Promsvyazbank reports preliminary unconsolidated results for 2008

According to preliminary unconsolidated financial results, Promsvyazbank’s (PSB) assets rose by 55% during 2008 to RUB 446 billion. Following the additional share issue at the end of December 2008, PSB statutory capital (under RAS) reached RUB 42.9 billion.

Net loans to customers (which also include interbank loans), at RUB 329 billion, were 43% higher compared with the beginning of 2008, amid 30% growth of the loan portfolio in H1 2008 and a slowdown in growth in H2 2008 due to the adoption of a more conservative lending policy.

Corporate accounts and deposits are estimated at RUB 217 billion, reflecting 42% and 10% growth in 2008 and Q4 2008, respectively.

Retail accounts and deposits rose by 37% in 2008 to RUB 48 billion. In Q4 2008, they demonstrated a modest 2% increase.

As at 1 January 2008, PSB' level of liquid assets was more than sufficient. The quick liquidity ratio (N2) reached 75% (with the minimum required by CBR at 15%), while highly liquid assets were estimated at RUB 81 billion.

Commenting on the 2008 results, PSB President Alexander Levkovsky said:
«Despite the difficult situation in Q4 2008, we are pleased with PSB’s overall financial performance in 2008. The sufficient financial strength allowed PSB to rapidly adapt to the changed market environment, while focusing on tighter risk management and maintaining sufficient liquidity. At the same time, PSB was able to successfully implement its corporate business development strategy”.

Consolidated financial statements, prepared in accordance with the International Financial Reporting Standards (IFRS), will be published in March 2009.

2008 Milestones

January

• PSB places US$ 100 million 10 non-call 5 subordinated notes due 2018

February

• PSB opens a branch in Blagoveshchensk

March

• PSB launches 3 new products (PSB-Turnover, PSB-Overdraft and PSB-Transport) under its small and medium-sized business program
• PSB introduces a new range of retail deposits

April

• PSB receives a 12-month US$ 175 million syndicated loan
• All PSB branches connect to PSB-Retail - a new Internet-based retail services system

May

• Moody’s upgrades PSB Financial Strength Rating (BFSR) to D from D-, and the long-term bank deposit ratings in local and foreign currencies to Ba2 (outlook: stable) from Ba3
• PSB increases capital by RUB 4.3 billion, following an additional share issue
• PSB opens its first retail sub-branch in Cyprus and a branch in Stavropol
• PSB introduces deposits tailored to small and medium businesses

June

• PSB places RUB 5 billion Series 06 bond at the MICEX Stock Exchange
• Standard & Poor’s upgrades the long-term credit rating to ВВ- from В+
• 3 independent directors are elected to the PSB Board of Directors
• The Banking Group Promsvyazbank is established, which includes OJSC Volgoprombank
• PSB opens a branch in Penza

July

• PSB places a 5-year US$ 150 million Eurobond issue with a put option after 3 years

August

• PSB receives a 10-year US$ 75 million subordinated loan from the controlling shareholder Promsvyaz Capital B.V.
• PSB raises a 12-month US$ 280 million syndicated loan, with a 1-year extension option
• PSB launches a new product for small and medium businesses, PSB-Equipment
• PSB becomes partner to OPORA Russia, a non-governmental organization of small and medium-sized business and, jointly with the organization, launches “Funding for the Young” business project competition

September

• PSB raises a 10-year US$ 40 million subordinated loan from the controlling shareholder Promsvyaz Capital B.V.
• PSB launches a co-brand credit card program jointly with Transaero Airlines and Visa Inc.
• PSB opens a branch in Syktyvkar

October

• Preliminary agreements are reached on integrating JSC Yarsotsbank into the Banking Group Promsvyazbank
• On the back of the liquidity crisis, Fitch changes the rating outlook for 6 Russian privately owned banks, including PSB, from “positive” to “stable”. Standard & Poor’s changes the rating outlook for 13 private banks, including PSB, from “stable” to “negative”

November

• Agreement is reached on integrating JSC Nizhny Novgorod Bank into the Banking Group Promsvyazbank
• National Rating Agency assigns PSB an АА+ standalone credit rating

December

• PSB introduces a retail multi-currency deposit My Multi-choice
• PSB obtains the direct merchant account license from Visa Inc.
• PSB opens a branch in Tver
• Following an additional share issue, PSВ total capital increases by RUB 2.07 billion
• PSB completes the acquisition of 51.3% shares of Yarsotsbank and 85.1% shares of Bank Nizhny Novgorod Bank
• PSB repays the US$ 200 million syndicated loan using its own liquid assets

 About Promsvyazbank

OJSC Promsvyazbank, founded in 1995, is one of the leading privately-owned Russian banks, with total assets of RUB407.6 billion, and total capital of RUB46.7 billion under IFRS as of 30 September 2008. Holding company Promsvyaz Capital B. V. owns 84.68% of the Bank, the remaining 15.32% are owned by Commerzbank Auslandsbanken Holding AG, a subsidiary of the second-largest German bank Commerzbank AG. PSB has the following international credit ratings: “Ba2” from Moody’s Investors Service (stable outlook); “BB-” from Standard & Poor's (negative outlook); “B+” from Fitch Ratings (stable outlook).  As of 1 December 2008, the regional network of the Bank in Russia encompassed about 170 sub-branches, 46 branches and 1 representative office; a foreign branch in Cyprus; and foreign representative offices in Kyrgyz Republic, Ukraine, China, and India. www.psbank.ru