Bank Saint Petersburg sees its team as the main drive for the 2018–2020 Strategy. The Bank builds mutually beneficial relations with its personnel, motivating each employee to archive strategic goals and rewards them based on fair estimation.
Bank Saint Petersburg is one of the largest employers in the region with 4 258 employees as of the end of 2019: 31% employees work in branches, 69% — in the Bank’s Headquarters.
Respectful mutually beneficial relations between the Bank and the staff are implemented through development, motivation, and recognition tools for the results achieved. Digital transformation and the continuous search for efficiency gains provide the Bank’s employees with new opportunities to realize their own potential. The implemented practices of kanban and agile, aimed at accelerating the entry into the market of banking products, are gradually becoming a characteristic feature of the Bank’s corporate culture, where an important role is given to team management.
HUMAN RESOURCE DIGITAL SOLUTIONS
Digital technologies are penetrating ever deeper into all areas of work with staff. The Personnel Selection and Adaptation Department, improving the recruiting process, uses digital solutions in interviews and candidate assessment. To attract new digital expertise, regional selection, referral programs, and Social Recruitment are used.
At the end of 2019, the Bank launched an internship program called Brain Camp, in which talented students and graduates of relevant universities will gain practical experience from participating in the implementation of projects in the Big Data field, as well as in the development of technical solutions and their testing, system analysis and other areas. The program will continue in 2020, which will strengthen the Bank’s brand as an employer in the IT environment and attract highly potential young specialists to the team.
For the ninth year, the Bank has successfully employed the Future Banker program, aimed at selecting and training graduates of specialized universities in St. Petersburg and young specialists. 108 out of 130 students of the program got job offers from the Bank in 2019.
Generally, in 2019 the Bank hired 1 128 employees, which is 2 times more than in 2018. The growth is associated with the Bank’s participation in the Resident ID Card city project, the attraction of an additional IT resource for digitalization processes, business development in online channels, as well as business development in Novosibirsk and Moscow.
In addition to attracting personnel, special attention is paid to the effectiveness of newly hired employees. As part of onboarding, a chat bot was launched in 2019 for IT block employees in order to scale the resource to the entire pool in 2020. The chatbot allows new employees to find out the information about the Bank as an employer, receive prompt response from an HR specialist and much more.
To reach its strategic goals, Bank Saint Petersburg is striving to create a product range that matches the interests of its corporate clients as much as possible. Despite the challenging macroeconomic situation, the Bank continues to provide corporate lending to companies from various industry sectors and is strengthening its positions in this market segment. In addition to granting new loans, the Bank is also improving the terms of already existing loans, which indicates general financial sector recovery.
In 2017, within the RUB 15 bn credit limit allocated to TAIF Group for a 5-year period, the Bank granted a USD 200 mln loan for working capital purposes. TAIF Group is a major Russian group of companies which controls 96% of the chemical and petrochemical, as well as 50% of the oil and gas processing industries of Tatarstan.
In the reporting year, Bank Saint Petersburg set a RUB 6.5 bn credit limit for Trading House Perekrestok JSC, one of Russia’s leading retail chains and member of the X5 Retail Group.
In 2017, Bank Saint Petersburg and TransFin-M PJSC, one of the leading players in the Russian finance lease market, signed an agreement for two 4.5-year credit lines of RUB 700 mln and 600 mln respectively. The intended use of the first facility is to purchase quarry equipment which will subsequently be leased out to coal mining enterprises. Proceeds from the second loan will be used by TransFin-M to buy special-purpose equipment for future leases and to finance the company’s working capital. The total amount of loans provided by the Bank to TransFin-M over the entire period of their business relationship approximates RUB 5 bn.
The Bank and LSR Group entered into a Master Agreement, establishing the general terms of lending in the total amount of RUB 2 bn for 3 years, to fund the operations of the borrower and LSR Group companies. LSR is an all-segment real estate developer with projects ranging from mass-market housing to luxury properties designed by leading Russian and international architects.
Bank Saint Petersburg extended to Leader-Invest JSC a 2-year credit line of RUB 2 bn. The company will use the loan to finance its working capital and investment projects. Leader-Invest is a Moscow-based developer involved in residential and commercial real estate and integrated urban development projects. The total area of its properties is nearly 3 mln sq. m.
