Välkomna till Swedbank Ukraina
Ingvar Andréasson 2009-03-26
Strategic Rationale for Acquisition
•
Next step to enhance long-term
growth
•
Leverage Swedbank’s experience and
expertise from the Baltics
•
Ukraine is one of the best growth
opportunities in Europe
•
Under-penetrated banking market
•
Swedbank Ukraine is a good fit with its
focus on the retail and SME segments
•
Norway
Sweden Finland
Denmark
Estonia
Latvia
Lithuania
Russia
Ukraine
Highly experienced management team
led by Mr. Tigipko
2
In brief
30 June, 2008
Employees
Number of branches
Private customers
Corporate customers
ATMs
Internet banking customers
Sweden
8 635
436
4.1 million
275 000
863
2.4 million
Baltics
9 242
284
5 million
219 000
1 287
2.6 million
Russia
474
3
Ukraine*
3 481**
190
150 000
19 000
164
Total
21 832
* Acquisition of TAS Kommerzbank was finalized July 9, 2007
** Including 200 employee in Swedbank Invest
31 December, 2007
Total assets, SEKm
Operating profit, SEKm
1 607 984
15 586
Total lending to the public, SEKbn
1 103
Fund investments, SEKbn
421.8
Return on equity, %
18.9
3
Transaction Summary
• Acquisition of 100% of the shares of TAS-Kommerzbank (“TAS”) for
$735 million (SEK 5.2 billion)
– Includes an equity contribution to TAS of $50 million (SEK 353 million)
• Additional performance based payment in 3 years of up to $250
million (SEK 1.8 billion)
• Deal was closed in July 2007
• Mr. Sergiy Tigipko, owner of TAS, remains as CEO
4
TAS: One of Ukraine’s Fastest Growing Banks
• Headquarters in Kiev
• Universal bank with a recognized brand name
• Ukraine’s fourteenth largest bank based on total loans (22nd in 2003)
• Rapidly growing retail and SME franchise
– Current roll-out of new “NICE TAS” strategy targeting the retail market
– Rapid gain of market shares in retail loans (2.3%, #9) and retail
deposits (1.6%, #13)
5
Strong Management Team
•
Mr. Tigipko has been CEO of TASKommerzbank since 2005
•
Mr. Tigipko was a founder and CEO of
Privatbank, the largest Ukrainian bank
•
Mr. Tigipko has also served in public
services:
– Governor of the National Bank of Ukraine
– Minister of Economy
– Vice Prime Minister
•
Members of the Management Board of
Swedbank Ukraine have an average 10
years of banking experience
6
Corporate Governance and Management
•
Swedbank Ukraine is a strategic business segment in Swedbank
•
Chairman of the Supervisory Board of Swedbank Ukraine is Jan Lidén, CEO of
Swedbank
•
Mr. Tigipko will continue as CEO of Swedbank Ukraine
•
Swedbank will support Swedbank Ukraine Management Board with
professionals focused on:
–
–
–
–
–
Financial and business control
Audit
Treasury and funding
Credit and risk
Purchase
7
Swedbank Ukraine: National Coverage
