Vnesheconombank published its interim condensed consolidated financial statements of the VEB Group for the nine-month period ended 30 September 2017 under IFRS.
«Fully abiding by the approved development Strategy, we are currently in the transformation stage, which we plan to complete in 2018. We are on schedule. This year we have focused our efforts, among others, on the “old” loan portfolio management, on profound change to the investment process, strategic projects financing. Of course, these measures do not produce an immediate effect: VEB Group’s financial result for the nine-month period is negative so far, which was mainly caused by provisioning within the “old” loan portfolio restructuring. However, there already are some positive interim results: funding structure is being optimized, interest expense on borrowed funds is going down; we see the Group’s equity increase.
The Bank is thus preparing to an active phase of investing in the approved priority areas. Under the development Strategy the new VEB will focus on financing of the projects in value-added industries, projects promoting new technology development, including National Technology Initiative. It is obvious that the use of new information technology is a pre-requisite for the efficient and competitive economy.
We also worked hard on the establishment of the Project Finance Factory, which is due in the first quarter 2018. We strongly believe that this instrument will boost the investment process and will make project financing one of the major drivers for the economic growth of Russia», - VEB’s First Deputy Chairman – Member of the Board Nikolai Tsekhomsky said.
Large-scale transformation of the VEB’s activity became possible thanks to a solid capital base.
- Group’s equity for the nine-month period went up by RUB 3.8 bn (+0.7%) to reach RUB 559.5 bn as at September 30 2017. The major contributing factors were subsidies from the federal budget (RUB 107.6 bn) and the Group’s financial result.
- Capital adequacy ratio (under RAS) amounted to 15,6% as at September 30 2017.
Total assets for the nine-month period 2017 equaled RUB 3.5 trl as at September 30 2017. The assets structure remained mostly unchanged, with the loans to customers (after allowance for impairment) amounting to RUB 1.77 trl. At the same time throughout the nine-month period quarter-on-quarter we saw a positive stable dynamics with regard to granting new loans. The amount of new loans in the nine-month period of 2017 was RUB 107.9 bn, exceeding by 46% that in the corresponding period of 2016.
Total liabilities for the nine-month period of 2017 went down by 2.5% to RUB 2.94 trl, primarily due to the decline in amounts due to the Russian Government and the Bank of Russia by RUB 47.8bn (-8.6%) because of partial maturity of the Federal Treasury deposits in Q3 2017, as well as the reduction of amounts due to banks by RUB 27bn (-4.2%).
Applications are now open for Vnesheconombank’s Development Award, an annual contest among investment projects. The awards ceremony will take place during the Russian Investment Forum in Sochi in February 2018 to recognise excellence in implementing projects of national importance.
The winners are selected in five categories:
- Best Infrastructure Project
- Best Industry Project
- Best Export Project
- Best Digital Economy Project
- Best Innovation Start-up (special category).
Aspirants can apply online on the contest’s website.
The Development Award is an annual nationwide contest established by Vnesheconombank in 2012 and held for the sixth time. This is a professional award in recognition of involvement in large-scale capital investment programmes and projects of national importance with a significant contribution to Russia’s socio-economic development.
The contest terms and conditions, the requirements for projects, contestants and project teams and the contest documents are available on the contest’s website.
Russian Economic Development Minister to Judge Vnesheconombank’s Million-Rouble Idea Game Show on NTV
Maxim Oreshkin, Minister of Economic Development of the Russian Federation, will be among the Million-Rouble Idea judges. Vnesheconombank’s televised game show premieres on NTV on 12 December. Start-ups will be competing to share a total of 60 million roubles in prize money.
Million-Rouble Idea, a game show featuring high-technology start-ups, will come out on NTV on 12 December. The three prize winners will be selected by the judges including Russian Economic Development Minister Maxim Oreshkin, Vnesheconombank’s Chairman Sergey Gorkov and Vnesheconombank’s Deputy Chairman and Member of the Board Alexey Ivanchenko, along with business leaders, the heads of development institutions providing support for high-technology start-ups and television celebrities.
