine The Banker’s Top 1,000 World Banks in terms of capital in 2014. Also it has won “Bank of the Year in Russia” in The Banker magazine's “Bank of the Year Awards 2018” awards.

History

VTB Bank was founded as Vneshtorgbank in 1990 with the support of the Russian State Bank and the Ministry of Finance. It was set up as a limited liability company with the aim of servicing Russia's foreign trade operations and promoting Russia's integration into the global economy.[5]

In 2004, the bank acquired a majority stake of 85.8% in Guta Bank, which was reorganised into a retail bank, Vneshtorgbank 24 (VTB24).[6] The bank also acquired the Armenian Armsberbank, which was later renamed VTB Armenia.[7] In 2005, the bank acquired 75% plus three shares of the Promstroybank (PSB), which was reorganised as Bank VTB North-West and later became VTB's North-Western Regional Centre,[8] and bought the Ukrainian bank Mriya, which was later merged with VTB Bank (Ukraine).[9]

In 2007, the bank set up a subsidiary in Angola known as VTB África.[10] The bank also took over Slavneftebank in Belarus and later renamed it VTB Belarus.[11] In June, VTB became the first Russian bank to offer an initial public offering (IPO), raising $8 billion in what became the largest international banking IPO at the time.[12]

In 2008, the bank acquired a 51% stake in AF Bank in Azerbaijan from AF Holding International, later renaming it VTB Azerbaijan.[13] In 2010, the bank's board approved the phased acquisition of TransCreditBank from Russian Railways.[14] In 2013, VTB carried out a secondary public offering (SPO) which raised 102.5 billion rubles ($3.3 billion) and diluted the Russian government's share in VTB from 75.5 percent to 60.9 percent.[15]

In July 2014, the Office of Foreign Assets Control (OFAC) published that the Bank of Moscow and VTB Bank have been added to the Sectoral Sanctions Identifications List. Later, VTB Bank and its subsidiaries were added on the European Union sanctions list, and VTB was added on the Canadian sanctions list. Subsequently, US increases its sectoral sanctions on VTB Bank, its subsidiaries. In September: VTB was added to the Australian autonomous sanctions list.[16][17][18] The US also issued a consolidated listing of directives regarding Executive Order 13662 sanctions. Directive 1 was amended to increase the financial sanctions for "all transactions in, provision of financing for, and other dealings" in new equity or new debt issued on or after 12 September 2014 to longer than 30 days maturity. New equity or new debt issued from 29 July 2018 until 12 September 2018 was sanctioned if longer than 90 days maturity.[19][20][21][22]

In July 2015, an agreement approved by Russian Prime Minister Dmitry Medvedev for the Russian Post purchase of 50% minus 1 share of Leto Bank from VTB24, to reorganise it into the National Post Bank, with the remaining 50% plus one share to be owned by VTB24. The agreement was signed by VTB Bank CEO Andrey Kostin, Russian Post director Dmitry Strashnov and Nikolay Nikiforov, Russia's Minister of Digital Development, Communications and Mass Media. Kostin also suggested appointing Dmitry Rudenko, the current head of Leto Bank, as the head of the National Post Bank.[23].

In March 2017, Ukraine imposed sanctions against VTB Bank and subsidiaries for the alleged Russian interference in Ukraine.[24][25] In November 2017, the United States increased Executive Order 13662 sanctions, with Directive 1 amended to increase the financial sanctions for "all transactions in, provision of financing for, and other dealings" in new equity or new debt issued on or after 28 November 2017 to longer than 14 days maturity. New equity or new debt issued from 12 September 2014 until 28 November 2017 was sanctioned if longer than 30 days maturity.[26]

In August 2018, it was announced that VTB Bank would acquire a 75% stake in Vozrozhdenie Bank after its previous owners oversaw a "major banking collapse".[27] In November 2018, the National Bank of Ukraine declared the Ukrainian subsidiary of VTB Bank insolvent due to its declining liquidity and worsening financial position.[28] In December 2018, it was announced that VTB Bank would be acquiring controlling stakes in Sarovbusinessbank (81.1%) and Zapsibcombank (71.8%).[29]

Mergers and acquisitions

VTB Bank took over 15 banks between 2002 and February 2019:

  • Guta Bank (2004), later renamed VTB24
  • Bank of Moscow
  • TransCreditBank
  • Armsberbank in Armenia (2004), later renamed VTB Armenia[30]
  • Promstroybank (2005), renamed Bank VTB North-West and later reorganised as VTB's North-Western Regional Centre[31]
  • Eurobank in France (2005), later renamed VTB France[32]
  • Evrofinance Mosnarbank in Great Britain (2005), later renamed VTB Europe Plc, and then VTB Capital Plc
  • Ost-West Handelsbank AG in Germany (2005), later renamed VTB Germany[33]
  • United Georgian Bank (2005), later renamed VTB Georgia[34]
  • Mriya in Ukraine (2006), later merged with VTB Ukraine[35]
  • Slavneftebank in Belarus (2007), later renamed VTB Belarus[36]
  • AF Bank in Azerbaijan from AF Holding International (2008), later VTB Azerbaijan[37]
  • Vozrozhdenie (2018)
  • Zapsibkombank (2018)
  • SarovBusinessBank (2018).