•
Modern and nationwide branch
network
– Presence at 194 sales points in all
regions of Ukraine
Kiev
Latsk
Rovno
Chernigov
Sumy
Zhitomir
Khmelnytsky
Poltava
Branch Development
Lvov
Kharkov
Cherkasy
Ternopol
Lugansk
Vinitsa
Kirovograd
200
194
Donetsk
Uthgorod
Chernovtsi
IvanoFrankovsk
150
Nikolaev
Zaporozhie
Odessa
Kherson
Dnepropetrovsk
95
100
Simferopol
41
50
23
0
2003
2004
2005
2006
8
CONSOLIDATED
Competitors environment
01.08.2008
UAHm
Total Market
Assets share Place
PrivatBank
68 790
9,6%
1
Raiffeisen Bank Aval
51 344
7,2%
2
UkrSibbank (BNP Paribas)
42 359
5,9%
3
Ukrsotsbank (Unicreditbank) 36 670
5,1%
4
Ukreximbank
35 226
4,9%
5
Prominvestbank
27 791
3,9%
6
Nadra Bank
24 036
3,4%
7
Oshchadniy Bank
23 524
3,3%
8
ОTP Bank
22 968
3,2%
9
ALFA-BANK
19 825
2,8%
10
VTB
18 065
2,5%
11
Forum
16 362
2,3%
12
FUIB
15 504
2,2%
13
SWEDBANK FINANCE
15 247
2,1%
14
Brokbusinessbank
15 228
2,1%
15
Finance & Credit
15 119
2,1%
16
Ukrprombank
14 183
2,0%
17
Kreditprombank
13 369
1,9%
18
Ukrgazbank
13 011
1,8%
19
Rodovid Bank
12 410
1,7%
20
01.07.2008
Total Market
Assets share Place
68 019
9,7%
1
48 653
7,0%
2
41 212
5,9%
3
35 901
5,1%
4
34 418
4,9%
5
27 539
3,9%
6
23 761
3,4%
7
23 677
3,4%
8
22 694
3,2%
9
19 219
2,8%
10
16 230
2,3%
12
15 415
2,2%
15
15 449
2,2%
14
14 655
2,1%
16
16 520
2,4%
11
15 763
2,3%
13
13 676
2,0%
17
13 080
1,9%
18
12 175
1,7%
19
11 997
1,7%
20
Deviation from
the last reporting date
Total Market
Assets share Place
771 -0,1%
0
2 692
0,2%
0
1 146
0,0%
0
769
0,0%
0
808
0,0%
0
252 -0,1%
0
275
0,0%
0
-154 -0,1%
0
274
0,0%
0
606
0,0%
0
1 836
0,2%
1
946
0,1%
3
55
0,0%
1
592
0,0%
2
-1 292 -0,2%
-4
-644 -0,1%
-3
507
0,0%
0
289
0,0%
0
836
0,1%
0
413
0,0%
0
01.01.2008
Total Market
Assets share Place
56 211
9,4%
1
44 458
7,4%
2
37 664
6,3%
3
31 227
5,2%
4
28 622
4,8%
5
26 090
4,4%
6
21 260
3,5%
7
19 297
3,2%
8
17 910
3,0%
9
15 094
2,5%
10
11 715
2,0%
17
14 420
2,4%
12
13 897
2,3%
13
12 142
2,0%
15
11 980
2,0%
16
14 634
2,4%
11
11 212
1,9%
18
12 504
2,1%
14
10 314
1,7%
19
9 952
1,7%
20
Deviation from
the beginning of the
year
Total Market
Assets share Place
12 579
0,2%
0
6 886 -0,3%
0
4 695 -0,4%
0
5 444 -0,1%
0
6 603
0,1%
0
1 701 -0,5%
0
2 776 -0,2%
0
4 227
0,1%
0
5 057
0,2%
0
4 731
0,2%
0
6 350
0,6%
6
1 941 -0,1%
0
1 608 -0,2%
0
3 105
0,1%
1
3 248
0,1%
1
484 -0,3%
-5
2 971
0,1%
1
865 -0,2%
-4
2 697
0,1%
0
2 458
0,1%
0
9
Statistics Consolidated – Swedbank Ukraine
Market position (01.08.08)
Number of local branches
Number of ATM:s
Number of bank in stores
Number of telephone customers
Self-service customers
Operator customers
Number of corporate customers
Number of private customers
Number of Internet customers
Corporate customers
Private customers
