OREANDA-NEWS. June 8, 2012. The Bank’s capital adequacy ratio according to Basel 1 requirements exceeded the minimum level of 8% as of 31.12.2011.

The Bank’s main efforts were aimed at the profitability growth and asset and liability structure improvement. The volume of gross loan portfolio increased by 15%. Despite market lowering of the interest rates and competition strengthening in 2011 net interest margin (NIM) increased to 6.0% from 5.6%. Thus core banking income in 2011 amounted to 21.7 bln rubles (growth by 11.5% vs 2010).

The intensive growth of lending in 2011 was followed by the increase of administrative expenses. But due to cost lowering programs the Bank succeed in keeping the growth of personnel expenses per one employee at the level of 10%, which is considerably lower respective market trend.

The Bank’s financial result for 2011 has been mainly affected by allowances for loan losses. The key factor was conservative revaluation of some large loans, granted before 2009, due to changes of the borrowers’ financial position in 2011.

Thus the Bank’s net loss for 2011 amounted to 4.2 bln rubles. This financial result includes 2.1 bln rubles net loss of consolidated URALSIB Leasing Group, caused by allowances for leasing portfolio losses.

During the last year the Bank rearranged its internal processes to optimize the potential of its resources. The results of such transformations should allow the Bank to retain the establishment growth in income base and to improve in general the efficiency of its business in 2012.