VTB Bank (Russian: ПАО Банк ВТБ, lit. 'PJSC Bank VTB'; formerly known as Vneshtorgbank, Внешторгбанк, lit. 'International Trade Bank') is a Russian majority state-owned bank headquartered in various federal districts of Russia;[3][4] its legal address is registered in St. Petersburg;[3] as of 2022, the company's capital stock was mostly owned by three Russian agencies.[5]
VTB Bank and its subsidiaries form a leading Russian financial group – VTB Group uniting VTB banks located in different countries and offering a wide range of corporate banking services and products in Russia, CIS, Europe, Asia, Africa, and the U.S.[6][7][8]
VTB was ranked 446th on the FT Global 500 2012,[9] The Financial Times’ annual snapshot of the world's largest companies. It climbed to 210th in the ranking of the 500 largest companies in Europe, the FT Europe 500 2014,[10] and to 127th in the FT Emerging 500 2014, the list of the 500 largest companies in the world's emerging markets. VTB Bank (PJSC) has 22 branches and 3 representative offices in 13 regions of Russia and 4 foreign countries.[11]
Historyedit
VTB Bank was founded as Vneshtorgbank in 1990 with the support of the Russian State Bank and the Ministry of Finance. It was set up as a limited liability company with the aim of servicing Russia's foreign trade operations and promoting Russia's integration into the global economy.[12]
In 2004, the bank acquired a majority stake of 85.8% in Guta Bank, which was reorganised into a retail bank, Vneshtorgbank 24 (VTB24).[13] The bank also acquired the Armenian Armsberbank, which was later renamed VTB Armenia.[14] In 2005, the bank acquired 75% plus three shares of the Promstroybank (PSB), which was reorganised as Bank VTB North-West and later became VTB's North-Western Regional Centre,[15] and bought the Ukrainian bank Mriya, which was later merged with VTB Bank (Ukraine).[citation needed]
In 2007, the bank set up a subsidiary in Angola known as VTB África.[16] The bank also took over Slavneftebank in Belarus and later renamed it VTB Belarus.[17] In June, VTB became the first Russian bank to offer an initial public offering (IPO), raising $8 billion in what became the largest international banking IPO at the time.[18]
In 2008, the bank acquired a 51% stake in AF Bank in Azerbaijan from AF Holding International, later renaming it VTB Azerbaijan.[19] In 2010, the bank's board approved the phased acquisition of TransCreditBank from Russian Railways.[20] In 2013, VTB carried out a secondary public offering (SPO) which raised 102.5 billion rubles ($3.3 billion) and diluted the Russian government's share in VTB from 75.5 percent to 60.9 percent.[21] In 2022, VTB Bank extended a 630 billion ruble ($11.06 billion) credit line to be used for the purchase, repair and modernisation of the country's railway infrastructure.[22]
In 2011, VTB invested more than $191 million for shares in the Isle of Man company DST Investment 3[23] which was roughly than half of the funds in Yuri Milner's DST Global.[24] This led to Milner's large stake in Twitter.[24][23] Kanton had almost no investment in Twitter.[24] DST Investment 3 also issued shares to Alisher Usmanov's Kanton that were used to support the Kremlin's investment in Facebook.[24]
On 7 May 2014, VTB transferred most of its DST Investment 3 to Kanton.[24][25]
Since 2014, the bank has been subject to political sanctions (see separate section below).
In August 2018, it was announced that VTB Bank would acquire a 75% stake in Vozrozhdenie Bank after its previous owners oversaw a "major banking collapse".[27]
In November 2018, the National Bank of Ukraine declared the Ukrainian subsidiary of VTB Bank insolvent due to its declining liquidity and worsening financial position.[28]
In December 2018, it was announced that VTB Bank would be acquiring controlling stakes in Sarovbusinessbank (81.1%) and Zapsibcombank (71.8%).[29]
Mergers and acquisitionsedit
VTB Bank took over 15 banks between 2002 and February 2019:
On 24 July 2015, an agreement, which as approved by Dmitry Medvedev, was signed between the bank president, Director of Russian Post, Dmitry Strashnov, and Minister of Communications and Mass Media, Nikolai Nikiforov, on the Russian Post purchase of 50 percent minus 1 share of Leto Bank (Summer Bank) from VTB24, with the purpose of reorganising it into the National Post Bank. The remaining 50 percent plus one share will be owned by VTB24 of VTB Bank. VTB CEO Kostin suggested appointing Dmitry Rudenko, the current head of Leto Bank, as the head of Post Bank (Russia).
