Head of the state VTB bank Andrey Kostin wants to get a "five" from the rating agencies. To this end, he proposes to alter the ratings. The head of the board of the state bank VTB, Andrey Kostin, at the Sochi Investment Forum announced that VTB Capital quits from Analytical credit rating agency and is looking for a buyer for its stake. Mr. Kostin's main claim against the ACRA analysts is the low rating, obtained by his bank. His frustration is understandable: the bank just got rid of the allegedly "biased" assessments by the international rating agencies, put its faith into "our own guys", counting on the highest mark. And "our own guys" turned out to be even more critical.
"We are not satisfied with the methodology they use, because they have the rating even lower than the Western rating agencies to which we have complained because of their politicized approach," Mr. Kostin said.
At the same time the head of the bank said he intended to address the Central Bank to give the Russian financial institutions an opportunity to use the services of the agency of their own choice, from two to three. Not to a single one, where all are "herded to be rated." At the end of January it became known that VTB declined to disclose the rating, given be the analysts of ACRA. According to sources, the State Bank management allegedly was not satisfied both with the estimate itself, and the support of this evaluation.
Today, the accreditation of the Central Bank was given to just two rating agencies: ACRA and Expert RA. But Mr. Kostin seems to be dissatisfied with both of them. Although in the beginning of February this year, Expert gave VTB the highest rating on the national scale credit - "A ++" with a stable outlook. However, the claim against Expert RA was expressed by Mr. Kostin with a very vague wording: "There are certain nuances with it, the topic has not yet been fully clarified."
"Post" weak link
Persons familiar with the situation suggested that the head of VTB may by disturbed by the rating of Post Bank, which is included in the VTB financial group. Today, for the bank to have the opportunity to place the funds of private pension funds, it must have a certain rating, which can be given either by ACRA, or one of the international rating agencies. The rating must be no lower than Russia's sovereign rating lowered two notches. Both VTB and VTB24 have sufficient financial indicators. In particular, the former was assessed by Moody's as «Ba1», by Standard & Poor's as «BB +»; to the latter Moody`s assigned a rating of "Ba2".
But "Post Bank" brought disappointment. The experts, including representatives of the largest NPF, who wished to remain anonymous, believe that the Bank may well fail to get enough points to place pension funds. As explained by one person familiar with the situation, "Post Bank" is a "beginner", which require large amounts of financial investments. At the same there are no credit ratings for the bank, and, consequently, it has no right to use the money of the pension funds to replenish its capital.
By the way, it's not the first time Andrey Kostin uses the strategy of "fleeing" from the bad ratings. He previously declared unprofessional the agencies that didn't satisfy him. So, in the beginning of 2014, Vneshtorgbank refused the services of a reputable rating agency Ficth. This was preceded by a lowered long-term issuer default of VTB to BBB- level. Before the rupture of relations the agency once again confirmed the rating of the bank at this level. It seems that Mr. Kostin is worried not so much by the actual reliability of the bank he heads, but rather a good estimate. Moreover, if the score is lower than expected, it is easier to change the agency.
Will the new owners fire Kostin?
There are rumors that the leadership of VTB diligently "skimp" preparing for the privatization of state-owned bank, actually trying to disrupt it. Experts say the bank's activities are ineffective. According to the persons familiar with the situation, the bank is still afloat due to the constant budgetary injections. Only in 2015, VTB received a federal loan bonds worth 307 billion rubles. It would be possible to understand the sabotage of the top management of the state bank (if it takes place) in one case: the new owners wish to thoroughly understand the conditions and the bank's finances, and may become unhappy. So unhappy that Mr. Kostin may see his wage cut back. And then he would be close to dismissal.
And the salary of the head of state bank is still notable: Kostin's income in 2013, for example, amounted to 37 million dollars. According to Forbs magazine, Kostin then became the highest paid top manager of Russia. At the end of 2016 Kostin had the 3rd place in the same ranking. However, his salary was not indicated; it was only known that all top managers VTB had to divide 6.1 billion rubles. Forbes then was suspected of "mashing" the data, and publisher of the journal Alexander Fedotov - of meddling in editorial policy.
Despite the stable salary, Mr. Kostin manages the state-owned bank not quite brilliantly. For example, as of June last year, the financial institution was in the lead in terms of non-core assets: VTB had 542 billion rubles of them, which is 38% of the capital of the banking group. Basically, we are talking about real estate transactions. But the transactions with non-core assets bring, basically, only losses. For example, in 2012 the state bank lost 4.3 billion rubles in this way, over the next two years it lost 17.4 billion rubles, and in 2015 as much as 35.9 billion rubles!
Despite the high salaries, the top managers of VTB do not disdain theft. Note that in 2012, started the trial aganinst the former head of the Novosibirsk branch of the State Bank Vadim Grigoriev. The top-manager, as suggested by the investigation, managed to withdraw more than one billion rubles. Later, among the defendants in the case also appeared to be the Grigoriev's deputy Irina Dolgova and several other bank employees.
Fighters with corruption are interested in the fact that the money was stolen not once, but over two years. However, the head of VTB management managed to "not notice" that the bank lost money, which by the way, were withdrawn through lending to knowingly insolvent enterprises. By the way, a fire in the Tagansky Court of Moscow that erupted at the end of 2015 also looks suspicious. It burned the files with the cases of theft of $1.2 billion from VTB. Rumor has it that the fire did not occur by chance, but among the "beneficiaries" of fire could be not only the leadership of VTB, but also the fugitive banker Sergey Pugachev.
It is possible that the state bank management also "earns" on banal "carve ups". Everyone remembers the story of the procurement of oil rigs by Vneshtorgbank. In 2009, the founder of Anti-Corruption Foundation, Alexey Navalny, published an investigation about the details of the purchase of the Chinese drilling rigs by VTB. The bank purchased 30 drilling rigs ZJ50DBS from the Chinese company Sichuan Honghua Petroleum Equipment Co.Ltd.; but the top-managers didn't buy them directly, preferring to use a Cyprus "mediator" - but at the price of 15 million dollars apiece. "Extra cost" is clearly not difficult to find. It is clear that the desire to improve the rating of the banking group at the expense of the "pressure" on the rating agency may not be a sign of a good manager. Russia has enough competent financiers. Maybe Kostin has already stayed too long?