JSC VTB Bank's supervisory board approved a new three-year strategy under which the bank aims to boost its net profit to around 200 billion Russian rubles by 2019, while achieving a return on equity of between 13% and 14% and a cost-to-income ratio of around 40%.
The bank also expects its loan portfolio to expand by 10% per year, and it eyes above-market growth in the retail segment, with plans to increase the share of retail loans in its entire loan portfolio to 30% from 20% and the proportion of retail deposits from 30% to 40% of total liabilities.
VTB's corporate-investment business will strive to increase profitability and aim to expand lending to at least match the market-average growth rate, estimated at around 8% per year. In relation to banking services for medium-sized businesses, the bank intends, among other things, to expand its customer base by three times and the transactions segment by four times to overtake the average growth rate.
The lender said its strategy is based on "a moderately optimistic" economic forecast, including economic growth at between 2% and 2.4% per year, a targeted inflation rate of 4.5% and the main central bank rate at 6% by the end of 2019.
VTB Bank also said Dec. 15 that Sergey Dubinin, the former head of the Russian central bank and an ex-deputy finance minister, was appointed chairman of its supervisory board, replacing Alexei Ulyukayev.
In addition, Bank VTB 24's management board head Mikhail Zadornov and BM-Bank JSC's management board President Gennady Soldatenkov joined VTB's management board as part of its consolidation with Bank VTB 24 and in line with plans to optimize the group's management. The appointments need to be approved by the Russian central bank.
Integration with Bank VTB 24, scheduled for completion in January 2018 at the latest, is a key strategic part of the new strategy and expected to streamline costs and improve the overall financial results of the entire group, VTB noted.
As of Dec. 14, US$1 was equivalent to 61.19 Russian rubles.