| The Russian subsidiary of Citigroup began issuing loans to Russians Citibank yesterday launched its first project for lending to individuals. The conditions he proposed were unsecured loans from 32 thousand to 320 thousand rubles. for a period of one and a half to three years at 22% per annum, as well as the fundamental reluctance to lend to clients in foreign currency, surprised experts. They believe that Citibank continues to focus on the wealthiest part of the Moscow market and is not yet interested in mass distribution of retail products.
Since November last year, Citibank began providing services to individuals in Moscow - it opened a retail branch on Paveletskaya Square, installed the first ATMs (there will be 46 by the end of the year), and then entered into an agreement with British Petroleum to equip this company's gas stations with its own mini-offices . Like other “subsidiaries” of the largest foreign banks in Moscow, Citibank proclaimed the principle of its work to be “proven” of the client’s income, while establishing a minimum deposit amount of 3 thousand dollars.
By applying for a loan at Citibank, an individual automatically becomes its client (the amount is transferred to a bank account, and a Visa Electron card is issued for the client). But for this he needs to have a Moscow residence permit and a monthly income of at least 16 thousand rubles, confirmed by a certificate of income (form No. 2) from his place of work. The loan application is reviewed by the bank within a week, but, according to analysts, even an accelerated risk assessment system does not compensate for the strict loan conditions.
According to the head of the banking department of RA Interfax, Mikhail Matovnikov, the rate of 22% per annum is clearly higher than the “market”, especially for a bank that attracts private deposits at 1.9-5%. “Russian banks are focusing on the largest player in this segment - Sberbank,” the expert notes, “and it keeps rates at 17-20%.” In the absence of a retail client base, Mr. Matovnikov believes that Citi is not yet interested in a large number of loans and wants to test the risk management system.
Citibank's manager for credit products, Elena Poznykhova, emphasized to the Vremya Novostei newspaper that the loan terms and rate are “adequate and not experimental.” “We will monitor the movement of rates, and if they go down, we can make loans cheaper,” she added. And Vice President of Renaissance Capital Investment Company Richard Hainsworth draws attention to the fact that when assessing lending conditions at Citibank, it is necessary to take into account the absence of a commission rate for this service: “high commissions are not uncommon for Russian banks, they make the day significantly more expensive.”
Nevertheless, Citi’s key client base, according to Troika Dialog senior analyst Andrei Ivanov, remains a small percentage of the Moscow market. “There are not many people in Moscow yet who can be given $10,000 for two or three years without significant risk for the bank,” says the analyst. “Citibank adheres to a strict interest rate policy, skimming the “cream” from the not yet developed segment.” In this case, however, the bank will issue loans only in rubles. “This is a matter of principle, not balance,” Nandan Mer, head of Citibank’s retail banking department, explained yesterday. “The ruble is the currency of this country, our clients receive income in rubles.” Yuri VERETENNIKOV |
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