“Entrepreneurs are those who take risks, generate new ideas and advance the Russian economy. I hope that the show will inspire start-up confidence, thus contributing to economic growth. There are special funds that select start-ups and young inventors with ingenious ideas and provide them with financing. I am sure that the game show will open up business opportunities for some of the contestants,” Maxim Oreshkin said.
Hosted by Sergey Malozyomov, the new television game show will feature 35 innovation projects in industrial production, information technology, pharmaceuticals, biotechnology and energy-efficient technology. The contestants presented a wide range of ideas and solutions that can become part of everyday life in the near future: portable cinemas, bionic prostheses, personal air conditioners, stroke risk tests and dozens of other start-up projects.
The Vnesheconombank-sponsored Million-Rouble Idea game show is intended to select the best innovation business projects. More than 500 start-ups applied for participation, and only 35 of them were longlisted. The first season of Million-Rouble Idea will begin on 12 December on NTV. For two weeks, the judges will evaluate start-up innovation and commercialisation. Seven projects will go through to the final of the show, three of them becoming the prize winners eligible for 25, 20 and 15 million roubles for business development.
State Corporation “Bank for Development and Foreign Economic Affairs (Vnesheconombank)” is a national development bank and one of Russia’s largest financial institutions. Established in 1924, the Bank has operated under the special Federal Law “On Bank for Development” since 2007. In accordance with the Development Strategy until 2021, Vnesheconombank will focus its activities on financing for high-technology industrial projects, infrastructure development, support for non-resource exports, support for innovations and projects of the National Technology Initiative.
VEB Innovations is Vnesheconombank’s subsidiary established to invest in high-technology projects. The Company’s principal strategic goals also include promoting innovation programmes of the Russian Government, creating the country’s innovation infrastructure, encouraging the use of foreign advanced technologies in Russia and helping Russian innovations to gain entry into the world market.
NTV is Russia’s largest private television channel with a nationwide broadcasting network. Founded in 1993, the television network operates six NTV-branded channels: NTV, a major nationwide television channel; three subscription-based thematic channels (NTV Serial, NTV Stil and NTV Pravo); international programming (NTV-Mir and NTV-America). NTV broadcasts in all Russian regions, has an audience share of 98.6% and traditionally ranks among Russia’s top three television networks.
Highest Award for Procurement, ‘Guaranteed Transparency’, Won by Vnesheconombank
The 11th annual awards ceremony for the 2017 National Procurement Transparency Rating took place on 6 December. The awards for procurement transparency went to the winning public, regional and municipal contracting authorities and corporate contracting entities. With the second highest score among Russia’s 70 largest corporate buyers this year, Vnesheconombank received the highest award, “Guaranteed Transparency”.
The ceremony was hosted by the Chamber of Commerce and Industry of the Russian Federation. Yevgeny Seleznyov, Senior Managing Director of Vnesheconombank’s Procurement Department, was given the award on behalf of the Bank.
“Our procurement system is in line with the development trend of Vnesheconombank Group as a whole,” Yevgeny Knyazev, Vice-President and Procurement Department Head, said. “Digitalisation helps us to reduce barriers to suppliers and contractors: we offer online training resources, introduce blockchain technology into the procurement process. The result of our efforts is recognised by not only industry experts but also small businesses, which is borne out by the fact that one in Vnesheconombank’s five purchases comes from a small business.”
The National Procurement Transparency Rating project was started 11 years ago to establish an independent non-governmental research centre specialising in economic and legal analysis of the Russian market for public, municipal, corporate and private procurement. The rating is based on the constant monitoring of contracting authorities’ procurement efficiency and transparency at federal, regional and municipal level. In 2017 the project’s research centre analysed 3,021,988 purchases made by public contracting authorities, totalling 6.45 trillion roubles, and 2,004,670 purchases made by corporate contracting entities regulated by Federal Law No. 223, totalling 39.21 trillion roubles.
Vnesheconombank also received the “Guaranteed Transparency” award for procurement in 2016. Last year, Vnesheconombank was ranked fifth overall in the category of government-linked companies.
State Corporation “Bank for Development and Foreign Economic Affairs (Vnesheconombank)” is a national development bank and one of Russia’s largest financial institutions. Established in 1924, the Bank has operated under the special Federal Law “On Bank for Development” since 2007. The highest governing body is the Supervisory Board chaired by Russian Prime Minister Dmitry Medvedev.