During the reporting year the Bank also allocated a 2-year credit facility of RUB 500 mln in graduated tranches to BSS company. The loan will fund various projects of the pharmaceutical group related to the opening of new branches and logistics hub development. BSS primarily specializes in wholesale pharmaceutical trade.
The Bank’s representative office in Novosibirsk is focusing on corporate customers operating in the Siberian and Far Eastern Federal Districts.
The Bank’s wider presence in Siberia is evidenced by new partnership projects started in 2017 with such market leaders as Kuzbasskaya Toplivnaya Company PJSC, Siberian Business Union JSC, Sibeco JSC, ELSIB Research and Production Association PJSC, Katren Research and Production Company JSC, as well as other leading enterprises of the Siberian Federal District.
The Bank’s wider presence in the Far East is evidenced by new loan agreements signed with such leading Far Eastern companies as Solntsevsky Coal Mine LLC and Boshnyakovsky Coal Mine LLC.
One of the strategic priorities of the Bank’s deposit business is to gradually transfer conclusion of deposit agreements to digital channels. This substantially reduces the workload of branch network employees who will be able to focus instead on individually tailored deposits and devote more time to other products for corporate customers. More than 80% of deposits in the standard range are already placed through Internet Bank i2B. One of the Bank’s strategic goals is an increase in share of online deposits as well as full transfer of all standard range deposits (placed on standard terms and conditions) to Internet Bank i2B.
DIGITAL ACADEMY AND OTHER TRENDS IN PERSONNEL DEVELOPMENT
The Bank pays great attention to the professional development of the team, increasing its potential in different directions: managerial effectiveness, professional expertise, interaction with the client, digitalization of services and solutions.
A cross-functional team approach to solving problems is being scaled to an increasing number of product areas and segments, enabling employees to develop systemic thinking and a pass-through understanding of processes, and the Bank to quickly implement products and services.
Digital Academy, a separate area of personnel development, was created to develop special competencies and flexible response to the needs of the IT function in the HR structure. In 2019, more than 800 employees were trained in 14 new Digital Academy programs. The Bank provides employees with access to the highest level of professional expertise, localized in recognized competence centers. A successful example was the ITMO Summer School organized for employees of the Bank to study technologies for working with big data in the financial sector — over 80 employees attended the course, 44 of them received advanced training certificates. One of the priorities of the Digital Academy in 2019 was to support the introduction of kanban as a method of managing the product delivery process which involved all IT and business units.
Significant attention, as in the previous years, is paid to the development of the Bank’s management team, which, in 2019, was performed according to the principles of a segmented approach: basic regular management, development of high potential managers, the knowledge management system of experienced recognized internal experts, and an individual approach to developing the potential of top managers. Over 170 executives were trained in management programs using an automated individual development plan. As part of the development of feedback, the Bank launched a project for “360 degrees” evaluation.
The personnel training system is being transformed simultaneously with the processes and structure of the Bank. Regular training programs acquire development and consistency; in response to business requests, new courses, seminars and assessment events start: from assessment to video courses, post-training chats, grocery marathons, and business games. In 2019, over 550 face-to-face training events were held; each employee, on average, completed 9 distance learning courses.
The Bank maintains awareness and involvement of the whole team through regular information campaigns. In 2019, they were dedicated to digitalization, information security, client-centricity of the business, principles of economy. Employees of the Bank with pleasure and excitement have participated in the digital dictation, in the Digifruits campaign. Almost all employees of the branch network responded to the contest My Favorite Client: each office vied with each other to tell its story about how to make a client happy with Bank Saint Petersburg.
Close communications and partnership principles of employee interaction are supported by the Bank through the organization of informal sports events. Over 70 people participated in the city SUP-festival, and the team of the Bank, under the leadership of the First Deputy Chairman of the Management Board Pavel Filimonenok, was recognized as the brightest. 50 employees participated in the Rautu trail cross-country race, and also the Bank’s employees participated in the White Nights marathon. Over 400 employees participated in summer corporate trips aimed at promoting corporate values and building team unity. The annual bowling tournament, dedicated to the International Day of Quality and Banker Day, brought together as many employees of the front line and the Head Office.