Cards
Number of bank cards (at the end of period)
Number of quarterly cards transactions
Issued cards (during quarter):
Maestro and Visa Electron
National cards
Visa and Mastercards
Number of purchases (thous)
Internet
Number of payments via internet
Number of fund transactions via internet
01.09.2008
14
194
174
0
4 107
4 107
0
19 131
149 584
0
0
0
382 503
78 149
21 684
20 539
0
1 145
0,050
0
0
10
Ukraine: attractive market characteristics
2nd largest CEE country by population (47 million inhabitants)
Russia
Ukraine
Poland
Uzbekistan
Romania
Kazakstan
Belarus
Czech Rep
Hungary
Bulgaria
143
47
38
27
22
15
10
10
10
7
11
Principal commercial centres
•
Kyiv
2.6 million
•
•
•
•
•
Kharkiv
Donetsk
Dnipropetrovsk
Odesa
Lviv
1.5 million
1.1 million
1.1 million
1.0 million
800.000
12
Ukraine: attractive market characteristics
One of the fastest growing CEE economies
Superior historic economic growth…
…with plenty of room to grow further
GDP per capita. US$ (2005)
Nominal GDP (2000-05 CAGR)
2006:
7.1%
24%
22%
10 910
12 200
21%
18%
17%
7 850
16%
12%
5 340
2006:
1 900 US$
4 270
3 270
1 770
Russia
Ukraine Romania Hungary Cz. Rep Bulgaria
Poland
Ukraine
Bulgaria Romania Russia
Poland Hungary
Cz Rep
13
Macro fundamentals
The dynamics of inflation
The dynamics of GDP
12.1%
12.3%
9.6%
10.3%
11.6%
8.2%
7.1%
8.6%
7.3%
2.6%
2003
2004
2005
2006
9 months of
2007
5.31
5.05
2003
2004
2005
5.05
5.05
2006
2004
2005
2006
9 months of
2007
Rate of exchange at the period end (UAH/EUR)
Rate of exchange at the period end (UAH/USD)
5.33
2003
9 months of
2007
6.66
7.22
5.97
2003
2004
2005
6.65
2006
7.16
9 months of
2007
14
Ukrainian banking market
The fastest growing banking market in CEE
Plenty of room for further growth
Loans per capita in CEE countries
Total loan growth (2000-05 CAGR)
2007 (9 months): 52%
51%
Only c.60% of
bankable population
uses banking
services
46%
31%
12%
Croatia
5 284 5 718
2 371
12%
563
Russia
4 742
29%
14%
Ukraine
13 087
Hungary
Czech
Rep
Poland
Eurozone
911
1 307 1 340
Ukraine Romania Turkey
Russia
Poland Hungary Croatia Cz Rep Eurozone
Favorable political and economic conditions for investments
•
Absence of restrictions for foreign shareholding in Ukrainian banking system
•
Absence of problems with approval of Ukrainian banks recent purchases by foreign investors
•
Political support of foreign investments in Ukrainian banks at government and NBU
•
Strategic interest for foreign investors
15
Ukraine to Follow CEE Development
• Transitional economy with similar structure and potential
as CEE in early 2000
High Growth Potential
2005
2000
Retail Loans / GDP (%)
30%
Slovakia
25%
Poland
Hungary
Estonia
Czech R.
Latvia
20%
Lithuania
15%
Czech R.
