OREANDA-NEWS. May 30, 2012. First Ukrainian International Bank (FUIB) released its Annual Report 2011. FUIB’s Annual Report named "20 years of sustainable growth" along with review of performance results 2011, provides a brief overview of the key bank achievements starting from the year of its foundation in 1991.

Last year was a milestone in FUIB’s history that laid a solid foundation for its further sustainable growth. After its successfully completed merger with Dongorbank, FUIB entered Ukraine’s TOP 10 banks by key financials. FUIB’s 2011 profit before provisions and taxes of USD 76.1 million was USD 9.1 million (13.6%) up YOY due to the growth in income exceeding the growth of operating expenditures. The growth in income is related to both the growth in business volume and enhanced performance efficiency.

“Looking back at the last year we can say that FUIB is implementing successfully its strategy towards the goal – FUIB among Ukraine’s TOP 5 financial institutions, which is confirmed by both the Bank’s strong performance indicators, and product and service innovations introduced in 2011”, Konstantin Vaysman, Chairman of the FUIB’s Management Board, says. FUIB will be No 1 by efficiency in the banking system and will stand out from its peers through impressive customer service as a strong competitor to major financial market participants”.

FUIB consciously aims at implementation of the best international banking business standards and practices. For two years FUIB is among the leaders in informational transparency by Ukrainian banks according to findings of the surveys held by Standard & Poor’s (2010) and Credit-Rating (2011) agencies with support from Financial Initiatives Agency and the Financial Sector Development Project (FINREP) of the USAID. FUIB is No 1 in the 2011 Most Dynamically Developing Banks rankings by RBC-Ukraine Information Agency.

“Following its merger with Dongorbank in July, FUIB enhanced its balance sheet structure, ensured lower operating expenses and enjoyed economies of scale”, Ilya Arkhipov, Chairman of the FUIB’s Supervisory Board, marks. “The Bank enhanced corporate governance standards, created a uniform risk management system and improved control and reporting quality. Loans/Customer Accounts of 93.4% confirms the FUIB’s sustainability and reliability”.

Financial Result of Corporate Business

During 2011 FUIB’s corporate business ensured growth in the corporate loan portfolio of USD 192.7 million (11.9%) to USD 1,816.4 million. Growth in the corporate loan portfolio exceeded growth in the individual loan portfolio; as the result, during the year its share in FUIB’s total loan portfolio grew from 73.6% to 75.0%. During 2011 corporate accounts with FUIB increased by USD 498.8 million (52.6% up) to USD 1,447.4 million. Corporate business 2011 operating income was USD 81.8 million (47.9% of FUIB’s operating income). Corporate business’ OPEX (including allocation of overhead expenses) totalled USD 37.1 million (2011 C/I of 45.3%). In 2011 there was a recovery of allowances for credit and off-balance-sheet operations of corporate business by USD 6.1 million. As a result, FUIB’s corporate business’ 2011 profit totalled USD 50.9 million.

Financial Result of Retail Business

During 2011 FUIB’s individual loan portfolio grew by USD 23.0 million (3.9% up) to USD 606.3 million. Individual accounts increased by USD 92.6 million (9.3% up) to USD 1,083.9 million. To reduce excessive liquidity during the year, FUIB restricted growth in high-interest time accounts with FUIB. FUIB’s retail business’ 2011 operating income totalled USD 54.6 million (31.9% of FUIB’s operating income). Retail business’ OPEX of USD 55.2 million (including allocation of overhead expenses) and expenses towards allowances of USD 16.0 million resulted in retail business’ negative result of USD 16.6 million.

Financial Result of Investment Business

Within excessive liquidity management and towards forming secondary liquidity FUIB invested untied funds in local currency government bonds and NBU’s certificates of deposit, which resulted in a USD 140.7 million (36.8%) increase in FUIB’s securities portfolio to USD 522.9 million. In line with the effective terms, during 2011 debt to foreign banks decreased by USD 109.0 million (27.1%) to USD 402.6 million. Also, the Bank actively performed resource and currency arbitrage transactions in the interbank market. FUIB’s investment business’ 2011 operating income totalled USD 29.3 million (17.2% of FUIB’s operating income). Investment business’ OPEX (including allocation of overhead expenses) totalled USD 7.2 million (2011 C/I of 24.6%). In 2011 there was a recovery of allowance for investment business’ active transactions of USD 5.2 million. As a result, FUIB’s investment business’ 2011 profit was USD 27.3 million.