Translated material
Better than analysts
VTB reported for 2007
VTB Group's financial performance for 2007 was better than analysts expected, but not so good as to force investors to buy its shares. Yesterday, VTB quotes were declining - after the publication of the data, investors who were expecting good results and had been buying securities all last week began to sell them, taking profits.This is VTB's first reporting as a public company. As VTB President Andrey Kostin (pictured) said yesterday, last year, according to IFRS standards, the group's profit grew by 28.4%, from $1.179 to $1.514 billion. This is almost 9% higher than the consensus forecast of analysts; they expected profit growth to $1.39 billion. “The fourth quarter turned out to be very successful for VTB,” says Olga Belenkaya, deputy head of the analytical department of Sovlink. -- The growth of assets at the end of the year was 25%. Obviously, in conditions of a liquidity crisis, many companies preferred to work with state banks rather than with commercial credit institutions. This allowed VTB to significantly increase the volume of loans issued and the volume of funds raised for deposits of corporate clients.” Denis Mukhin, an analyst at BCS Investment Company, agrees with this opinion: “State banks were able to take advantage of the situation when, in conditions of a lack of liquidity, clients left other banks.”
VTB Group assets grew by 76.7%, to $92.61 billion, although according to the forecast they should have increased by 57%, to $82.5 billion. The loan portfolio after deducting the impairment provision became twice as large - $58.549 billion ., and the loan portfolio to individuals before deduction of the impairment provision tripled, to $7.682 billion. The group received income of $300 million from one-time transactions, of which VTB earned $167 million through the sale of a five percent stake in the aerospace corporation EADS .
In anticipation of the publication of VTB's financial statements, the bank's stock quotes have been growing since the beginning of April, the price of securities during this time increased by 4.3%, to 9.18 kopecks. Yesterday, investors began to take profits, as a result, the share price fell by 1.36%. “Despite last year's good results, investors are concerned about the latest financial data,” says Mr. Mukhin. “As you know, at the beginning of the year the bank showed a loss, so market participants are now waiting for reports for the first quarter.”
VTB is dissatisfied with the results of the tenders of the Olimpstroy corporation and decided to suspend its participation in these competitions. “We participated in several tenders, but we are not satisfied with their results. In particular, the non-transparent system of organization,” said President Andrei Kostin. “I have instructed my employees to suspend participation in these tenders.” The Olimpstroy State Corporation was created to organize the construction of facilities for the 2014 Winter Olympics in Sochi. 91 competitions for the design of Olympic venues and 39 competitions for selecting investors are planned for 2008.