Ukraine
10%
Estonia
Poland
Latvia
5%
Lithuania
Hungary
Slovakia
0%
0
2 000
4 000
6 000
8 000
(USD)
GDP / Capita
2000
Source: EIU, Global Insights World Overview, broker reports
10 000
12 000
2005
16
Våra banktjänster i Ukraina
•
•
•
•
•
•
•
•
•
•
•
Konton samt placeringskonton
Finansiering och garantier
Rörelsekrediter
Factoring
Leasing
Nationella och internationella betalningar
Elektroniska Banktjänster
Kort
FX
Valutakontroll
Rådgivning
17
Re-branding started
• Экстерьер
Kulturella skillnader
1. Jobb
1. Jobb
1. Jobb
2. Rekreation
2. Familj
2. Utbildning
3. Utbildning
3. Utbildning
3. Familj
1. Rekreation
1. Fritid
1. Välgörenhet
2. Hem
2. Rekreation
2. Utbildning
3. Välgörenhet
3. Underhållning
3. Fritid
Source: Research by Berlin Centre of Social Studies and Dublin Institute of Economic and Social Studies
19
20
Förväntad medellivslängd vid födelsen inom EU + några Östländer
Män
Kvinnor
1. Sverige
77,4 år
1. Frankrike
83,1 år
2. Italien
76,0 år
2. Italien
82,4 år
3. Grekland
75,4 år
3. Spanien
82,3 år
3. Holland
75,4 år
4. Sverige
82,0 år
3. Spanien
75,4 år
5. Österrike
81,4 år
6. Frankrike
75,2 år
6. Holland
81,0 år
7. Österrike
74,9 år
7. Belgien
80,9 år
8. Storbritannien
74,8 år
8. Finland
80,9 år
9. Belgien
74,6 år
9. Luxemburg
80,8 år
10. Tyskland
74,3 år
10. Grekland
80,8 år
87. Litauen
69,5 år
Litauen
79,7 år
112. Estland
66,9 år
Estland
78,0 år
120. Lettland
66,4 år
Lettland
77,1 år
148. Ukraina
62,2 år
Ukraina
75,0 år
157. Ryssland
59,1 år
Ryssland
73,0 år
21
Ukrainian market
Direct foreign investment in Ukraine1)
2005-10-01
Volume of direct
investment as of
01.10.2005 (mln.
USD)
Total
In % to the total
9 532
100
Cyprus
1 457
15
United States of America
1 225
13
United Kingdom
1 047
11
Virgin Islands (British)
709
7
Germany
628
7
The Netherlands
589
6
Russian Federation
556
6
Switzerland
428
5
Austria
351
4
Poland
215
2
Hungary
194
2
Korea, Republic of
172
2
1 964
21
of which,
Other countries
23
Direct foreign investment in Ukraine1)
2006-10-01
Volume of direct
investment as of
01.10.2006
(mln.USD) 2)
Total
In % to the total
19 912
100
Germany
5 701
29
Cyprus
2 186
11
Austria
1 659
8
United Kingdom
1 520
8
United States of America
1 400
7
The Netherlands
1 364
7
Russian Federation
925
5
Virgin Islands, British
787
4
France
763
4
Switzerland
430
2
Poland
331
2
Hungary
240
1
2 606
13
of which
Other countries
24
Direct foreign investment in Ukraine1)
2007-07-01
Volume of direct
investment as of
01.07.2007
(mln.USD) 2)
In % to the total
24 172
100
Germany
5 678
24
Cyprus
4 130
17
Austria
1 957
8
The Netherlands
1 864
8
United Kingdom
1 797
7
United States of America
1 381
6
Russian Federation
1 236
5
France
935
4
Virgin Islands, British
813
3
Switzerland
581
2
Poland
483
2
Hungary
361
2
2 956
12
Total
of which
Other countries
25
Direct foreign investment in Ukraine1)
2007-10-01
Volume of direct
investment as of
01.10.2007
(mln.USD)2
Total
In % to the total
26 857
100
Germany
5 759
21
Cyprus
4 958
19
The Netherlands
2 174
8
Austria
2 011
8
United Kingdom
1 820
7
United States of America
1 421
5
Russian Federation
1 343
5
France
1 026
4
Virgin Islands, British
943
4
Sweden (10:e plats!)
