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VTB increases stake in Bank of Moscow to 80.57%, consolidates Bank of Moscow into VTB Group

29 September 2011

VTB increases stake in Bank of Moscow to 80.57%, consolidates Bank of Moscow into VTB Group.

VTB Group has today increased its stake in the Bank of Moscow to 80.57% as VTB Debt Centre, a 100% subsidiary of VTB Group acquired additional shares from Bank of Moscow minority shareholders. 

The transaction took place under the General Agreement on measures for financial support for the Bank of Moscow, which was signed in July 2011 by Bank of Moscow, the Deposit Insurance Agency (DIA) and VTB Group companies – VTB Debt Centre and VTB Pension Administrator. According to the General Agreement, after VTB Group consolidates BoM shares up to at least 75%, the DIA will grant a 10 year loan of up to RUB 295 billion to BoM at a below market interest rate. The proceeds of the loan will be invested in Russian government securities. 

The transaction will allow the Bank of Moscow to book a profit with an economic effect of RUB 150 billion under IFRS.

Andrey Kostin, VTB Bank President and Chairman of the Management Board, said “Acting in line with the Bank of Moscow financial support plan, we have reached one of the key targets and consolidated more than 80% of BoM shares. Integrating Bank of Moscow into VTB Group will significantly enhance the Group’s position on the Russian banking market, increase the Group’s branch network, and improve the quality of products and services on offer for both corporate and retail customers.” 

As a further step in implementing the General Agreement, VTB Group will provide additional capital to BoM in the amount of about RUB 100 billion. 

VTB Factoring, subsidiary of VTB Bank, has provided factoring services since 2009. Since 2011 VTB Factoring is the market leader across the board. VTB Factoring’s mission is to bring new technological ideas into the sector and ensure financing is both comfortable and available for clients. VTB Factoring has offices in 17 of Russia’s largest cities and reaches out to clients through VTB Bank branches. VTB Factoring is a member of the largest international factoring association, IFGroup, and also of the Russian association of factoring companies. The company’s success is rooted in its client-oriented approach and the ability to adapt products to individual client’s specific needs. Thanks to this approach, VTB Factoring’s client list includes many of Russia’s largest trading and industrial firms. VTB Factoring’s performance in 2013 was impressive: retaining and strengthening VTB Group’s position on the Russian factoring market with a share of about 30%. For two consecutive years, VTB Factoring has been the absolute market leader with a turnover of RUB 2 trillion. 

In 2014, VTB Factoring will face more challenging tasks, such as enhancing our company’s leading positions on the market. Next year, VTB Factoring’s portfolio should exceed the symbolic RUB 100 billion mark, and its turnover should top 500 billion, with its market share set to increase thanks to Russia’s largest companies launching factoring operations.

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