On 28 January 2016, sets of documents were signed between VTB24 and Russian Post on establishing the Post Bank. Russian Post purchased 50 percent minus one share of the newly established Post Bank through its 100 percent subsidiary. The remaining 50 percent plus one share is owned by VTB24 of VTB Bank. Dmitry Rudenko, the head of Leto Bank of VTB24, became the head of Post Bank (Russia).[37][38][39]
On 28 December 2017, VTB24 sells two shares to Dmitry Rudenko, the Chairman of the Board of Post Bank. VTB 24 and Russia Post have equal shares in Post Bank: each have 50 percent minus one share.[40] VTB24 has 1,062 branches.[41]
On 1 January 2018, VTB acquired VTB24. The integrated network has 1,350 branches.[42][43]
In May 2013 VTB completed a secondary public offering (SPO), issuing 2.5 trillion new additional shares by public subscription. All shares were placed on Moscow's primary stock exchange. The government did not participate in the SPO, so its stake in the bank decreased to 60.9% after the subscription closed. The bank raised 102.5 billion rubles worth of additional capital. Three sovereign wealth funds, Norway's Norges Bank Investment Management, Qatar Holding LLC and the State Oil Fund of the Republic of Azerbaijan (SOFAZ) and commercial bank China Construction Bank became the largest investors during the SPO, after purchasing more than half of the additional shares issued.[21]
As of April 2022, its Management Committee (referred as VTB Bank Management Board or VTB MB) includes:
Andrey Kostin - Chief executive of the Bank (since 10 June 2002), President and Chairman of VTB Bank Management Board, Member of the Supervisory Council,
Andrey Puchkov (First Deputy President and Chairman of VTB MB)
Denis Bortnikov (Deputy President and Chairman of VTB MB)
Olga Dergunova (Deputy President and Chairman of VTB MB)
Valery Lukyanenko (Deputy President and Chairman of VTB MB)
Anatoly Pechatnikov (Deputy President and Chairman of VTB MB)
Maxim Kondratenko (Member of VTB MB)
Erkin Norov (Member of VTB MB)
Dmitriy Pianov (Member of VTB MB)
Supervisory counciledit
As of April 2022[update], VTB's Supervisory Council consists of Anton Siluanov (Chairman of the Supervisory Council), Matthias Warnig (member of the Supervisory Council),[8] Sergey Dubinin (member of supervisory council), Mikhail Zadornov (Member of Supervisory Council), Andrey Kostin (President and Chairman of VTB Bank Management Board), Shahmar Movsumov (Independent member of supervisory council), Igor Repin (Independent member of Supervisory Council), Alexander Sokolov (Member of Supervisory Council), Vladimir Chistyukhin (member of supervisory council), Mukhadin Eskindarov (Member of Supervisory Council).[45]
Financial dataedit
Consolidated Statement of Financial Position as at 31 December 2021: net interest income – 646,3 RUB billion, net fee and commission income – 90,0 RUB billion, operating income before provisions – 822,7 RUB billion, staff costs and administrative expenses – -308,8 RUB billion, net profit – 327,4 RUB billion.[46]
The 2022 results showed a loss of 612.6 billion rubles ($7.7 billion), mainly due to sanctions.[47]
