With the current level of rates, we risk killing the economy

Banking length Professor Fallico - Twenty-something years, more than half of independent life. In 1987 he began working as a consultant, "Bank Catolica del Veneto, and in November of 1995 he moved to Moscow as head of Banco Ambrosiano Veneto. The choice of the host country was not accidental: in 1981, and 1989, Antonio Fallico worked as a consultant to the Italian State Committee for External Economic Relations of the USSR, learned the Russian language, has gained a lot of important and useful links. In December 2003, Fallico headed ZAO Bank Intesa - first subsidiary bank group "Intesa" in Russia. After purchasing the team in 2005, controlling KMB BANK Antonio Fallico became chairman of the board of directors and the bank. Charming, emotional, mild-mannered and attentive look clingy, Professor Fallico answered questions "experts." The financial crisis in Russia continues two and a small quarter. What changes have evolved the strategy and tactics of the bank in a new, stressful operating environment? Of course, we can not say that we do not notice the crisis, but due to traditionally conservative policies as a whole group "Intesa Sanpaolo", and both of its subsidiary banks in Russia - KMB Bank and JSC Bank Intesa, we do not see much change in our activities. Large corporate borrowers have paid us in full. With regard to the retail segment, especially small businesses, the level of overdue loans, of course, increased, but remains at less than two percent of the portfolio - that's less than the whole of Russian banks, and smaller than the average for the thirty largest banks. Already 70 percent of all problem loans, we have restructured in a very realistic conditions. Today there are two options for debt restructuring. The first - is to increase the loan term and, consequently, a decrease in monthly payments of clients. The second option - the ability to pay only interest on the loan for some time. What was the dynamics of KMB Bank's loan portfolio in recent years and what you plan to gain credits for 2009? In the first ten months of 2008, we have noted high rates of growth of credit portfolio, and in the period from November to January, we observed a fall in demand for loans. Thus, indicators of loan portfolio by the end of last year, comparable with the level of the end of October. For 2008 the total loan portfolio of KMB Bank grew by 71 percent. Rates on ruble loans grew strongly and the demand for foreign currency loans fell by uncertainties in the ruble exchange rate. Therefore, we have seen a decrease in loans during the last quarter of last year. Starting in February of this year there has been a positive trend and we expect that in March and April the demand for credit products begin to rise again. I find it difficult to give an accurate forecast of growth of our loan portfolio by the end of the year, but I think that the funding of major clients will continue. The more so because a number of credit lines, "Intesa Sanpaolo" for Italian companies - suppliers of equipment and services for the project to build a gas pipeline "Nord Stream" at a rate of 85 percent guaranteed by the Italian government agency for export credit insurance SACE. At the same time, consumer credit, we will see in 2009, some reduction in the rate of growth of our portfolio. You bind a deceleration of growth of loans to Russian borrowers with only a sharp jump in prices in the credit crisis? And you as the lending bank tightened the procedures of selection of borrowers? Naturally, we became even more attentive. If there are no specific safeguards, we do not issue credit. We continue to lend to small and medium-sized firms, but more cautiously. Nevertheless, for the old customers of the SME sector requirements for collateral loans were not reviewed. We have not abandoned plans for development. Already in the first months of this year, KMB Bank opened three new offices - in Krasnodar, Omsk and Ufa. Where do you get funds for development in time of crisis? Does your parent resource group? Naturally, we feel more confident, knowing that behind us there is such a powerful group as the "Intesa Sanpaolo, which is ready to support us. But the resources for the expansion, we derive from our own sources of revenue. KMB Bank remains profitable in 2008, although the amount of profit fell by about 50 percent. This is primarily due to an increase in operating expenses to expand its regional network, opening new outlets and upgrading of existing units. In addition, the bank continued to implement strategic investment projects, primarily in information technology, risk management and development of sales channels. Means the parent group we hire to support our liquidity in long-term credit lines for a year and five years. But the dynamics of our market-based liabilities inspires certain optimism. In August and September last year we saw an outflow of funds as from private deposits, and from current accounts of legal entities. But in recent months last year, we noted a gradual increase in the amount of funds on deposit and current accounts. This trend was also noted in early 2009. Financial support from Milan enough to not use costly refinancing loans and securities borrowing in the interbank market? Our own resources and loans from the parent group can maintain a good supply of liquidity. Bank loans, we use a very limited extent, and the most expensive unsecured loans do not use. On the interbank market before the crisis, and now KMB Bank operates primarily as a lender and not the borrower. The terms of our contractors - the biggest banks in the top ten. Rules and procedures for risk management are the same for all banks in the group "Intesa Sanpaolo"? There is a chance to get a loan at your bank for an Italian company with a turnover of EUR 10 million and the similar Russian companies the same? Yes, the same. But, of course, the rates of these loans will be different. We must consider the risks to a specific country. As regards the requirements for collateral, guarantees and so on, they all are the same for all of our customers in Italy and other countries. Tips stranger How would you rate policy of Bank of Russia to counter the crisis? What measures are still needed, in your opinion? The critical moment of crisis in the Russian banking system was broken in October-November last year, and only thanks to a timely and very energetic actions of your government, the Central Bank and the State Duma. The result of these efforts was the fact that Russia has avoided the collapse of the banking system, and hence the entire economy. However, the negative trends associated primarily with the deterioration