OREANDA-NEWS. September 20, 2013. Center-invest Bank hosted an international conference dedicated to the sustainable banking business model. The conference was attended by Center-invest Bank shareholders (EBRD, DEG), partners from IFC and BSTDB, banks from Austria, Germany, the USA and Azerbaijan, and representatives of the Central Bank of Russia, academic circles, and business.

The keynote speakers were the Chairman of the Board of Directors of Center-invest Bank, Dr Vasily Vysokov, and Chairman of the Management Board of DEG, Dr. Wenn.

Addressing an audience of more than sixty delegates, Dr. Vysokov presented the results of stress testing conducted for regulatory authorities, as well as a comparative analysis of the main business models for banking (speculative, state, Islamic, and sustainable banking).

It was entirely fitting that this conference was organised by Center-invest Bank. The bank has been successfully applying a sustainable banking business model for many years. This model, which is based on long-term profitability, has demonstrated its viability and effectiveness in different economic conditions.

During discussions, conference participants stressed that Center-invest Bank’s achievements in sustainable development are attributable in no small part to its effective management of regional risks. Center-invest Bank has been setting an example for the Russian financial community for the last ten years; we have shown that sustainable development in the banking sector can be both socially useful and profitable.

A wider spread of this business model to other regions would require changes in banking regulation at the international level and also within individual countries. As a crisis is difficult to predict, we must be prepared. We must also take heed of the experience of German banks, which for centuries were focused on the sustainable development model. However, the system was not safeguarded against the temptation to make a profit on speculative markets. Sustainable banking requires banks to continuously improve on their work and to actively enagage in shaping a new generation of bank employees and clients.

Sustainable banking entails more rigorous self-regulation of corporate governance, strategic business planning, reporting under international and Russian standards, and careful asset and liability management. It is based on the real economy and comprehensive internal control, as well as risk management using a combination of methods. This allows for the continuous development of operations, products and relationships with customers and investors. It is only by applying best international practice that profitability can be achieved with such strict self-regulation.

Center-invest Bank applies this same principle in its work with its clients, helping them to acquire new equipment and technology that is 3-5 times more efficient than existing resources and enabling them to manufacture products that are competitive in global markets. The success of sustainable investments can be seen clearly by the effect modernization has had on small businesses. During the conference a number of Center-invest Bank’s customers (including a paper factory, a confectionary factory, and a bakery) presented their companies and spoke about how the sustainable banking business model had allowed them to enter global markets.

Reflecting the growing role of infrastructure in the development of the global economy, experts from Center-invest Bank spoke about the bank’s experience in financing energy efficiency projects and the opportunities afforded by public private partnerships.

The secret of our success in financing energy efficiency projects lies in our partnerships with international financial institutions, which provide not only long-term resources, but also access to best international practice. To overcome the challenges of localizing best practice, Center-invest bank developed its own special approach, based on technical, financial and social engineering. Center-invest Bank’s work in this area has been so successful that today it is also considered “best international practice”.

During the conference, Center-invest Bank, its partner banks, development institutions, and leading regional and federal media outlets shared their experience and agreed on areas for future joint work to develop and promote the sustainable banking business model.