OREANDA-NEWS. April 14, 2011. Sviaz-Bank has published its 2010 consolidated financial statements prepared in accordance with the International Accounting Standards (IAS) and certified by an independent auditor, Ernst & Young Vneshaudit CJSC, reported the press-centre of Sviaz-Bank.   

During the year 2010, the Bank continued to build up its resources, consolidate and expand its relationships with its key customers, and involve new customers in cooperation projects. Doubling of the total funds accepted by the Bank in deposits from individual and corporate customers is evidence of trust in which the Bank is held. As of January 1, 2011, the total customer funds deposited with the Bank reached 98.3 billion rubles.

The Bank’s loan portfolio increased by 54.4% through the year, to 78 billion rubles reported on December 31, 2010. Its securities portfolio, most of which are bonds from first-class corporate issuers, had grown by 63.7% to 47.4 billion rubles.

Growth in the scale of transactions to attract and invest funds led to a significant growth in the key components of the Bank’s revenue-earning base. At the end of 2010, it showed a net interest margin of 4.7 billion rubles, or 25.4% more than it did in 2009, and its net interest income rose by 45.6% to 1billion rubles. Its net operating income from its core business amounted to 7.6 billion rubles.

Expansion of the Bank’s operations and its ultimate restoration to good financial health required expenses to be increased accordingly to sustain the Bank’s operations and develop its infrastructure and information technologies (IT). The Bank’s total operating expenses reached 5.7 billion rubles in 2010, or 21.7% more than the Bank spent in 2009.

The Bank recorded 2.8 billion rubles in net positive financial results in 2010, less one-time transactions.

The Bank’s one-time transaction to sell its parent institution under its plan to restore its problem-ridden assets back to health had a major effect on its 2010 yearend performance. The transaction purged the Bank’s balance sheet of the problem assets it had accumulated in 2006 through 2008. The Bank sold its problem debt to Vnesheconombank at a price below its IAS book value, and the sale produced a negative financial effect valued at 2.8 billion rubles. Eventually, the sale of financial assets pulled the Bank’s reserve requirements down to 4.6% at the end of 2010.

By selling its problem assets the Bank made a loss of 22 million rubles at the end of 2010, less the expenses it incurred to pay the profit tax. Its net loss reached 118 million rubles.

On December 31, 2010, the Bank had 41.6 billion rubles in capital, according to the IAS, and a capital adequacy ratio required under the Basel Agreement at 35.2%, which allows the Bank to make ambitious plans for developing all types of operations.