Retail Banking
As one of the key players in St. Petersburg’s retail banking services, Bank Saint Petersburg aims to become the first bank of choice for the city's residents. The Bank currently has 2 090 000 retail customers, forming a solid base for the future successful growth of its retail business.
Throughout 2018, the retail loan portfolio increased by 18.4% to RUB 89.7 bn, mortgage loans grew by 10.9%, consumer loans grew by 38.9%, and car loans grew by 68.5%. The share of loans to individuals reached 23.9% of the total loan portfolio.
In 2018, the total amount of retail deposits increased by 21.1%, totaling RUB 249.1 bn. The share of retail deposits amounted to 60.1% of total customer deposits.
RETAIL DEPOSIT SERVICES
An extensive sales network, an opportunity to make deposits online, a high quality of services, reliability, a wide range of deposit options and competitive interest rates provide the Bank with a continuously increasing number of loyal customers and a steadily broadening deposit base.
According to the Interfax agency, the Bank ranks 15th among Russian banks by total retail deposits as of January 1, 2019.
In order to increase its customer base and attract additional deposit inflow, the Bank offered its customers a choice of several seasonal deposits with historically high interest rates in 2018. Customers receiving their pensions through the Bank enjoyed increased deposit rates on their Pension deposits.
The Bank’s customers also have an opportunity to make deposits online. Online deposits accounted for 70.7% of retail deposits placed in 2018.
Dynamics of Retail Customer Deposits, RUB bn
BANK CARDS
One of the priority areas for the Bank's retail business is the issuance of bank cards and the provision of related services. As of January 1, 2019, a total number of all types of plastic bank cards issued reached 1 354 000. The Bank has also seen an annual increase in the number of its payroll customers: 8 000 payroll programs with a total of 740 000 active payroll cards as of January 1, 2019.
To ensure compliance with the Federal Law on the National Payment System, the Bank issued more than 290 000 MIR cards as part of payroll projects, about 24 000 MIR pension cards, and more than 120 000 parent subsidy MIR cards in 2018.
The Bank has started issuance of a new card product for lovers of travelling — Mastercard World Travel and Mastercard World Travel Premium with a new Travel loyalty program that refunds owners with up to 2% for any purchase with the card and up to 10% for purchases at the Bank’s travel-portal. Miles can be spent for any air and rail road tickets, hotel bookings and other expenses related to traveling. The program offers the following services to its customers: complimentary travel insurance, benefit cash withdrawal abroad, accrual of interest on the account balance in bonuses, free Business Lounge pass, Green card refund for car travelers as well as 5 unique card design options.
The Bank has launched its first campus project with ITMO University. Now students can use their bank card not only as a convenient payment instrument, but also as a University pass. And it will soon be used as a student’s record book and library card. This campus project opens new horizons to the Bank in cooperation with educational institutions.
In the reporting year, the Bank started issuing UnionPay cards. The cards are issued in RUB, USD or EUR and support QuickPass payment. UnionPay cards are accepted in 171 countries, serviced by more than 52 million sales points and 2.6 million ATMs across the world. In Russia UnionPay cards are accepted in more than 90% of sales points and ATMs.
Since 2018, when ordering flagship card products Yarkaya, Travel and Pension customers have an option of free courier delivery. Delivery to customers in St. Petersburg is made the following business day.
Bank Saint Petersburg was the first to have its application for the project St. Petersburg Citizen Single Card approved. Smart-card will combine functions of a banking, sales and bonus card as well as electronic ticket for city public transport.
An identification app will store data about the holder in the card. This includes the holder’s surname, name and patronymic, date of birth, photo, passport details, Personal Insurance Policy Number (SNILS) and medical insurance number. The card will be issued free of charge based on MIR National Payment System.
Bank Saint Petersburg has doubled the number of turnstiles accepting bank cards for St. Petersburg metro fare payments. Metro fare can be paid by any bank card supporting PayPass or PayWave.
In 2018, a total number of pension cards grew by 43%, now reaching 50 000.
MORTGAGE LENDING
The Bank ranks 3rd among all local banks and 1st among private banks in St. Petersburg’s mortgage lending market. Throughout 2018, the Bank provided a total of RUB 25.3 bn in the form of 11 310 loans, compared to RUB 24.9 bn and 11 326 loans in the previous year. 66% of the total mortgage loan portfolio consisted of mortgage loans for newly constructed buildings.
During the reporting period, the Bank of Russia was gradually lowering its key rate, enabling the Bank to reduce its mortgage interest rates both as limited special offers for certain partners and permanently.
At the end of 2018, Bank Saint Petersburg ranked 14th in Russia in terms of new mortgages issued.
The Bank opened 7 Mortgage Lending Centers (5 in St. Petersburg, 1 in Moscow and 1 in Kaliningrad), where customers can get detailed advice on all mortgage lending programs available and obtain an estimated calculation of the amount and maturity, as well as apply for a mortgage loan. A dedicated loan officer supports each customer throughout the entire process. As an additional convenience for the customers and a way to ensure confidentiality, each center has a separate meeting room; the Bank's outlets also have depository areas for transactions using safe deposit boxes.
The Bank is continuing its productive cooperation with construction companies and real estate agencies. By the end of 2018, more than 240 developers and over 550 construction projects received the Bank’s accreditation. Customers can receive mortgage-related advice and apply for a mortgage loan at the Bank's representative desks located in the offices of its partner companies.
In 2018, Bank Saint Petersburg expanded the volume of operations with a new product in real estate transactions — the escrow account, a special-purpose account opened in the name of the depositor (buyer of the property) where escrow funds can be deposited, blocked or transferred to the beneficiary (recipient of the transaction funds) after certain conditions agreed by the parties met. An escrow account is opened after a trilateral agreement is signed to formalize the terms and conditions for depositing funds and the procedure for debiting them. Escrow accounts are opened free of charge.
