OREANDA-NEWS. On 08 June 2009 was announced, that Credit Bank of Moscow very successfully closed 2008 financial year, which is highlighted below. With total assets of USD 2,1bln the Bank showed a 24% rise for the year even against the sharp increase of US Dollar rate. Our loan portfolio making 65% of total assets improved by 24% with consumer lending increased by half. The loan portfolio quality still stands at a remarkably high level which outlines our Bank against other Russian banks in the current situation. In fact, NPL ratio is as low as 3.3%. As always, our loan portfolio concentration levels are kept amply below the industry average at 20.3% (exposure to ten largest borrowers).

CBM notably improved its profitability having announced record net income of USD 40,4mn representing year-end ROE of 18.3% contrasted to 12.9% as of the year-end 2007. Such astonishing performance stemmed from tangible rise in net interest income (63%) as well as non interest income (60%). This, in turn, was driven by a substantial leap in fees and commissions income equalling 48% comparing with 2007. This leap resulted from expansion of lending and cash collection businesses as well as forex operations. CBM’s cost to income ratio comprised 53.2% in 2008 against 65.4% in 2007 which proves the Bank’s efficiency improvement against unfavourable background in the financial markets.

We also improved our market position with retail depositors having enhanced by 35% and corporate depositors by 8%. There are now 19% more businesses on our cash collection services, us being No. 3 cash collection provider in Moscow and No. 1 bank to provide such services.

CBM’s regional expansion underwent a temporary suspension in the 4rd quarter of 2008 due to a combusted crisis, nevertheless 6 new branches were set up in the Central Federal District of Russia which together with previously opened ones comprised 8 regional branches in total. In 2009 the Bank does not have active regional penetration plans and will focus on Moscow and Moscow region development with 10 new branches to be established therein.

On liabilities side, 2008 was very successful for us both in international and domestic markets as it saw a USD 20mn SME loan facility from Black Sea Trade and Development Bank, a USD 100mn syndicated loan, the largest and the longest one over CBM’s presence in the international capital markets, a RUR2bn 3-year domestic bond issue and a USD 10mn SME loan facility from European Bank for Reconstruction and Development.

The Bank also experienced almost a 50% inflow of private deposits notwithstanding observed turmoil among depositors in the Russian market in Autumn 2008. Deposit base is kept thoroughly diversified with the average private deposit of not more than USD 10 ths and largest corporate deposit accounting for 9% of equity.

Over and above the aforesaid, we would like to touch upon our Bank’s plans for the nearest future. In the 2nd quarter of 2009 a RUR3bn equity injection is planned by CBM’s sole shareholder which is to raise the Bank’s CAR level above 20% which is a brilliant result for a Russian bank in the current conditions. CBM’s net income is to double and assets are to become half as much by the end of 2009, but still depending on the loans portfolio quality and funding facilities.