In accordance with the Development Strategy until 2021, Vnesheconombank will focus its activities on financing for high-technology industrial projects, infrastructure development, support for non-resource exports, support for innovations and projects of the National Technology Initiative. Vnesheconombank will reach a new level of quality: proactively searching for projects on the government’s list of priorities, working together with customers to thoroughly analyse business projects, attracting private coinvestors, using state-of-the-art technology to track the progress of projects.
Judges Selected for Vnesheconombank’s Million-Rouble Idea Innovation Game Show
Young entrepreneurs and inventors will present their projects to investors and business leaders. They will compete in a televised game show, Million-Rouble Idea, on NTV in December.
More than 500 applications were submitted for participation in Million-Rouble Idea. The projects were selected in five areas: information technology, biotechnology, energy-efficient technology, space and industrial production. The main selection criteria were scientific value, available prototypes, team qualifications and merchantability. The contestants are 35 start-ups longlisted for the prizes from Vnesheconombank.
Seven projects will go through to the final of the show, three of them becoming prize winners eligible for 25, 20 and 15 million roubles for business development.
The judges include business leaders on the Forbes list of Russia’s 200 wealthiest people in business: Alexey Repik, who founded R-Pharm, a pharmaceutical company; Dmitry Konov, Chairman of the Management Board of SIBUR, a gas processing and petrochemicals company.
On behalf of Vnesheconombank, the game show will be judged by Chairman Sergey Gorkov and Deputy Chairman and Member of the Board Alexey Ivanchenko, who supervises the Million-Rouble Idea project.
The heads of Russia’s major investment funds took an active part in evaluating the projects submitted for the show. Therefore, any start-up eliminated before the final can find the deal of its life. For example, one of the judges is Alexander Galitsky, Managing Partner of Almaz Capital, who pioneered Wi-Fi and VPN networks. He was honoured as the most influential person in the Russian IT industry by Forbes in 2011. Among the judges are Alexey Konov, Managing Partner of RBV Capital; Arkady Moreynis, who founded Glavstart, a start-up business factory, and Price.ru, a comparison shopping engine; Sergey Fradkov, Managing Partner of iDealMachine, a venture capital fund and start-up accelerator.
The contestants will be evaluated by business leaders: Leonid Kazinets, Chairman of the Management Board of Barkli, a development company; Vitaly Yusufov, Chairman of the Board of Directors of IcomInvest, a telecommunications company.
The game show will be judged by the heads of development institutions providing support for high-technology start-ups: Alexander Chernov, Senior Vice President of the Skolkovo Foundation; Svetlana Chupsheva, General Director of the Agency for Strategic Initiatives; Mikhail Mamuta, Head of the Service for Consumer Protection and Financial Inclusion of the Bank of Russia; Eldar Muslimov, member of the Supervisory Board of the Monotowns Development Fund.
The judges also include Russian celebrities: TV show hosts Tutta Larsen and Tatiana Gevorkyan; radio presenter Sergey Stillavin; actor and television and radio presenter Oskar Kuchera; singer and car customisation shop owner Denis Klyaver. They will be attentive to the practical application of presented inventions in everyday life.
“A contribution to the development of an innovative economy, a search for new ideas and their subsequent implementation are the goals of the Million-Rouble Idea show. As a development institution, Vnesheconombank finds it important to popularise the image of people and the opportunities of this country. We have a willingness to invest in the future,” Alexey Ivanchenko, Deputy Chairman and Member of the Board of Vnesheconombank, said.
“Million-Rouble Idea is a kind of guide, providing an opportunity to get answers from potential investors and development institutions and receive assistance with start-up promotion,” Svetlana Chupsheva, General Director of the Agency for Strategic Initiatives, said.
“This show can give money to start-ups and can open up investment opportunities. The economy or, even more, the country will be given the confidence and hope that we have good prospects, really good. To be an entrepreneur should be respected. There is nothing improper in entrepreneurship,” Alexander Chernov, Senior Vice President of the Skolkovo Foundation, said.