Translated material
VTB: The end of "Folk IPO"
In early February, Vladimir Putin announced the need for such an operation. As a result, about 105 thousand shareholders can part with their securities. Why do they need it, who and how much will pay for Buy-Back?
The New Times listened to the points of view of one of the leaders of VTB, a minority shareholder
and independent financial analyst
What is the interest in the Buy-Back procedure on the part of shareholders?
Traditionally, our individuals relate to the process of buying shares rather as investing in a bank (which should be guaranteed to make a profit) than as a risky investment operation. And those who replenished the ranks of our shareholders during the 2007 folk IPO collided. Then they bought a stock for 13.6 kopecks, now it costs about 7 kopecks. People want to return their money. Since I took my current position in June 2011, I periodically have to meet with our minority shareholders. And from the first meeting, they raise the question of the Buy-Back procedure.
And what pronounced the bank to agree to this procedure?
The position of our main shareholder is the state. 75.5% of VTB shares belong to the government. In early February, his head Vladimir Putin unequivocally spoke out for carrying out the reverse redemption procedure. This decision, in my opinion, should positively affect the development of the market. It will calm people, demonstrate to them that in our stock market they do not lose money. Yes, of course, there is a problem: from private property, these shares are again under state control. But in the long run after such a maneuver, it will be easier to attract a private investor to the market. And this is vital for the "deepening" of the stock market in Russia. 
Buy-Back as such is a regular practice, periodically happening in the business of different companies. The redemption of papers in minorityans is practiced, for example, when the main owner (or his competitor) wanted to increase his share of property in the company. In our case, the scale is unusual: now we are talking about the redemption of shares from hundreds of thousands of people.
Is it possible about the scale in more detail?
The list of our shareholders today is 114 thousand individuals, participants in the 2007 IPO. Of these, 105 thousand purchased these packages worth less than 500 thousand rubles, that is, they can sell their packages completely. Accordingly, we expect to get 105 thousand applications. Although personally, I think that not all minoritylarities will go to Buy-Back: someone will probably decide that the shares have potential for further growth, and will not rush to “drop” them-they will wait until they are more than we offer now.
How fair is it to redeem the shares at the price at which they were sold in 2007? After all, those 13.6 kopecks and today's “weigh” in different ways: since then, the total inflation in the country has grown, according to official figures, by almost 60%...
Legally, I'm not ready to answer this question. But in fact - we did everything to fulfill the wishes that the minority shareholders expressed.
Judging by the figures you have given, 9 thousand shareholders remain, whose packages exceed 500 thousand rubles. Are you not afraid of lawsuits on their part that their property rights were infringed?
According to all the lawyers with whom we consulted, it will be difficult for shareholders to make some complaints: after all, the conditions that we have announced are equal to everyone. Those shareholders you ask about are not excluded from the Buy-Back procedure: they can also sell their shares, but in the amount of up to 500 thousand rubles. This limit is applicable to everyone, without exception, which, it seems to me, puts everyone in equal conditions.
Which company will be ransomed by shares?
So far it is not determined for sure. It is only known that this will be one of our “daughters” - this is the requirement of the law on joint -stock companies. Well, the agent will be our VTB24 retail bank: he has a wide network, it is convenient to collect applications, then verify them, check the legal compliance.
How much will the ransom of shares cost the bank?
At 16 billion rubles. The company that will redeem them will receive the appropriate loan from VTB with a maturity. And the repayment itself, obviously, will already be carried out at the expense of these shares. In accordance with international financial reporting standards (IFRS), this money is not on the profit of the bank, but for capital. The reduction in capital will be very small and does not cause a threat of non-fulfillment of any banking standards.
What explains the fact that from the time of the “People’s IPO” the price of the VTB share has almost doubled - the influence of the global crisis? Or is the responsibility lies on the bank's management?
It is incorrect on my part to evaluate management activities at that time-today I participate in decision-making decisions. In general, the fall of the fall of our shares corresponds to the general dynamics of the Russian stock market. In 2009, the cost of the share fell to the level of 2.33 kopecks. Now it is growing, although the 2007 pre -crisis peaks are still far away.
Prime Minister Putin is now leading a presidential campaign. Is it possible that, having announced the Buy-Back procedure, he thereby wanted to attract another 105 thousand supporters from among VTB shareholders? ..
The country is now so electrified by the political atmosphere that there are no more decisions of the authorities that would not be regarded as political. And someone already reproaches us that we do not buy the shares until March 4 in order to force people to vote for a certain candidate. But this is absurd! How can we force someone to vote in a certain way? We do not give out money in exchange for filled ballots. We simply do not have time to carry out all the preparatory procedures for such a large-scale action as Buy-Back, until mid-March.
Conditions for the return ransom of shares of VTB Bank for Participants in the "People's IPO"
• Minority) will be able to apply for compensation (both individuals and legal entities) who bought papers during the placement in 2007 and retained them until February 2012 • shares will be purchased at the price of placement - 13.6 kopecks. apiece - from the own funds of the VTB group. • During the redemption process, a restriction on the amount of compensation is introduced: up to 500 thousand rubles. • The shares will be purchased by one of the subsidiaries of VTB group, the agent will be the retail network of the bank - VTB24. • The timing of the reverse ransom has been pre -determined from mid -March to the beginning of May 2012.
