Total assets grow by 65.1%. Profit before tax at RUB 3 bln. Corporateloan portfolio reaches RUB 77.3 bln. Growing importance of retailbanking: private loan portfolio surges by 90.4% to RUB 19.8 bln.
ZAORaiffeisenbank Austria has ended the year 2005 with outstanding results.It achieved 65.1% growth in total assets to RUB 135.1 bln (RUB 81.8 blnas of the year-end 2004), while the assets growth of the whole Russianbanking system was 39.4%. Due to these successful results Raiffeisenbankadvanced to the 9th position among the largest Russian banks in terms ofassets (CEA Interfax).
Profit before tax climbed to RUB 3 bln (2004: RUB 2 bln), while netprofit was up 47% on the figure for 2004 and amounted to RUB 2.2 bln(2004: RUB 1.5 bln). Shareholders’ equity grew by 105.2% to RUB 14.6 bln (2004: RUB 7.1). All figures according to International Financial Reporting Standards (IFRS).
“Raiffeisenbank has achieved excellent results in 2005 and further improved its leading positions in the Russian market. Despite tough competition from foreign as well as Russian banks, the Bank delivered an exceptional growth rate, - said Johann Jonach, Chairman of the Managing Board of Raiffeisenbank Austria. “At present the banking sector sees high growth which is mainly due to the growing demand for banking services. Accordingly we expect a continued positive development also in 2006.”
Corporate Loan Portfolio grew by 57.3% to RUB 77.3 bln.
Once again Raiffeisenbank confirmed its reputation as a reliable partnerin providing high quality services to Russian and foreign companiesoperating in Russia. In 2005 Raiffeisenbank achieved outstanding growthrates in terms of corporate banking. As of the year-end the Bank’s
corporate loan portfolio surged by 57.3% to RUB 77.3 bln (2004: RUB 49.1
bln). Its corporate client base reached 4,700 companies (including
brokerage and insurance companies, as well as SME) with a sound increase
in the sector of medium-sized enterprises. On averagethe Bank''s client
base grows by 30% p.a., mostly due to the regional expansion. Pavel
Gourine, Member of the Managing Board, Head of Corporate Banking and
Corporate Finance, stated: “In 2005 the Bank continued to actively
develop and improve its corporate finance programs. Raiffeisenbank began
issuing rouble loans linked to the MosPrime rate, which is an important
practical step towards satisfying the growing customer demand for rouble
financing. As a result the share of loans denominated in rubles in the
overall loan portfolio increased significantly. Additionally, a positive
sign of further credit portfolio optimization is the continuing decline
in the concentration of loans to the Bank’s largest borrowers”.
StructuredTrade and Project Finance. Raiffeisenbank is an acknowledged player infinancing of commercial real estate.
During the year the Bank has been very active in expanding its ProjectFinance activities and confirmed its leading position in the real estatemarket. The Bank is steadily increasing its loan portfolio in thissegment, which at the end of 2005 overcame RUB 11 bln, a 50% increaseover the year.
Raiffeisenbank also continued to develop and further strengthened itsleading position in structured trade finance. Among others the Bankarranged structured investment loans for major transport and industrialcompanies. In 2005 the Bank’s loan portfolio in this segment grew by 44.5%.
Strengthened positions in the corporate finance and investment-bankingmarket: Raiffeisenbank is the Best Syndicated Loans Arranger.
In the past year Raiffeisenbank confirmed its sound positions in theinternational and local capital market. During the year the Bank actedas arranger of 15 corporate bond issues in a total amount of over RUB 36bln. It also arranged 16 syndications in a total value of RUB 37.4 bln.The Bank ranked 1st by number of syndicated loans arranged for Russianborrowers in 2005 (according to Dealogic Research Company) and for thesecond time earned the title of Best Syndicated Loans Arranger 2005 inRussia awarded by Global Finance magazine.
Pavel Gourine stated,“In anticipation of considerable growth in the demand from potential borrowers for rouble resources, the Bank was the first to focus seriously on the rouble syndicated loans market”. In the second half of 2005 Raiffeisenbank acted as the arranger of three syndicated rouble loans for Russian regional banks. The loan to Êrayinvestbank (Krasnodar) was the first loan issued based on an indicative MosPrime rate, a new market index proposed by the National Currency Association.
Treasury Operations. Participation in the establishment and furthersupport of the MosPrime index.
Raiffeisenbank was very active in nearly all segments of the Russianfinance market, including currency and money markets, stock and bondmarkets. An increased range of finance products combined with highquality services stimulated the activity of the Bank’s clients and further raised the volume of client transactions. “Another evidence of Raiffeisenbank’s key role in the money market is its active participation in the establishment and further support of the MosPrime index, which has by now become one of the most important indicators of the cost of short term rouble borrowings in the Russian market”, commented Sergei Monin, Member of the Board, Head of Treasury.
Growing importance of retail banking. Private loan portfolio grew by90.4%.
Taking into account Raiffeisen International Group’s strategy for further expansion in the CEE markets and especially in the area of retail banking, Raiffeisenbank keeps its leading role in this segment in Russia. In 2005 total loans issued to individuals since the foundation of the Bank exceeded RUB 28.8 bln (USD 1 bln). The retail loan portfolio as of the end of 2005 reached RUB 19.7 bln (2004: RUB 10.3 bln) with a rise of 90.4% over the year. According to CEA Interfax, Raiffeisenbank ranked 6th among all Russian banks in terms of retail lending.
