VAB Bank boosts charter capital by 27%

Kyiv, June 13 (Interfax-Ukraine) - VAB Bank (Kyiv) is increasing its charter capital by 27.1%, or by UAH 500 million, to UAH 2.349 billion, through an issue of additional shares, Board Chairman Denis Maltsev has said.

"The bank's shareholders at a general meeting on June 13 approved the results of the next issue of UAH 500 million," he said at a press conference at Interfax-Ukraine on Wednesday.

According to Maltsev, after the additional share issue none of the bank's shareholders will own over 10% of the shares.

According to the banker, this is the second increase in the charter capital in 2012: Previously the bank registered an increase of UAH 600 million, or 48%, to UAH 1.849 billion.

According to Maltsev, VAB Bank plans by the end of this year to hold another additional share issue worth UAH 500-600 million. He added that the increase in the bank's charter capital is caused by the bank's plans to increase crediting. The bank plans in 2012 to increase its assets by 70-80%, and expand its loan portfolio by 70%.

Among the priorities for lending the banker named the agroindustrial sector.

According to him, in 2011 the bank provided the agricultural sector with loans of almost UAH 1 billion. By the start of this year, the share of loans to agricultural producers in the bank's loan portfolio was 20%, and by the end of this year it could grow to 50%.

"Our strategic goal is to become bank number one in lending to farmers. We plan to achieve the goal in the next two years," he said.

He also said that the bank plans by the end of the year to reduce the share of bad credits, which appeared due to the inability of borrowers to repay them during the financial crisis, to 10% - down from 14% - of the total loan portfolio.

According to the banker, the bank plans in 2012 to earn a profit.

He also reported the bank is realizing the program of optimizing the regional chain: all bank branches became universal, serving both retail and corporate clients, whereas previously they were specialized. This project allowed the bank to reduce operating costs by 30-35%, the banker added.

Maltsev also said the bank had closed five unprofitable offices in the past one-and-a-half years. Currently their total number amounts to 137, which he said was the optimal level.

As reported, VAB Bank in 2011 increased its total assets by 37%, to UAH 9.1 billion, its credit portfolio was up by 17.6%, to UAH 6.4 billion.

VAB Bank has been working on the financial market of Ukraine since 1992.

Ukrainian businessman Oleh Bakhmatiuk in early October 2011 announced the conclusion of an option agreement to buy a majority stake in Kyiv-based VAB Bank. In November 2011, the Antimonopoly Committee of Ukraine permitted Quickcom Limited (Nicosia, Cyprus) to obtain control over Kyiv-based VAB Bank.

According to the National Bank of Ukraine, as of April 1, 2012, in terms of total assets (UAH 11.311 billion) VAB Bank ranked 20th among the 174 banks operating in the country.