OREANDA-NEWS. March 23, 2010. VTB board member, Ekaterina Petelina disclosed some of the details of VTB’s development strategy. By 2013, VTB plans to bring the value of its shares to RUB 0.15. The return on equity should rise to at least 15% in the long-term. In addition, VTB plans to expand more into the retail segment and enlarge the volume of retail liabilities from 6% to 9-10% and that of retail loans from 10-11% to 15-16%.

The expansion of retail operations should help the bank improve the profitability of its loan portfolio; at the same time, we note that retail deposits are rated as one of the most expensive types of bank liabilities. Moreover, retail lending has traditionally been a more risky activity. The expansion into the retail segment should permit VTB to enlarge the scale of its operations, but is unlikely to have any notable upward impact on either interest or profit margins. The plan to bring ROE to 15% is in line with our previously published estimates.