Corporate affairs

Shareholders

The main shareholder of VTB is the Russian government,[38] which owns 60.9% of the lender through its Federal Agency for State Property Management. The remaining shares are split between holders of its Global Depository Receipts and minority shareholders, both individuals and companies.

In February 2011, the government floated an additional 10% minus two shares of VTB Bank. The private investors, who paid a total of 95.7 billion rubles ($3.1 billion) for the assets, included the investment funds Generali, TPG Capital, China Investment Corp, a sovereign wealth fund responsible for managing China's foreign exchange reserves, and companies affiliated with businessman Suleiman Kerimov.[39]

In May 2013 VTB completed a secondary public offering (SPO), issuing 2.5 trillion new additional shares by public subscription. All shares were placed on Moscow's primary stock exchange. The government did not participate in the SPO, so its stake in the bank decreased to 60.9% after the subscription closed. The bank raised 102.5 billion rubles worth of additional capital. Three sovereign wealth funds, Norway's Norges Bank Investment Management, Qatar Holding LLC and the State Oil Fund of the Republic of Azerbaijan (SOFAZ) and commercial bank China Construction Bank became the largest investors during the SPO, after purchasing more than half of the additional shares issued.[15]

Management

As of February 2019, its Management Committee consists of Andrey Kostin (Chairman since 10 June 2002), President and Chairman of VTB Bank Management Board, Member of the Supervisory Council, Dmitry Olyunin (First Deputy President and Chairman of VTB Bank Management Board), Andrey Puchkov (First Deputy President and Chairman of VTB Bank Management Board), Yuri Soloviev (First Deputy President and Chairman of VTB Bank Management Board), Denis Bortnikov (Deputy President and Chairman of VTB Bank Management Board), Olga Dergunova (Deputy President and Chairman of VTB Bank Management Board), Valery Lukyanenko (Deputy President and Chairman of VTB Bank Management Board), Anatoly Pechatnikov (Deputy President and Chairman of VTB Bank Management Board), Maxim Kondratenko (Member of VTB Bank Management Board), Erkin Norov (Member of VTB Bank Management Board), Dmitriy Pianov (Member of VTB Bank Management Board), Oleg Smirnov (Member of VTB Bank Management Board), Valery Chulkov (Member of VTB Bank Management Board).

Supervisory council

As of February 2019, VTB's Supervisory Council consists of Anton Siluanov (Chairman of the Supervisory Council), Matthias Warnig (member of the Supervisory Council),[8] Sergey Dubinin (member of supervisory council), Yves Thibault de Silguy (Independent member of supervisory council), Mikhail Zadornov (Member of Supervisory Council), Andrey Kostin (President and Chairman of VTB Bank Management Board), Shahmar Movsumov (Independent member of supervisory council), Igor Repin (Independent member of Supervisory Council), Alexander Sokolov (Member of Supervisory Council), Vladimir Chistyukhin (member of supervisory council), Mukhadin Eskindarov (Member of Supervisory Council). [40]

Financial data

Consolidated Statement of Financial Position as at 31 December 2018: net interest income – 468,6 RUB billion, net fee and commission income – 90,0 RUB billion, operating income before provisions – 641,3 RUB billion, staff costs and administrative expenses – 259,8 RUB billion, net profit – 178,8 RUB billion.[41]

Major subsidiaries
Federation West Tower (in left), is VTB's Head office in Moscow City, Moscow, Russia
VTB Bank is the owner of the Eurasia Tower in Moscow

VTB's major subsidiaries as of February 2019 were:

Company's nameShare
Insurance company VTB Insurance100%
VTB Capital100%
VTB-Leasing100%
VTB Dolgovoi centre100%
VTB Pension administrator100%
VTB Factoring100%
VTB Registrar100%
Hals-Development96.44%
VTB Arena75.00%
VTB Real Estate100%
VTB Bank (Austria) AG (incl. VTB Bank (Deutschland) AG, VTB Bank (France) SA)100%
VTB Bank (Ukraine)99,97%
VTB Bank (Armenia)100%
VTB Bank (Georgia)96.31%
VTB Bank (Belarus)100%
VTB Bank (Kazakhstan)100%
VTB Bank (Azerbaijan)51 %
Banco VTB Africa, SA (Angola)50.1%
National Post Bank (ex. Leto Bank)50 % minus 1
Tander (PJSC Magnit) 17,28%
Velobike (bike rental service) 100%
VTB Specialized Depository, CJSC 100%

Corporate social responsibility
The headquarters of VTB Armenia in Yerevan

VTB Bank sponsors sports, cultural and healthcare charities.