My attitude to the opposite ransom of VTB shares is positive, because those shareholders who are Russian citizens receive additional opportunities. Before that, we were doomed to just sit and wait until the price of shares grows to the level that suits us. For almost five years since the “People’s IPO”, the price of shares of the bank fell with 13.6 kopecks. up to 7 kopecks. Now the shareholders have the opportunity to sell shares at the price at which they were purchased in 2007. Of course, this does not cover the missed benefit that would be obtained if the money were placed in the bank for deposits, but at least covers the real losses resulting from an almost two -time price of price. I will explain with an example. In 2007, I bought stocks, suppose, 100 rubles. If I then just put this money in the bank at a percentage, by today they would have turned into 150 rubles. And in shares due to a two-time fall in the course, they turned into 50 rubles. That is, I lost 100 rubles, of which 50 rubles are real losses, and another 50 rubles - lost benefit. But the decision on the reverse redemption allows me to sell my shares for 100 rubles. So, my losses are reduced by 50 rubles. If so, then I - for the reverse ransom.
However, the Buy-Back procedure opens another opportunity, which I personally would like to use. I can legally sell my, relatively speaking, 200 shares of 13.6 kopecks apiece. And then, for the proceeds on the money market, to buy VTB shares again, but already at their current market price - about 7 kopecks. So, for the same money, I will become the owner of 400 shares.
I think about 80% of all minority shareholders will go to the Buy-Back procedure. 20% of the remaining are those who, for some reason, do not follow financial news and are not in the know of what is happening, or those who consciously decided to play long and are ready to wait for many years.
I am an economist, not a political scientist, in order to build any assumptions on the account of political motivation for a decision on the reverse redemption of VTB shares. I can only say for myself: it will not affect my choice on the day of March 4 - I am quite informed about what is happening in the country in order to make strategic decisions about the future on the basis of a particular case.
The return ransom of shares is a phenomenon in the stock market, including Russian, widespread. But the discriminatory reverse ransom, which applies only to a certain group of shareholders (those who participated in the “folk IPO”), this is a unique NOU-HAU VTB.
In fact, to exhibit the election offer * * The official proposal for the completion of the transaction containing the terms of the upcoming contract, the discriminatory part of the shareholders, is illegally, the proposal for the reverse redemption should be sent to all shareholders, without exception. However, if it is impossible, but I really want to, then it is possible: the offer to the “folk” shareholders will not expose VTB, but its subsidiary.
However, the legal structure of the reverse ransom, despite all the tricks of the developers, remains a shack, and it is possible that the claims of dissatisfied shareholders in the near future will be checked in the near future. Typically, the return ransom is used to support the price of shares or to counteract hostile absorption. There may be smaller goals: for example, Buy-Back can be carried out with the aim of transferring the purchased shares of the company or getting rid of excess liquidity. It is unlikely that in the conditions of a liquidity deficit that has now developed in the financial market, the chests are breaking out of extra money at VTB.
However, losing 16 billion rubles, VTB simultaneously gets rid of 114 thousand offended minoritarians, the most active of which annually turn the Hall of annual meetings of VTB shareholders into a “torture chamber” for top managers.
There can be no question of any opposition to hostile absorption of VTB - 75.5% of the shares of this bank belong to the Government of the Russian Federation. With such an owner, no "enemies" are terrible.
The return ransom will not raise the price of VTB shares - on the contrary, it helps to reduce it. At least three reasons.
The first - the ransom will reduce the capital of the VTB group by about 8 billion rubles, since the shares are bought with a loss - twice as expensive as the market price. True, under the capital of VTB of 600 billion rubles (IFRS), the influence of this factor on the bank’s shares is not significant.
The second reason for the probable reduction in the price of the bank’s shares is that the ransom infringes on the interests of other minoritarians, thereby clearly demonstrating the low level of corporate culture and negatively affecting the IBB image. What, in essence, is a shareholder, who bought the bank’s shares the next day after the completion of the IPO for 14 kopecks, differs from the IPO participant? And why does an IPO participant, who sold his shares for 3 kopecks at the height of the crisis, does not deserve compensation?
The third reason - VTB once again showed himself as a humble performer of the will of the government, ready to comply with any orders contrary to economic benefit. They said to capture the Bank of Moscow - captured. They said to give a loan to the Lanta-Tour ruin tour operator-Dali. They said to redeem the shares from the "people's iPioners" - they allocated 16 billion rubles. What order will follow-to allocate a hundred or two billions of rubles for the Olympics in Sochi? It is not surprising that the investors of the political risks of VTB has increased many times. VTB is rid of not only liquidity and shareholders. He also gets rid of reputation.
But maybe the authorities hope that all 114 thousand “iPioners” as one will give their vote in the elections for who follows? If so, then the price of each voice as a result of this bunch will be truly gold. Having divided 8 billion rubles (a loss from a ransom) by 114 thousand people, we get about 70 thousand rubles per person. Is it too expensive? Alcoholics willingly sell their votes by the bottle.
For unprofessional investors, the stock market is a casino. It is difficult to imagine a situation when all the loser players of the casino undertake to compensate for their loss. But, in essence, it is precisely so strange, especially for bankers, philanthropy, we observe the VTB shares market. And the only reasonable explanation of this action is one thing - pre -election populism.