As of 12 February 2018, the United States Department of Treasury's Office of Foreign Assets Control (OFAC) Sectoral Sanctions Identifications list for VTB and its subsidiaries[49]
Bank VTB OAO 29, Bolshaya Morskaya str. Entity UKRAINE-EO13662 Non-SDN 100
Bank VTB, Open Joint-stock Company 29, Bolshaya Morskaya str. Entity UKRAINE-EO13662 Non-SDN 100
JSC VTB Bank 29, Bolshaya Morskaya str. Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank OAO 29, Bolshaya Morskaya str. Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank, OPEN JOINT-STOCK COMPANY 29, Bolshaya Morskaya str. Entity UKRAINE-EO13662 Non-SDN 100
Bank VTB 24 (Zakrytoe Aktsionernoe Obshchestvo) d. 35 ul. Myasnitskaya Entity UKRAINE-EO13662 Non-SDN 100
Bank VTB 24 Closed Joint Stock Company d. 35 ul. Myasnitskaya Entity UKRAINE-EO13662 Non-SDN 100
Bank VTB 24 Public Joint Stock Company d. 35 ul. Myasnitskaya Entity UKRAINE-EO13662 Non-SDN 100
Bank VTB 24 Publichnoe Aktsionernoe Obshchestvo d. 35 ul. Myasnitskaya Entity UKRAINE-EO13662 Non-SDN 100
VTB 24 JSC d. 35 ul. Myasnitskaya Entity UKRAINE-EO13662 Non-SDN 100
VTB 24 PAO d. 35 ul. Myasnitskaya Entity UKRAINE-EO13662 Non-SDN 100
PJSC VTB Bank (Kiev) 8/26, Shevchenka boulevard/Pushkinska street Entity UKRAINE-EO13662 Non-SDN 100
Public-Joint Stock Company VTB Bank (Ukraine) 8/26, Shevchenka boulevard/Pushkinska street Entity UKRAINE-EO13662 Non-SDN 100
Publichne Aktsionerne Tovarystvo VTB Bank 8/26, Shevchenka boulevard/Pushkinska street Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank, PJSC 8/26, Shevchenka boulevard/Pushkinska street Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank, PJSC (Ukraine) 8/26, Shevchenka boulevard/Pushkinska street Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank, Public Joint Stock Company 8/26, Shevchenka boulevard/Pushkinska street Entity UKRAINE-EO13662 Non-SDN 100
CJSC VTB Bank (Belarus) 14, Moskovskaya Street Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank (Belarus) 14, Moskovskaya Street Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank (Belarus) Closed Joint Stock Company 14, Moskovskaya Street Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank (Belarus), CJSC 14, Moskovskaya Street Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank (Armenia) CJSC 46 Ul Nalbandyan Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank (Armenia), CJSC 46 Ul Nalbandyan Entity UKRAINE-EO13662 Non-SDN 100
Bank VTB (Kazakhstan), JSC 28 v Timiryazeva str. Entity UKRAINE-EO13662 Non-SDN 100
Joint Stock Company VTB Bank (Kazakhstan) 28 v Timiryazeva str. Entity UKRAINE-EO13662 Non-SDN 100
Subsidiary JSC Bank VTB (Kazakhstan) 28 v Timiryazeva str. Entity UKRAINE-EO13662 Non-SDN 100
Bank VTB (Azerbaijan) OJSC 38 Khatai ave. Nasimi district Entity UKRAINE-EO13662 Non-SDN 100
JSC VTB Bank (Azerbaijan) 38 Khatai ave. Nasimi district Entity UKRAINE-EO13662 Non-SDN 100
VTB Bank (Azerbaijan), OJSC 38 Khatai ave. Nasimi district Entity UKRAINE-EO13662 Non-SDN 100
Since 2013, VTB Group has been supporting the Velobike, a bicycle-sharing system in Moscow, a project by the Department for Transport and Development of Road Infrastructure of the city. In 2018, the number of trips exceeded 3 million.