877
3
Poland
640
2
Switzerland
580
2
Hungary
393
2
2 913
11
of which
Other countries
26
Big Mac Index
Big Mac index i SEK
40
35
30
Sverige
38,00
Lettland
22,30
Estland
22,50
Litauen
20,20
Polen
22,00
Ryssland
16,20
Ukraina
13,00
25
Pris
20
15
10
5
Enhet - SEK
ain
a
Uk
r
an
d
sl
n
Ry
s
Po
le
ta
ue
n
Li
d
lan
Es
t
ttl
Le
Sv
e
rig
e
an
d
0
27
Källa: Economist 2008
AFFÄRSKULTUR UKRAINA
• Ukrainare är traditionella – kom välklädd
• Kort planeringshorisont
• Stressa inte – förhandlingar tar tid
• Bara skriftliga avtal gäller
• Viktigt med språk – få engelsktalande (men det blir fler)
• Mycket hierarkisk och auktoritär ledarstil
• Viktigt med bra kontakter – speciellt med myndigheter
• Goda nyheter / dåliga nyheter
28
Källa: Exportrådet Ukraina
BARRIÄRER
• Språk
• Korruption
• Bristande infrastruktur utanför städerna
• Ibland ett svårförståeligt juridiskt system
• Svårt med deadlines
29
CPI - Corruption Perception Index 2007
1
Denmark
1
Finland
1
New Zealand
4
Singapore
4
Sweden
6
Iceland
28
Estonia
51
Latvia
51
Lithuania
118
Ukraine
143
Russia
179
Somalia
30
MÖJLIGHETER UKRAINA
• Snabb utveckling av den inhemska marknaden
• Ökad köpkraft driver den ekonomiska utvecklingen i Ukraina
• Svenska produkter kända för god kvalitet (men också högt pris)
• Attraktivt för arbetskraftsintensiv produktion
• Svag konkurrens inom flera branscher
• Logistik och distributionsnätverk förbättras
• Ukraina blev medlem i WTO 2008
• Förhandlingar om frihandelsavtal EU/Ukraina har påbörjats 2008
Källa: exportrådet
31
Några svenska företag i Ukraina
AIRO Catering Services
ALFA LAVAL
ASEA BROWN BOVERI LTD
ASTRA ZENEKA
ATLAS COPCO
AVIS RENT A CAR UKRAINE
BORYSPIL CEREAL PLANT (Cerealia)
BT-UKRAINE (mechanical handling consultant)
CETAB
CHUMAK
DANFOSS
Danzas Eurocargo ´(f d ASG)
DE LAVAL
DNIPROKYSEN (AGA AB)
ELO (ECOLEAN)
ENO (IKEA)
ERICSSON UKRAINE
FOSS TECATOR
GAMBRAMED
HANDELSHUSET DETTWILER/HOUSE OF ISLE
IMI-INTENATIONAL (Tour & Andersson Hydronics)
ITT FLYGT AB
LINDAB AB
MAP Ukraine (fd MODO GROUP)
NORDIC SATELLITE AB
NOVARTIS
ORIFLAME
PROF SYSTEMS (ELECTROLUX)
PROSA LTD (IKEA)
SANDVIK INTERNATIONAL AB
SCANDI-official distributer of TARKETT
SCANIA CV AB
SCHENKER BTL
SKANSKA EAST EUROPE OY
SKF EUROTRADE AB
SKF-Lutsk Bearing Plant
SOCTRADE
STEN LTD (IKEA)
SVEDALA UKRAINE
SWEDBANK
TELEMEDIA UKRAINE-daughter company of TELIA
TETRA LAVAL UKRAINE
TREMIX AB
VIKING MOTORS-VOLVO
VOLVO TRUCK CORPORATION
Ytrans Ukraine Ltd
ÅKERLUND&RAUSING
32
Källa: Exportrådet
Ukraine – overview
Political landscape – positive factors:
 Democracy is entrenched; freedom of press established; civil society & its attributes
developing.
 There is wide national consensus – politically & geographically – to join the EU.
 Ukraine joined WTO in May; will start negotiations with EU in the fall.
 Business continues to grow & expand, disregarding political friction at national level.
 Prime Minister Tymoshenko is intent on combating corruption and attracting FDI.
 Population is united around strategic national and security issues, notwithstanding
political affiliations and language preferences.
33
Ukraine – overview
Political landscape – negative factors:
 Ongoing political friction between PM Tymoshenko and President Yushchenko are
destabilizing fiscal, monetary, legislative & reform agendas, and scaring FDI.
 Current parliamentary majority is in a fragile state because coalition partners
mistrust each other.
 Leaders of all major political parties are more focused on personal /business/ party
interests than national interests.
 Shadow economy – still major problem and shrinking, albeit slowly.
34
Business Environment
Inflation
• The index of inflation from the beginning 2008 is 14,8 %.
