At a glance
Mission & values
Press & Media
Business model
Ukrsotsbank Worldwide
Ukrsotsbank Factsheet
Support Print Add to bookmarks

Federico Ghidzonni: Ukraine is one of the countries where we stay


How do you assess the European Football Championship Final? Whether the Italy national team defeat makes a psychological impact on UniCredit Group behaviour on the global market considering that you were one of the official partners of Euro-2012?

—It was a merited victory for Spain It is anyway a great achievement that Italy reached the final. But sport is one thing and business is another. The economy is showing some problems and it makes business in Europe challenging. Year 2012 is proving to be a more difficult year than previously estimated from a macro-economic point of view. The UniCredit Group is noted for good assets diversification in different countries that at a critical juncture, as we have now, reduces dependence on the liquidity problems experienced by many banks. In some countries the situation is better in others it is worse, but as the banking group we carry very well.

In late June it was announced on UniCredit Group reorganization involving local units vesting with sweeping powers. What specific powers will be vested to Borys Timonkin the Ukrsotsbank Board Chairman?

— This decision shall be taken by the Supervisory Board of UniCredit Group on July 10th. So I am not going to speculate on a specific powers scope. I’d like to say that the restructuring purpose lies in better servicing and faster response on customers’ requests. Following this logic, the responsibilities of the bank within the group will be dealt with. The organization does not begin with the internal regulations, but with the client. The principles of the changes have already been identified and its implementation shall start up in the second half of the year. It would be premature to give clear answer on your question concerning Ukraine, but I can say that Ukraine also will have the opportunity to make business decisions and operate involving high degree of responsibility and freedom.

Your Group is one of a few European which have not replaced the local top manager on the expat. When the contract with Borys Timonkin should be terminated and under which circumstance you would not renew it?

— In Europe we have 22 regional banks and only one or two is chaired by not the local manager. Our model lies in involvement of local managers and local management if it is possible. I appreciate Borys work and I will make every effort to keep him in the team.

It’s not a secret that Borys Timonkin powers was rather trimmed from the date of bank purchase. It is known for a long time on the market that he is going to leave the Group in the nearest future and concentrate on the work within the Independent Association of Ukrainian Banks. Is it true?

— I’ll bring into focus that the Group has no intention to ask Mr. Timonkin to leave. I assure you that it is baseless rumours, which do not come from our group. He is a person we can fully trust. Intentions of Borys and group coincide very well. We perfectly pulled together.

For which period two banks of the group which are already operating under the same brand will independently operate on the territory of Ukraine, considering that it is inconvenient for customers? When the banks will be merged?

— If it depends only on us, from a business point of view, the merger would happen tomorrow. But we need to take into account the views of different parties, including central banks and regulators. Within the group we seek to draw and to complete the merger as soon as possible. We are working with all the regulators involved to smotth the process. When we get consent from all of them we will be able to move quickly to banks merger.

Are you going to reduce funding of the “subsidiaries” in the Eastern Europe after the UniCredit rating downgrade?

— Considering the conclusions of the rating agencies, you will see that UniCredit itself deserves a higher rating, but Italy rating dropped off and therefore rating agencies adjust the note of the banks to the note of the sovereign State. However, our capital and liquidity position remain strong. Therefore, we do not want to reduce funding in Central and Eastern Europe and wherever else. Of course the situation has changed if compared with the pre-crisis. I believe that balance between deposits and loans should exist at all markets if we want to grow steadily. If necessary, the group, of course, will support the new direction. We will not reduce funding, but rather introduce means based on the strategic plan.

But how would you explain why Ukrsotsbank was actively purchasing currency on the interbank market for group funding return in late 2011 and early 2012?

— Change in the euro and the dollar proportion was implemented due to the decision of the local regulators, aimed on hryvnia loans, its costly part adjustment. Considering operational performance of banks on deposits, we have very good growth in dollar deposits. Therefore, group funding is not so necessary for bank. Currency purchase by Ukrsotsbank was made for the interest payment. Within the group we do not take a decision to reduce or withdraw funding in respect of Ukrsotsbank. Everything depends on the institution needs. Today I reviewed Ukrsotsbank statistics and noticed the large increase in hryvnia deposits. Our group cannot provide funding involving hryvnia, so the bank easily finds it on the local market.

To what extent the group is interested in the Ukrainian government securities (GS)? Do you increase or decrease this portfolio and why?