One of the priority areas for Bank Saint Petersburg is to devise efficient solutions that allow its customers to expertly manage their currency, commodity, and interest rate risks while maintaining and increasing the profitability of their businesses. Our extensive product range of speculative and hedging strategies for various market segments enables the Bank’s clients to select a solution that aligns with their price/earnings rate.
The Bank is actively developing for its corporate customers a comprehensive platform for hedging their market risks while constantly broadening its product line. For instance, the Bank entered into several oil and coal price hedging transactions in 2017. Among other highlights was a commodity swap transaction executed with one of the leading coal mining companies of Russia to hedge the power-generating coal price. The Bank successfully competes with the world’s leading investment and brokerage companies in terms of quality and price of its services.
In addition, the Bank is expanding its liquidity management product line intended for its corporate clients. The comprehensive range of new liquidity raising and placement solutions improves the efficiency of the customers’ money market transactions and enables the Bank to achieve a higher level of service quality and client loyalty.
The year 2017 saw the first currency swap transactions with corporate customers, resulting in RUB and USD placements at above average market rates. Such transactions now became a regular feature with a consistently growing number of clients involved. By the end of the year, the Bank launched a new product: foreign exchange swaps intended to raise RUB liquidity with foreign currency pledged as security. This instrument is particularly popular among export companies and other entities holding foreign currency account balances.
PROGRAMS TARGETED AT SMALL AND MEDIUM ENTERPRISES
Loans to small and medium enterprises are strategically important for Bank Saint Petersburg and allow SMEs to finance their working capital, purchase equipment, vehicles, real estate and other property required to develop their business, as well as to start new lines of business.
To grant financing to small and medium-sized businesses on preferential terms, the Bank actively interacts with specialized organizations within the framework of state support programs, including with MSP Corporation. Within its Program for stimulating lending to small and medium-sized businesses (Program 6.5) Bank Saint Petersburg offers attractive loans to customers at a rate of up to 10.6% for small and medium-sized enterprises operating in priority sectors of the economy.
Under the Program 6.5 and with security provided by MSP Corporation, Bank Saint Petersburg opened a RUB 40 mln credit line to KUZNECHNOYE Trout Farm. The farm is located in the offshore zone of Lake Ladoga and specializes in aquaculture of rainbow trout, ciscoes and sturgeons. Another example of successful realization of the Program is the RUB 30 mln loan to PTK BIK LLC, one of the leading manufacturers of full-color cardboard packaging in the Northwestern Region. In total, under the Program 6.5 the Bank entered into loan agreements totalling RUB 1.2 bn in 2017.
Boasting extensive experience of providing loans to agricultural enterprises, in 2017 the Bank was granted the status of authorized bank for the purposes of the agroindustry concessional lending program: the Bank’s customers can now apply for loans with a 5% interest rate.
The volume of the Bank’s loans granted to SMEs in 2017 amounted to RUB 96 bn.
As part of government support programs for small and medium enterprises and efforts to increase availability of investment and other loans, the Bank actively participates in the three-tier National Guarantee System (NGS) for guarantor institutions, comprising MSP Corporation JSC, MSP Bank JSC, and regional guarantor institutions (RGI). NGS participants through their joint efforts provide important and efficient support to SMEs, issuing guarantees and sureties to secure their loan obligations.
Bank Saint Petersburg signed agreements with MSP Corporation, the Small and Medium Enterprises Credit Support Fund Non-Profit Microcredit Company (St. Petersburg), JSC Small and Medium Enterprises Support Agency, the Regional Microlender of the Leningrad Region and the Guarantee Fund of the Kaliningrad Region. In 2017, Bank Saint Petersburg entered into NGS framework cooperation agreement with MSP Bank JSC, allowing its customers to take advantage of the full range of support schemes offered through the National Guarantee System.
Also in cooperation with MSP Bank JSC, in 2017 the Bank joined a targeted project to promote the businesses’ awareness of the available state support through MSP Business Navigator web portal.