• The World Bank increased the inflation forecast for 2008 from 17,2% to 21,5%.
• S&P predicts an inflation index for 2008 at 27%.
NBU
• The National Bank of Ukraine continues to apply restrictive measures in the form of
increase in provisions under unsecured credits, credits to private persons etc.
Banking system
•
•
The Ukrainian banks began the new business season with rather low indicators:
corporate credits have grown with 23,16 % from the beginning of the year (for 2007
the growth of 62,9 %), loans to private clients have increased with 23,16 %
(increase in 2007 was 97,8 %),
The majority of banks (except some big banks and banks with foreign capital)
continue to have deficiency of resources, first of all in UAH.
35
Short summary about economic development of Ukraine
(January – June 2008)
The gross domestic product (GDP) has increased by 6.3% compared to the similar period of Y2007.
Agriculture: production volume has increased by 10,9% during 7 months 2008 compared to similar period
of Y2007. Agricultural companies +20.1%, private farms +3,1%.
Industry: the total production has increased by 5.2% in June 2008 compared to June 2007, and has
increased by +7.5% according to half year 2008 results. All industries except oil refining have increased
production volumes.
Construction: the volume of construction works decreased at 1,2% during January – June 2008 compared
to the same period of Y2007.
Transport: 462,9 mio tons of cargoes and 4.2 billion passengers were transported in January – June 2008
that is +7,6% and +3,3% more than in the same period of the Y2007.
Foreign trade: The volume of export was USD 25,646.0 mio (+35.8% compared to the same period 2007)
and import USD 34,452.4 mio (increase by 1.5 times accordingly).
Wholesale trade: The total turnover of wholesale trade companies was UAH 571,3 billion in January –
June 2008. Goods turnover has increased by 4.8% compared to the similar period of Y2007.
Retail trade: The total retail turnover was UAH 241,6 billion, that is 26.6% increase compared to the similar
period of Y2007.
36
Swedbank-Finance
History of Swedbank-Finance
History of Swedbank
1991
TAS Kommerzbank established under the name of Bank Intellect
1996
Bank Intellect becomes a subsidiary of Privatbank and is renamed into Bank Kyiv-Privat
2001
Bank Kyiv-Privat passes under control of TAS-Group
2007
100% of equity was purchased by Swedbank AB
2007
Decision about making of banking holding group Swedbank-Finance and renaming of TASKommerzbank into Swedbank
History of Swedbank-Invest
1996
2001
2005-06
2007
Established as Societe Generale Ukraine
Bank passes under control of TAS-Group
100% of equity was acquired by TAS Kommerzbank
Decision about renaming of TAS-Investbank into Swedbank-Invest
38
Ownership structure
100%
Swedbank
100%
Banking holding group
Swedbank-Finance
Swedbank-Invest
39
Highlights
Key financials and
statistics(30/09/07)
US$m
Total assets
1 760
Customer loans
1 438
Customer deposits
714
Market shares(30/09/07)
Shareholders equity
192
Place by total assets
16
Market share
1.9%
Place by corporate loans
16
Market share
1.8%
Net profit
Outlets
FTE
Corporate clients
Private clients
11.2
191
3 301
17 311
163 500
Place by loans to individuals
9
Market share
2.3%
40
Swedbank-Finance: strengths
Strategic initiatives
In banking for individuals
•
•
•
Strategy NICE developed and implemented
with the support of Deloitte (Poland)
Focus on providing cash loans to mass
segment through new outlets and
supported by strong national wide
promotional campaign