— In all the countries our group adheres to the policy as follows: we purchase securities only to provide liquidity. The group does not invest in securities for the P & L (income generation — Ъ). We have a small portfolio on securities trading; we purchase securities in order to transfer it to the central bank for liquidity. And such a policy works, without exception, in all countries where the bank is present.

Your customers in other countries are not interested in our government securities?

— Customers shall choose themselves in what to invest as we do not carry out consultations on the GS. The bank prefers to grant loans flowing into the real economy sector.

Why does UniCredit decide to reduce Ukrsotsbank loan portfolio in 2012 by more than 10%, considering that it will lead to bank market share and interest income loss?

— First of all, as you know, the banks throughout the world are optimizing assets weighted for risk (RWA) due to regulators requirement on capital strengthening. In this situation, credit provision arrangement should be very careful and banks need to pay attention also to credit quality. The situation in Ukraine is similar to that in other countries: we do not stop lending and did not ask Ukrsotsbank to freeze lending even in the peak of the liquidity crisis observed at the end of last year. Perhaps, the Ukrsotsbank loan portfolio is growing with the low rates, but in any case it is growing. And it is a high-quality growth. And if we consider the portfolio, then we should not forget that in many situations instead of direct lending we are offering other solutions to enterprises. The Group is the third in Europe arranger of corporate bonds. During January-April, we organized 85 issues of enterprises bonds for 23 billion Euros. This money goes to the corporations, but they are not recorded as loans. We followed the same way involving some of the largest groups in Ukraine. For banks this way is more convenient.

Ukrsotsbank during the crisis was not defaulting, that is impossible for a bank that actively granted foreign currency loans, including mortgages. It is the only foreign bank with such dynamics, so other banks consider as follows: Ukrsotsbank does not form reserves completely, as UniCredit Group refuses to increase capital to cover potential losses, and reserves are formed only from the operating profit. How long this situation will be lasting?

— Indeed, Ukrsotsbank was never defaulting, that satisfies us greatly. The Bank has worked hard to improve the loan portfolio in order to become more efficient in its operation. If you have a good balance of costs and profits (cost/income ratio) , then you’ll get a good result. Regarding this ratio, Ukrsotsbank has been one of the best bank in Ukraine for the last three years. Gross operating profit may cover all necessary expenses. In addition the Bank of Austria provides guarantees to cover losses if they occur. The reserves amount can be argued for weeks, but the important thing is that the bank has a good balance. It began to restructure its portfolio in 2007 until its purchase by the UniCredit group.

What are your options to leave the Ukrainian market, as there no options to whoml Ukrsotsbank and UniCredit Bank may be sold and its liquidation may be loss-making as well?

— We have never considered options to leave the Ukrainian market. Herewith I would like to return to your question on capital. If you're entrenched in a country and you have at least a slight growth, you have to add capital in order not to lose the growth. We will see the Ukrsotsbank need in the capital, but Ukraine is a country where we will definitely stay. I believe that Ukraine actually has very good potential. Why should we leave?

What is the cost these banks in your opinion? For example, according to the UX stock exchange quotations Ukrsotsbank was evaluated at a price of $ 225 million. Do you evaluate your asset in the same way? Or do you consider the banks cost in their regulatory capital?

— I cannot define the Ukrsotsbank cost as I’ve never considered its sale and do not supervise its quotations. I think in terms of the future therefore I know that the bank will be on the strong track.

To read an original article

Phone: 0 800 3000 90

Branches & ATMs
0 800 3000 90 0 800 3000 90
0 800 3000 90 0 800 3000 90

Calls from fixed and mobile networks in Ukraine are free of charge.

Number to be used for calls from mobile number within Ukraine for Vodafone, Kyivstar, lifecell subscribers.

Rates according to tariff plan used by user.

The callback service for mobile calls.

International and domestic calls according to the tariffs of the operator.

Rates apply to the actual date of writing-off from the account and are close to the bank’s exchange rate while blocking the necessary amount at the time of the transaction fulfilment.
At first card account currency is stated, hereafter the settlement currency with payment system is indicated.
Service quality appraisal


Any questions, offers, comments?

We appreciate our cooperation with you. Please fill the feedback form bellow for sharing your suggestions , comments as well as ask us a question or call Contact-center of JSC "Ukrsotsbank" by number 0 800 5000 20 (landline calls within Ukraine are free).

I want to receive the information on new Bank’s services, promotion campaigns and prize drawings.

Required fields