Strategy

The Bank’s strategy for the next five years is to continue its expansion in the Ukrainian banking sector through a combination of organic growth in its key customer segments (corporate, including SMEs, and retail) in the geographic regions where the Bank is already present and in other targeted regions in Ukraine.

The Bank’s strategic objectives are:

  • to maintain and strengthen its position in the SME market (small companies with a maximum of 100 employees and UAH 10 million per year turnover and medium-sized companies with a maximum of 1,000 employees and UAH 50 million per year turnover);
  • to focus on large and medium-sized corporate customers in the main sectors of southern Ukraine;
  • to maintain a broad diversity of corporate customers in terms of both geography and industry sector;
  • to develop and broaden the product range offered to corporate customers;
  • to seek to attract new high net worth and professional retail customers;
  • to expand its distribution network;
  • to develop its range of retail banking products with residential mortgage loans, car purchase loans and credit cards;
  • to use alternative sales channels for retail banking products through its customer support services and;
  • to promote brand image and product lines.

To grow its Corporate Banking business

The Bank plans to develop and grow its corporate banking business by continuing to focus on large and medium-sized corporate customers in the main business sectors of southern Ukraine such as trading, food-processing, production of beverages, shipping, stevedoring, ship – building, communications, transport, construction, as well as on growth industries such as cash and carry and home shopping networks, food production, and agriculture.

The Bank will also seek to maintain a broad diversity of corporate customers in terms of both geography and industry sector to achieve more stable funding. The Bank will seek to grow its corporate customer base by continuing to develop and broaden the product range offered to corporate customers, in particular by offering its corporate customers individually tailored lending products and by effective implementation of cross-selling techniques. In addition, in 2005, the Bank launched lending products for SMEs to facilitate its entry into this segment of the market.

The Bank also intends to develop further its advanced credit products (including syndicated loans, structured finance and international trade finance) in co-operation with the Bank’s branch network, its subsidiary bank, Regional Investment Bank, located in Riga, Latvia (RIB), international banks and financial institutions. The Bank is also considering acquiring additional subsidiaries in EU countries such as Bulgaria and Romania.

To grow its Retail Banking business

The Bank intends to increase its share of the retail banking market in Ukraine. The Bank will seek to attract new high net worth and professional retail customers by offering a wide range of banking products through its expanded distribution network, and by developing various partnership and loyalty programmes for those customers. In particular, the Bank plans to develop its range of retail banking products with residential mortgage loans, car purchase loans and credit cards.

The Bank also intends to make its car loans more flexible in terms of maturity, fees and repayment schedule. In addition, the Bank plans to introduce additional personal banking services, which would allow the Bank’s most important customers access to the Bank’s services at any time. The Bank also intends to expand its client base through joint marketing efforts with its existing corporate clients by offering banking services to the customers of the Bank’s corporate clients.

The Bank will also focus on providing services to high net worth and professional retail clients, mid-level customers, and their family members by using alternative sales channels for retail banking products through its customer support services such as its call centre, telephone banking, internet banking and other client relationship management (CRM) technologies.

The Bank’s call centre offers clients access to the Bank’s services 24 hours a day, seven days a week. The Bank is also implementing a mobile offices project. In addition, the Bank is targeting growth of retail deposits to a maximum of approximately 55 per cent. of its total deposits by the end of 2010.

To widen existing and create new distribution channels

The Bank is pursuing the growth of its customer base and its loan and deposit portfolios by expanding its network in the most economically developed and heavily populated regions of Ukraine.

The Bank plans to expand its distribution network to approximately 200 branches and outlets in the next few years. New branches will target both corporate and retail banking customers and smaller outlets will mostly target retail banking customers. The Bank intends to focus heavily on training the staff it recruits for these new branches and outlets in order to provide a consistently high standard of customer service.

The Bank also intends to increase its network of automated teller machines (ATMs) and expand its participation in its partners’ ATM networks to cover all regions of Ukraine with a specific focus on economically developed and heavily populated regions. In particular, the Bank increased the number of its ATMs to 160 by the end of the year 2007 and plans to further increase this to over 200 ATMs in the next few years. In addition, the Bank will increase its ATM capability by providing for a fuller range of services to be available through its ATMs. The Bank was the first in southern Ukraine to install deposit ATMs.

The Bank is expanding its telephone banking system called GSM-Banking (GSM Banking) (which allows customers to review their accounts and access information via an automated telephone banking system) and internet banking services to make a variety of banking products available on-line, including effecting payments and money transfers. The Bank’s Management plans to increase the Bank’s co-operation with strategic partners (for example, mobile communication operators) to use their points of sale for acquiring new clients and offering certain banking products.

To promote brand image and product lines

The Bank is implementing a network — wide corporate branding strategy in order to broaden public awareness of the Bank. The Bank is actively promoting its brand and product lines via intensive marketing to existing and new customers through the targeted use of printed and broadcast media advertising. The Bank will also seek to enhance its profile by using alternative advertising media such as direct e-marketing to potential customers and web advertising.

The Bank’s corporate branding strategy is also being used to give its branches a consistent corporate style, thereby enhancing the Bank’s corporate image. The Bank actively participates in various charities and community projects and is founder of a charitable fund that supports educational, scientific and research activities of Odessa State Economic University. The Bank plans to continue its sponsorship initiatives, and to extend the variety of its charities and community projects that it supports.