Providing of mortgage loans through new
outlets. supported by strong national wide
promotional campaign
Leader in attractive niches
Financing of new projects
•
Swedbank-Invest - recognised leader in
arranging bespoke financial solutions for
new projects
Strong nationwide distribution
•
•
191 outlets covering all the regions of
Ukraine
Including 84 outlets opened since later
2006 in course of implementation of
new retail strategy
Factoring
•
•
Founder of the Ukrainian factoring market
Dominant position on the market
Lutzk
•
Latsk
Lutzk
Rouno•
Chernigov
•
Chernigov
Rouno
Rovno
Sumy
Lvov
•
In corporate banking
•
•
•
Strategy BEST developed with the support
of Deloitte (Poland)
Focus on mid-sized companies and SME,
network and sale staff reorganization
Financing of new projects proposed by
Swedbank-Invest
The fastest advancing player in the trade
finance segment
Kiev
•
Zhitomir
Kiev
Poltava
•
Trade finance
•
Zhitomir
•
Lvov
Ternopol
•
Uthgorod
•
•
•
Frankovsk
•
Uthgorod
Khmelnytsky
Ternopol
•
IvanoFrankovsk
Khmelnytsky
Vinitsa•
Poltava
Kharkov
•
Cherkasy
•
Vinitsa
Lugansk
Kirovograd
Dnepropetrovsk
Chernovtsi
•
Kharkov
Cherkasy
Donetsk
•
Chernovtsi
Donetsk
Zaporozhie
•
Consumer lending
•
One of the leaders in cash loans offering
Odessa
•
Odessa
Nikolaev
Nikolaev
Kherson
•
Kherson
Simferopol
Entering international borrowing market
•
During 1.5 year borrowings reached 174
US$m
41
Clients
Customer focus
Swedbank
Swedbank-Invest
Retail
HNWI
SMEs and mid-size corporate clients
Mid-size and large corporate clients
Market counterparties
Loans & deposits by bank (30/09/07) US$m
1 438
Loans & deposits by customer (30/09/07) US$m
1 438
28%
714
72%
Loans
33%
Sw edbankInvest
Sw edbank
41%
714
50%
67%
59%
Deposits
Loans
Individuals
Corporates
50%
Deposits
42
Key financials development
Retail loans & deposits
Corporate loans & deposits
Retail loans, US$m
588
Corporate loans, US$m
Corporate deposits, US$m
Retail deposits, US$m
342
357
337
850
519
350
107
154
Dec-05
Dec-06
Sep-07
Shareholders equity & total assets
Dec-05
1760
Sep-07
Normalised: Reported
less negative goodwill
11,2
10,8%
1001
553
Dec-05
Dec-06
Net profit & ROE
Shareholders equity, US$m
Total assets, US$m
82
357
328
262
131
Dec-06
10,2%
6,6
7,0
2005
2006
6,6%
192
Sep-07
9m-2007
43
Strategy overview
Top 7 Ukrainian banking institution by 2011 by total assets
(market share of 4.9%)
Our goal:
Corporate Banking
Retail Banking
SME banking
Large corporate banking
Growth
•Aggressive expansion for leadership
•Focus on profitable growth
Client focus
• Mass retail (middle & lower middle income)
• Micro businesses (annual turnover
<$200US$k)
•Small & medium-sized businesses
(annual turnover 200US$k – 15US$m)
Product focus
•
•
•
•
•
•
•
•
Distribution
• >500 “NICE” branches
• “BEST” branches
• regional corporate centres
• HQ supported by regional corporate centres
Key initiatives
•
•
•
•
• Conversion of existing network
• New product development
• Appointment of regional RMs
• Attraction of longer and cheaper funding from
international markets
• Establishment of a dedicated team of large
corporate RMs in the HQ
Cash loans and credit cards
Mortgages
Current accounts with overdraft
Time deposits
New network expansion
Call-Centre and Internet-banking
Centralisation & automation
National brand-building campaign
SME lending
Payments & cash management
Deposit taking
Other specially designed SME products
•Selective targeting focused on profit
•Large companies and “blue chips”
turnover >15 US$m)
(annual
•Financing of new projects proposed by