Car loans made up 61.7% of Raiffeisenbank’s total retail loan portfolio. The car loan portfolio as of the end of 2005 reached RUB 12 bln (2004: RUB 6.2 bln) showing a strong 93.1% growth. The Bank’s mortgage lending reached 22.7% of the total retail loan portfolio. According to RBC.Rating 2005 Raiffeisenbankranked 3rd in terms of mortgage loans with a total amount of RUB 4.4 bln (2004: RUB 2,4 bln) showing a 78.8% growth. Unsecured consumer loans were also in great demand during the year and the respective loan portfolio increased by 75% to RUB 2.6 bln (2004: RUB 1.4 bln).
Raiffeisenbank also surpassed the threshold of RUB 28.8 bln (USD 1 bln)in private deposits in 2005. Its growth over the year amounted to 65.2%(from RUB 21.3 bln at the end of 2004 to over RUB 35.1 bln at 2005year-end). Raiffeisenbank ranked 9th among all Russian banks in terms ofprivate deposits (CEA Interfax).
Further branch network expansion.
In 2005 Raiffeisenbank opened 6 new branches in Moscow and SaintPetersburg. New regional branches were launched in Ekaterinburg, Samaraand Novosibirsk; the fifth regional branch in Chelyabinsk started itsoperations in March 2006. Johann Jonach said:“The regions are home to established large corporations and fast-growing small and medium-sized enterprises, and people in the provinces are more and more demanding quality banking services – Raiffeisenbank’s clear focus is on serving both current and new private and corporate clients in the regions.”
Raiffeisen Capital Asset Management Company.
In 2005 Raiffeisen Capital Asset Management Company was rated as one ofthe most dynamic asset managers in the Russian market 6th, according toVedomosti newspaper, in terms of capital attracted by unit investmentfunds (UIFs)). During the year, the volume of assets under managementincreased 10.2 times and the total number of clients increased 6.5times. In 2006 Raiffeisen Capital Asset Management Company plans to morethan double its assets under management mainly through increasing retailsales and expanding the product line (it plans to create two new UIFsand further promote investment banking products).
Non-State Pension Fund Raiffeisen.
In 2005 assets under management of Raiffeisen Pension Fund increased by83% and reached RUB 87.9 mln. A further nine corporate clients wereadded to the client portfolio of Raiffeisen Pension Fund during theyear. The total number of corporate clients of Raiffeisen Pension Fundwas 69, and the number of individual participants exceeded 22 000 as atthe end of 2005. Raiffeisen Pension Fund continued to participate inpension reform: more than 2 500 individuals entrusted the fund to managetheir accumulated pension funds. Contracts for the transfer ofaccumulated pensions were executed both in corporate clients’ offices and ZAO Raiffeisenbank Austria branches.
Raiffeisen Leasing was one of the leaders in the Russian leasing marketin 2005. The Company invested EUR 70 mln to purchase new items forleasing; assets as at the end of 2005 were EUR 130 mln. The Company hasa diversified portfolio, which includes various equipment, cars,railcars and other wheeled machinery. Raiffeisen-Leasing’s plans for 2006 include entering the mass consumer market. This niche will allow Raiffeisen-Leasing to significantly increase the rate of growth and profitability of its leasing portfolio.
Ratings and Awards.
The Bank’s successful dynamics and commitment to the highest standards of transparency and reliability are illustrated by a set of awards and ratings given to the Bank during the year. Some of the other key highlights for Raiffeisenbank in 2005 were Best Overseas Bank in RussiaAward from Global Finance magazine and Best Consumer Internet Bank. In addition, the Equity Market magazine recognized Raiffeisenbank for The Best Innovation on the Equity Market in respect of the unique structuring of the bond issue organized by the Bank for Baltika Brewery.Golden Diploma for informational transparency and impeccable business record in nomination «Foreign company operating in Russia» was awarded by the Russian Financial Press-Club. Moody’s Interfax Rating Agency upgraded our rating for long- and short-term foreign currency deposits to Baa2/Prime-2. This is the best possible rating for a private company in Russia, which is constrained by Russia’s Baa2 country ceiling. This reflects the strength of Raiffeisenbank in Russia as well as the strength of Raiffeisen Banking Group that stands behind ZAO Raiffeisenbank Austria.
ZAO Raiffeisenbank Austria is a subsidiary of Raiffeisen InternationalBank-Holding AG (Raiffeisen International). Raiffeisen Internationaloperates one of the leading banking networks in Central and EasternEurope with 16 subsidiary banks and many leasing companies in 16markets. As of year-end 2005, 9.7 million customers were serviced inmore than 2,400 business outlets. Representative offices in Lithuaniaand Moldova complement the Group''s presence in the region. RaiffeisenInternational is a fully consolidated subsidiary of RaiffeisenZentralbank Oesterreich AG (RZB), which owns 70 per cent of the commonstock. The remaining 30 per cent is free float, the shares are traded onthe Vienna Stock Exchange. RZB is a leading corporate and investmentbank in Austria and the central institution of the Austrian RaiffeisenBanking Group, the country''s largest banking group. On 1 FebruaryRaiffeisen International announced the acquisition of Impexbank subjectto all necessary approvals. A respective closing process is currentlyundertaken and to be finalized until 15 May.
Annual results of Raiffeisen International are available athttp://www.raiffeisen.ru/rBank/news/1143708597109
* At 31 December 2005 the principal rate of exchange used fortranslating foreign currency balances was USD 1 = RUB 28.7825 (2004: USD1 = RUB 27.7487).