Sports

VTB is the principal sponsor of all Dinamo Moscow sport clubs.

Since 2017, VTB Bank has been the title partner of the Russian Formula 1 stage in Sochi – Formula 1 VTB Russian Grand Prix.

Since 2016, VTB has been the tennis tournament VTB Kremlin Cup.

VTB has also been the title sponsor of the VTB United League since 2008.

Since 2013, VTB Group has been supporting the Velobike, a bicycle-sharing system in Moscow, a project by the Department for Transport and Development of Road Infrastructure of the city. In 2018, the number of trips exceeded 3 million.

Culture

VTB is a member of the Board of Trustees for the Bolshoi Theatre, and the non-profit organisation The Bolshoi Theatre Foundation that was established in 2002. VTB has supported many of the premieres at the Bolshoi, including The Lady with the Camellias, Ivan the Terrible, Onegin, The Sleeping Beauty, The Snow Maiden, Romeo and Juliet, The Legend of Love, Manon Lescaut and others.

Since 2006, VTB has been the general partner of the Mariinsky Theatre.

Since 2002, VTB has been the general partner of the Moscow Theatre's Pyotr Fomenko Workshop.

Since 2002, the bank has been a member of the Board of Trustees for the State Tretyakov Gallery. With the support of VTB, the museum has presented many unique exhibits; among them – the exhibitions of Valentin Serov, Ivan Aivazovsky, Zinaida Serebryakova and Vasily Vereshchagin.

Cooperation between VTB and the Pushkin Museum of Fine Arts begun in 2005. The Bank supports many of the museum's exhibits such as Venice of the Renaissance, Titian, Tintoretto, Veronese and Chaim Soutine, Retrospective.

The cooperation between VTB Bank and the State Hermitage began in September 2013, where the Bank promotes the museum's exhibitions and innovative projects. In 2017, with the support of VTB Bank, the museum hosted the exhibition The Winter Palace and the Hermitage. 1917. History Was Created Here.

Since 2002, the Bank has supported exhibitions by the Russian Museum such as Diaghilev, The Beginning, Nicholas Roerich, 1874–1947, Vasily Vasilevich Vereshchagin, To the 175th anniversary of his birth, Kuzma Sergeevich Petrov-Vodkin, To the 140th Anniversary of His Birthday.

Since 2014, the Bank has provided charitable assistance to the Jewish Museum and Tolerance Center. In autumn of 2017, VTB helped organise the exhibition To Everyone on Freedom? The History of One People in the Years of the Revolution. In 2018, with support from the bank, an exhibition Isaak Levitan and Author's Cinema was held.

Since 2010, VTB Bank started supporting the legendary TV program What? Where? When?.

Healthcare

VTB also supports healthcare programmes in Russia, and provides support to the elderly, orphans and disabled people, as well as veteran organisations. Within the framework of the Bank's own charity programme ‘The World without Tears’, which celebrated its 15-year anniversary in 2018, hundreds of children and hospitals from 52 regions of Russia – from Moscow to the Kamchatka Territory – received the Bank's support. In 2018, the charity event ‘The World without Tears’ was held in 21 cities of Russia.

In addition, for several years from 2014 to 2018, VTB supported institutions that focused on children's health in the Republic of Karelia.

See also

References
  1. "Группа ВТБ объявляет финансовые результаты по МСФО за 12 месяцев и четвертый квартал 2018 года". www.vtb.ru.
  2. 4-traders. "Bank VTB PAO company : Shareholders, managers and business summary - MOSCOW INTERBANK CURRENCY EXCHANGE: VTBR - 4-Traders". 4-traders.com.
  3. "FT Global 500 2011" (PDF).
  4. "FT Europe 500 2011" (PDF).
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  7. "FACTBOX-Armenia's economy". Reuters. 15 February 2008. Retrieved 15 April 2019.
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  38. Drucker, Jesse (5 November 2017). "Kremlin Cash Behind Billionaire's Twitter and Facebook Investments: Leaked files show that a state-controlled bank in Moscow helped to fuel Yuri Milner's ascent in Silicon Valley, where the Russia investigation has put tech companies under scrutiny". New York Times. Retrieved 7 February 2018.
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