Furthermore, in working with small and medium enterprises the Bank focuses on offering its customers an ever-increasing range of related services: legal, accounting, insurance, etc.
FOR EXIM COMPANIES
The Bank continues to develop new services targeted at ExIm companies: starting from 2017, corporate customers can automatically send SWIFT МТ 940, МТ 941 and МТ 942 statement messages through Internet Bank i2B. Russian representative offices of foreign companies and other organizations founded by non-resident entities must regularly provide to them financial reports according to the established international reporting standards. Internet Bank i2b has an in-built functionality which, once enabled, will automatically send out such reports with the required (daily/monthly) frequency. Financial information is transmitted via protected SWIFT channels directly to the parent entity’s bank. Foreign bank's consent to receive such statements must be obtained to enable the service.
In 2017, many efforts were directed at developing and implementing projects and services targeted at ExIm companies. The ExIm Office page of Internet Bank i2B was enhanced by the following new services:
- transaction report directory: a service allowing not only to view any transaction report managed by the Bank, but also to view the balance of payments for each transaction online;
- credits by non-resident entities: a service allowing to monitor proceeds credited by foreign partners either in Russian rubles or foreign currencies;
- online request for the bank control record with the option of receiving it through Internet Bank i2B.
PayHD Customs Card, a new product introduced in April 2017, is the essential instrument for fast, easy and safe customs payments.
Increasing the customers’ ExIm business expertise remains one of the most important tasks in supporting cross-border trade. The range of events held in 2017 spanned a total of 11 webinars dedicated to various aspects of foreign trade, 2 business seminars under the common title ExIm Dialogues organized for the Bank’s customers, and an open conference Foreign Currency Contracts in the New Economic Environment featuring guest speakers from the Bank of Russia and customs authorities.
The number of new ExIm contracts serviced by the Bank grew by 10% in 2017.
TRADE FINANCE OPERATIONS
Bank Saint Petersburg offers its customers a wide range of high-quality services related to documentary operations and international trade finance. The Bank continues to maintain and strengthen its positions in this market segment by supporting and expanding the list of its foreign contractor banks.
In 2017, Bank Saint Petersburg became one of the approved banks under the government-sponsored Russian export support program, allowing the Bank to offer low-interest loans to the exporters of manufactured goods, agricultural products, services, and intellectual deliverables of the telecommunications, computer and information industries. For these purposes, Bank Saint Petersburg and Russian Export Center JSC entered into an Agreement concerning federal budget subsidies for interest rates on export loans. Low-interest loans are offered to the Russian exporters as accounts receivable financing as well as to foreign companies and/or their banks for purchasing Russian goods.
The portfolio of transactions with JSC EXIAR (insurance company within the Russian Export Center) saw new additions, including the Bank’s first loan agreement with a foreign company with insurance coverage provided by EXIAR. The total loan amount is USD 100 mln.
Bank Saint Petersburg and AKA Ausfuhrkredit Gesellschaft have entered into an updated master agreement to finance import contracts of the Bank’s customers. The agreement sets the framework for long-term financing in the form of tied buyer’s credit with insurance coverage provided by Euler Hermes and other export credit agencies.
Promoting active trade finance relations with counterparty banks, Bank Saint Petersburg issued 7 guarantees against counter-guarantees of its correspondent banks with a total amount exceeding RUB 545 mln.
In addition, Bank Saint Petersburg and the European Bank for Reconstruction and Development have signed a new agreement stipulating general terms of guarantees issued in favor of the Bank under the EBRD’s Trade Facilitation Program (TFP). The new agreement will minimize the Bank’s payment risks related to accepting and honoring letters of credit issued by foreign banks in favor of exporter customers.
The Bank's trade finance and documentary operations in the reporting year were characterized by the growing number of foreign trade transactions: 351 in 2017 when compared to 267 transactions arranged in 2016 whose total volume nearly doubled (from USD 113 to 238 mln). At the same time, portfolio structure saw a shift towards a greater share of import letters of credit (114 transactions with a total of USD 57 mln compared to 70 transactions for USD 18 mln in 2016) as opposed to 2016, which was characterized by a more pronounced growth in the number and volume of bank guarantees.