Moreover, the Bank has launched a refinancing plan for new build mortgage loans. Customers can refinance the mortgage they received in another bank. The program covers residential and commercial premises, including apartments. No documents except passport are needed for application within the refinancing plan to be considered.
The Bank successfully completed its second mortgage-backed securitization deal worth RUB 7.5 bn on December 3, 2018. Coupon rate amounted to 9.35%
These are mortgage-secured bonds. Loans included in mortgage security are characterized by a low average LTV ratio of 32.25%. Nowadays, this ratio is lower than the market average.
Bank Saint Petersburg was recognized as Russia’s best mortgage bank for the third time by Global Banking and Finance Review Awards. The competition’s expert board acknowledged the Bank as Best Mortgage Bank Russia 2018. In addition, Bank Saint Petersburg was distinguished as the Best Bank for Escrow Accounts Russia.
The Bank has also rated first in the Customer Confidence contest as Mortgage Bank Enjoying the Strongest Customer Confidence in St. Petersburg Real Estate Market.
CAR LOANS
The Bank is represented by three Car Lending Centers in St. Petersburg and one Car Lending Center in Kaliningrad where customers can get detailed advice on all car lending programs, apply for and receive a loan.
The main target of Car Lending Group for 2018 was to increase the loan portfolio maintaining its high quality. The target was achieved by creating one of the best product lines in the car lending market (competitive interest rates, possibility to include additional options to the loan, programs with initial payment starting from 0%) on the one hand, and creating long-term partner relations with dealers on the other hand. Faster review of loan applications and development of remote sale channels have also enabled the Bank to attract a substantial number of new active customers.
The total value of loans provided in 2018 has become record high in Bank Saint Petersburg exceeding results of the previous year by 81%.
In 2018, the Bank ranked 3rd out of 20 as the Best St. Petersburg Bank for Car Lending, at the same time being among top 5 St. Petersburg and top 15 Russian banks in terms of retail car loan portfolio banks.
CONSUMER LOANS
Bank Saint Petersburg takes a conservative approach to risk and offers consumer loans only to the existing customer base. The target segment for the unsecured lending program is still represented by the customers, holding the Bank's payroll cards, whose financial position is well known to the Bank. 88% of the unsecured loan portfolio is attributed to payroll card holders. The Bank also offers loans to customers who have a good profile with the Bank or are employed by reliable partner entities.
This approach has proved to be the most efficient one. First of all, targeted work with customers and forecasting their individual needs warrant a more sizeable response. The second advantage is that the Bank can take a cautious approach to new borrowers and accept only measured risks of the external unsecured lending market, having over 2 090 000 customers whose financial position it can assess most efficiently.
Bank Saint Petersburg continues to maintain and improve the technology of issuing consumer loans, which significantly saves the customers time, as it implies the full remote receipt of loans. Internet Bank users can not only sign an agreement and receive money into an account through a personal account on a proposal approved by the Bank, but also make an application on their own, and track the course of its consideration.
The Bank ranks 3rd among all banks and 1st among private banks in St. Petersburg’s market of consumer loans and credit cards.
Improvement efforts in 2018 were focused on scaling unsecured lending which allowed to increase the loan portfolio in low-risk customer segments. The Bank will continue to enlarge the customer base and maximize its potential by improving the quality of customer service.
PAYMENTS AND TRANSFERS
In 2018, the Bank significantly expanded the possibilities for convenient and fast transfer to legal entities and individuals. At the beginning of the year, fast payment in digital channels became available to more than 5 thousand organizations in the housing and utilities sector and telecommunications services.
The audience of customers-active users of digital channels increased by 20% and amounted to almost 400 thousand people in December, while the number of transfers made increased by 40% and in November for the first time exceeded 1 million transactions per month.
The number of users of the mobile application grew throughout 2018 at a fast pace and amounted to 274 thousand people in December, which is 40% more than the figure as of the year beginning. Increase in the number of transfers made by these customers amounted to more than 70%, reaching 690 thousand operations per month.
At the end of the year, the Bank implemented a utility bill payment service in the BSPB mobile application by reading a QR code. Now it is only needed to read the code placed on the receipt and confirm the transfer according to details filled in by the Bank.
LOYALTY PROGRAMS
In 2018, the Bank offered its customers to join three loyalty programs:
- YARKO — emotional and engaging;
- Cashback — for rational customers;
- Travel — for travel lovers.
In 2018, the YARKO bonus loyalty program celebrated its 4th anniversary and was once again distinguished as the best financial institute loyalty program in Russia by Loyalty Awards Russia 2018.
The YARKO program is actively developing its partner base. More than 160 partners have joined the program in 2018. The Bank targets at partners providing cardholders with interesting experience and positive emotions. Among the new partners are the Russian Museum, Music Hall, Theatre of Musical Comedy, the Palkin restaurant, the IDIOT restaurant, GetFaster, British Bakery, the Schastye restaurant and many others. Nowadays, the catalogue offers bonuses from large Russian shopping malls, world cosmetics and clothing brands, large electronic retail chains and etc.
Strong confidence of YARKO customers is unchanged with their number reaching 630 000 as of January 1, 2019. At the same time, the number of active users of the program has increased by 50% compared to the previous year.
The new mile loyalty programs Mastercard World Travel and Mastercard World Travel Premium enable its cardholders to travel, get new emotions and experience out of the earned miles.
They reward customers for purchases by Mastercard World Travel and Mastercard World Travel Premium and offer additional increased miles when making purchases at the Travel portal as well as accrual of interest on the account balance in miles. Miles can be spent for any airline tickets, travel agencies, rail road tickets, cruises, hotels and car rent outside the Russian Federation.