On 13 August 2014, the United States clarifies entities under sectoral sanctions. United States increases its sectoral sanctions on VTB Bank together with its subsidiaries (“the VTB Group”) and the Bank of Moscow through its parent bank, VTB Bank OAO, and other entities that VTB has 50 percent or greater ownership either individually or in the aggregate, either directly or indirectly. Also, US persons cannot use a third-party intermediary, and they must use caution during "transactions with a non-blocked entity in which one or more blocked persons has a significant ownership interest that is less than 50 percent or which one or more blocked persons may control by means other than a majority ownership interest."[55]
On 12 September 2014, the United States issues a consolidated listing of directives associated with Executive Order 13662 sanctions during the crisis in Ukraine. For the Russian financial sector, Directive 1 was amended to increase the financial sanctions on the Russian financial sector for "all transactions in, provision of financing for, and other dealings" in new equity or new debt issued on or after 12 September 2014 to longer than 30 days maturity. New equity or new debt issued from 29 July 2018 until 12 September 2018 was sanctioned if longer than 90 days maturity.[59][60][61][62]
In 2015, the banks' chief Executive Andrei Kostin predicted loses for the bank in the years to come because of the plunging ruble accelerated by international sanctions.[63]
On 15 March 2017, Ukraine imposed sanctions against VTB Bank and subsidiaries because of the ongoing Russian interference in Ukraine.[64][65]
On 28 November 2017, the United States increases the Executive Order 13662 sanctions to the Russian financial sector. For the Russian financial sector, Directive 1 was amended to increase the financial sanctions on the Russian financial sector for "all transactions in, provision of financing for, and other dealings" in new equity or new debt issued on or after 28 November 2017 to longer than 14 days maturity. New equity or new debt issued from 12 September 2014 until 28 November 2017 was sanctioned if longer than 30 days maturity.[66]
On 27 November 2018, the National Bank of Ukraine declares the Ukrainian subsidiary of VTB Bank insolvent due to its declining liquidity and worsening financial position.[67]
On 25 June 2020 European Court of Justice rejected VTB and Sberbank bank's 2014 lawsuit against EU sectoral sanctions citing that regulators were within their aims of "imposing a cost on the Russian government" because of the latter's actions in Ukraine.[68][69][70][71]: 46 The Court specified that intentionally ambiguous language versions of the regulation (that the bank argued were wrongly applied) doesn't prevent the Court to from choosing one that fits best its general purposes.[68]
In February 2022, amid the Russo-Ukrainian crisis, US and EU officials were reportedly finalizing an extensive package of sanctions on VTB bank and other related Russian entities.[72] On 24 February, after Russia launched a full-scale invasion of Ukraine, US president Joe Biden and British prime minister Boris Johnson announced new sanctions against VTB bank along with other Russian individuals and companies.[73]
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^(in Ukrainian) Ukrainian "daughter" of Russian "VTB Bank" - bankrupt, Economical Pravda (27 November 2018)
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^"В России создан "Почта Банк": "Почта России" и ВТБ24 подписали пакет документов о создании "Почта Банка". В церемонии приняли участие генеральный директор "Почты России" Дмитрий Страшнов и президент – председатель правления ВТБ24 Михаил Задорнов" ["Post Bank" was created in Russia: "Post of Russia" and VTB24 signed a package of documents on the establishment of "Post Bank." The ceremony was attended by General Director of Post of Russia Dmitry Strashnov and President and Chairman of the Board of VTB24 Mikhail Zadornov]. Post Bank website (in Russian). 28 January 2016. Retrieved 12 February 2018.
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^"Banks: Company Overview of Bank VTB 24 Public Joint-Stock Company". Bloomberg. Retrieved 12 February 2018.
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^"VTB bank sale launches privatisation drive in Russia", The Telegraph
^"Supervisory council". VTB. Retrieved 14 February 2019.
^"Раскрытие финансовых результатов по МСФО". VTB (in Russian). Retrieved 19 April 2022.
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^"КАМАЗ-Мастер: ралли Париж-Дакар, Шелковый путь - новости раллийной команды КАМАЗ-Мастер на официальном сайте ВТБ России".
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^"Revised Guidance on Entities Owned by Persons Whose Property and Interests in Property Are Blocked" (PDF). United States Department of Treasury. 13 August 2014. Retrieved 22 March 2018.
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^Пороше́нко, Петро́ Олексі́йович (16 March 2017). "Глава держави затвердив санкції щодо низки російських банків" [The head of state has approved sanctions against a number of Russian banks]. President of Ukraine website (in Ukrainian). Retrieved 28 February 2018.
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^Ukraine central bank declares Russian VTB subsidiary insolvent, Reuters (27 November 2018)
^ ab"European court rejects VTB's challenge to the EU's sectoral sanctions on Russia". Brick Court Chambers. Retrieved 18 February 2022.
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^Shalal, Andrea (11 February 2022). "SWIFT off Russia sanctions list, state banks likely target -U.S., EU officials". Reuters. Retrieved 18 February 2022.
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