leader in this field - Swedbank-Invest
•Trade finance
•Fee-based products. i.e. securities
underwriting
Experienced management team
44
Financial forecast highlights
Corporate loans & deposits
Retail loans & deposits
Target market share:
Target market share:
Retail loans, US$m
Loans – 5.9%
Retail deposits, US$m
Deposits – 4.2%
854
342 337
Dec-06
2450
1 216
984
901
1613
975
519
582
Dec-07 budget
Dec-08 forecast Dec-09 forecast Dec-10 forecast
Shareholders equity & total assets
Dec-06
Dec-07 budget
756
578
455
328
Dec-08 forecast Dec-09 forecast
Dec-10 forecast
Net profit & ROE
Target ROE – 20%
Target market share:
Shareholders equity, US$m
Total assets, US$m
2 392
1 691
2 756
1 673
Loans – 3.2%
Corporate loans, US$m
Corporate deposits, US$m Deposits – 3.0%
4 302
Total assets – 4.9%
7427
Net profit, US$m
ROE
18,9%
20,0% 150,9
16,7%
4985
90,6
12,8%
3275
47,8
2020
1001
131
Dec-06
204
Dec-07 budget
368
593
Dec-08 forecast Dec-09 forecast
915
7,0%
21,5
6,6
Dec-10 forecast
2006
2007 budget
2008 forecast
2009 forecast
2010 forecast
45
Conclusion
• Next step to enhance long-term growth
• Leverage Swedbank’s experience and expertise from the Baltics
• Ukraine is one of the best growth opportunities in Europe
• Under-penetrated banking market
• TAS is a good fit with its focus on the retail and SME segments
• Highly experienced management team led by Mr. Tigipko
46
Ukrainian banking market
Foreign banks enter the market
Portion of banks with foreign shareholders in total number of banks. %
44 foreign banks, including
25%
CitiBank
21%
ING
BNP Paribas
14%
12%
12%
Raiffeisen Bank
2003
2004
2005
2006
9/30/2007
Portion of banks with foreign shareholders in share capital of sector. %
35%
Swedbank
20%
10%
2003
2004
OTP Bank
Alfa Bank
28%
11%
UniCredit
SEB
have entered Ukrainian market
2005
2006
9/30/2007
48
Ukrainian banking market
Number of banks at 30/09/07: 196
Shareholders equity of Ukrainian banks. US$b
Total assets of Ukrainian banks. US$b
EU - 280%
Total assets
100%
Total assets/GDP
Shareholders equity
30%
14
120
29%
100.7
90%
Capital adequacy
11.5
28%
12
27%
100
26%
25%
80%
69.9
70%
86%
10
8.4
24%
80
23%
22%
8
21%
20%
60%
60
44.2
66%
5
19%
18%
40%
19.8
26.7
17%
40
16%
50%
15%
2.4
14%
20
30%
37%
39%
13%
12%
6
3.5
50%
4
16.8%
15.1%
15.0%
14.9%
11%
20%
0
2003
2004
2005
2006
9/30/2007
2
13.9%
10%
0
2003
2004
2005
2006
9/30/2007
Key trends of Ukrainian banking market
•
•
•
•
•
Increase of foreign capital presence
Active development of outlets and product offering for retail clients
Syndicated loans and eurobonds issues
Development of cooperation with insurance companies and other non-banking partners
Capital adequacy - 10%
49
Ukrainian banking market
Loans to private clients. US$b
Loans to corporate clients. US$b
65%
133%
2.8
2003
2004
2005
2006
9/30/2007
21.6
2003
2005
32% 27.7
21
59%
14.4
43%
30% 7.8
6
2004
5.3
2005
9/30/2007
2006
9/30/2007
Key trends:
• Deposits increase as a result of growing personal income
• Increasing demand from middle class for mortgages and
loans for buying car
• Electronic banking is offered by the most of banks
• Banks are offering bank assurance products
37% 20.8
26%
85%
2003
2006
Deposits from corporate clients. US$b
Deposits from private clients. US$b
46%
26%
13.7
10.9
2004
44% 47.9
33.2
58%
6.6
1.7
54%
15.4
136%
65%
25.3
2003
15.2
12.1
7.6
2004
2005
2006
9/30/2007
Key trends:
• Strong price competition for large companies and
decrease of interest rates for loans to them
• Great demand of companies for long-term loans and
investments
50
Välkomna till Ukraina!
Ingvar Andréasson