of asset quality and, consequently, with increasing pressure on banks' capital, there are today. These processes are not unique to Russia and its banking system. We see how seriously reduced the capitalization of the largest banks in America, significant difficulties experienced by many European banks. The Russian government and Central Bank, of course, aware of the nature and extent of the problems. Proof of this can be used including the recent remarks of officials with forecasts of growth of overdue debts of companies to banks. Ongoing efforts to support the key companies of the Russian economy can hope that the scale of arrears will not receive catastrophic proportions. Nevertheless, additional actions of the government and the Central Bank to support the capital of the banking system could certainly create a greater safety margin and thus consolidate the gains already made to stabilize the financial sector. If we talk about the shortcomings of the Russian banking system, we think it is very harmful presence of so many banks with microscopic capital less than five million euros. Russian banking sector badly needed consolidation. I do not think that small banks will survive the crisis. But for the system solution consolidation of the sector requires political will. And the same system. Here by one of the Central Bank can not cope. Deputy chairman Andrei Kozlov has launched a job five years ago, but was killed, as you know. Yes, it's a tragedy. Nevertheless, the task of consolidating the Russian banking sector needs to be solved. The task of stabilizing the currency market and the ruble is solved in the rough. Is it time to start the Central Bank to cut interest rates? It is obvious that the rise in interest rates by the Bank of Russia was reasonable and justified. These actions were aimed at preventing the uncontrolled development of the devaluation of the ruble and, as we see, have proved effective. Indeed, high interest rates reduce the attractiveness for borrowers, and we are already seeing the negative impact of this factor on the growth dynamics of banks' loan portfolios. But in a situation of this large-scale global economic crisis, the Central Bank is forced to make decisions on the principle of choosing the lesser of two evils. In my opinion, the Bank of Russia has competently. Now, when it was the stabilization of the ruble exchange rate and a pronounced normalization of interest rates, it is hoped that the Central Bank would revert to the issue of easing interest rates. In fact with the current level of rates, we risk killing the economy. I am convinced that such a move would provide an additional incentive for banks to expand lending activity. Bond Tremonti: response to competitors How much hit by the crisis of Italian banks? Italian banks, in contrast to most American and British, were relatively stable during the crisis. They do not show loss of income only slightly decreased compared to previous years. A distinctive feature of Italian banks is that they have little recourse to borrowings, have their own extensive local network, attracting funds from the public. In fact, in Italy, is developing a model of the traditional banking business, which is based on the private lending on the curb risky securities in the portfolio and the prevalence of credit operations of financial. The latter are always performed on the residual principle, to reduce dependence on risky assets. According to recent estimates the head of the Bank of Italy Mario Draghi, the assets of the largest Italian banks in structured financial products occupy less than two percent. As a joke says our Prime Minister, Mr. Silvio Berlusconi, the Italian banking system has suffered less than the U.S. because the Italian bankers do not know how to speak in English. Nevertheless, declared a state aid program by Italian banks by the government. Why would she want to do if, as you say, the situation is far from a crisis? State assets most Italian banks do not require urgent government intervention, they are well capitalized. Nevertheless, given the changing conditions of competition as a result of significant government measures to rescue and support banks in the U.S. and Europe, Italian banks now have to use all available means to maintain and possibly strengthen its capital base. It is these aims is a program of state support healthy banks so as to facilitate lending to the economy. Ministry of Economy and Finance of Italy in late February said it would buy the special bonds emitted by the banks, totaling 14 billion euros if you use the proceeds for lending to the economy, including small and medium businesses. These bonds, called bonds Tremonti (on behalf of Finance Minister Giulio Tremonti. - "Expert") are issued for a period of three years, with a yield of 7.5 percent per annum. They can be regarded as a kind of insurance policy that is issued in the face of uncertainty regarding the duration of the current crisis. Leadership of the largest Italian banks such as Banco Popolare "," Intesa Sanpaolo "," Unikredito "," Monte dei Paschi di Siena ", has already expressed its willingness to participate in this program. However, while they show some caution, since they are not satisfied with the scheme of control over the expenditure of funds so received. Bankers opposed to representatives of local authorities, prefectures, pointed to the bankers, who give credit, but who does not. The preferred option is to oversee the means of state was carried out by regional representatives of the Bank of Italy. I hope that this will reach a compromise between the government and the banking sector. Proud Argued that the banker - this is a boring job, something like an accountant: you are bound hand and foot treatments, risk management. You have all painted: step right, step left - to escape. Where is the scope for creativity, entrepreneurial energy, the risk teykinga? Probably from you might think that we are machines, robots who can just take the money and standards. In fact, in the banker's very important the human factor. And intuition. I have to believe in its borrower, in his business and his project, otherwise I would not lend him money, even if all formal requirements for the loan application are met. And of course, very interesting to solve unusual and complex task. Let's say I had experience in organizing large syndication for the project "Blue Stream". Our small for such projects the bank was able to attract partners and funding to organize a major gas pipeline construction. It is worth considering that under the Black Sea is pipe on it goes smoothly and gas is made possible also thanks to my participation - and I feel pride and enthusiasm.