Romeo COLLINA, CEO of "ATFBank" JSC:
"KAZAKHSTAN FOR US - IS A COUNTRY WITH HUGE POTENTIAL FOR BUSINESS DEVELOPMENT"

Rumours about forthcoming exit of investors from major companies and banks, even not confirmed subsequently, always puts the wind in these assets. Words of a kind were recently also about UniCredit "subsidiary" in Kazakhstan - ATFBank. In this regard "Interfax-Kazakhstan" Agency has addressed Romeo COLLINA, the CEO of Kazakhstani bank with questions about the plans of UniCreditconcerning ATFBank, and also about current situation in national economy.

- ATFBank is one of the biggest investors in Kazakhstan. Therefore, how do you estimate an investment climate in the country and what changes you can point out in this context working in Kazakhstan throughout several years?

- Kazakhstan is definitely on the way of recovering after the crisis. Now the effort is to have a sustainable economic growth in the medium term. As correctly identified by the President and his Government the effort should be focus on the diversification of the economy which at the moment relays just on oil, gas and commodities. Infrastructure, agribusiness manufacturing are just few examples of this diversification. Another point of attention should be on creating an industrial fabric where SME and Mid corporates become more and more the backbone of the local economy. We think these are definitely correct lines of activity. For our part, we support all initiatives of the Government, in particular supporting small and medium-size enterprises which we think could play an important role in stabilizing the economy and creating jobs.

In that sense our contribution could be more than just favorable interest rates. As you know ATF is part of Uni╤redit, an international banking group, number one in Central Eastern Europe. Our four core markets are Italy, Poland, Austria and Germany and particularly in Germany and Italy the economic success is built on the capability of SME and Medium Companies to be competitive in the domestic and above all in the international market with the right technology and high skilled staff. We are at their side as we we will be at the side of all the Kazakh companies who want to play a bigger role in the market with add value product. I think this is our contribution to a sustainable economic growth of the country.

When we decide to invest in Kazakhstan in 2007, we did it simply because we though that was a country with great potential. We still believe it as in the past and even more today.

- What is your medium-term forecast of the banking sector development in the republic?

- The banking sector definetly suffered during the crisis and it is on the way of recovering thanks also to the actions and measures implemented by the government. Still the major issue is the quality of the assets which prevents the banks to support the economic growth of the country. The Government and the National Bank are very well aware of this and are initiating projects and measures which could be beneficial to the banking sistem and to qthe overall economy of Kazakstan. The set up of a distressed assets fund is going in the right direction even if we should focus on the details and take the opportunity to implement some measure to speed up the process of restructuring the problematic loans . In particular these measures are in the legal and taxation areas.

- The results of investigation, carried out recently by the National Bank, fails to impress optimism in respect of bank loan portfolio quality, in particular, in retail credit sector. What is your opinion of this account, what should be undertaken on this occasion to restore a credit activity?

- According to National bank reports, the level of problem loan is still high, and many economists agree that it may turn to be as a problematic factor in the near future for the overall economy.However, in my opinion, the appropriate steps to improve the situation have been taken. The initiatives announced and to be implemented by the National Bank and Joint Stock Company "Samruk-Kazyna" are definitely in the right direction and above all we can count on the leadership of people like the Prime Minister and theGovernor of the Central Bank who are former CEO of local Banks.

- What kind of ATFBank forecasts regarding self-development in the near future, in particular in terms of market share, profits, assets?

- As I have mentioned, we consider Kazakhstan as a market with a great potential. Consequently we want to growth but in a very balanced way. The last increase of capital of 40 bln KZTis going in this direction. We don't have in mind a specific target in term of market share and ranking. We don't have the ambition to become the number one in the country. Our ambition is different: we want to be seen as a bank who is contributing to the economic growth of the country to the wellbeing of their citizen. As the fifth largest bank in the country with asa clients 300 thousand private individuals, 50 thousand SME entities, and approximately 2 thousand mid and larger companies we have a moral responsibility on us.At the end it is not to make a profit which counts but how we make it. It sounds strange for the Bank, but it is really what we working on. Answering to your question: yes on IFRS basis the risult will be much better this year comparing to 2010. The worst should be behind us.

- Has the Bank a plan to extend its activity outside the Kazakhstan?

- ATF is already part of an international banking Group with activity in 55 countries. Our goal is to put our customers in a position to benefit of our international presence and our experience in the international markets. On the other side we are more and more involved in supporting the effort of the Government to facilitate new foreign direct investments. Among our core countries there is also Germany where we own the third largest local bank HVB. We could be consider the link between this country and Kazakhstan, being our role in supporting financially the new initiatives and above all explaining the potential of the Kazakh market.

- There is the Russian bank "Sibir" in the ATFBank structure - what are your plans in terms of this asset, if the bank is not intent upon to widen its activity out of the country?

- As of the bank "Sibir" - we are not going to sell it to the outside investor. What we are planning at the moment - it is that the bank "Sibir" will become a subsidiary of Unicredit Bank Russia. At present we are working on it and it should be finalized by the end of the year.

- Are you planning to be in the capital market this year?

- At the moment we have not got such plans. We have sufficient liquidities and we do not see necessity to enter the capital market.

- The President N. Nazarbaev entrusted the government to work out the financial instruments to support the citizens who pursue to obtain a better education. May be for realization of this initiative is needed participation of the commercial banks. What contributions could ATFBank Kazakhstan make in this area?

- Education is what is making the difference in the medium term for the economy. Also in that sense we give our contribution in two areas. The first in the bank is through increasing the local content in the management of the bank. We are relying more and more on local people. As a matter of fact in the last 6 months we reduced the number of expatriates by 60%.

The second is in our products. We started in May a very interesting campaign called "Reshape the future of country together". This is a very aggressive campaign in the framework of which we finance obtainment an education by our customers at very low interest rates. At the same time we launch another initiative for the SME sector offering very low interest rates for those who will invest in new technology and hire new people. We are the first Bank to move in this direction and we are very proud of.

We are more and more convinced that new technology linked with better skills are the ingredients needed for a better growth for giving Kazakhstan the possibility to play an increasing role in the international market.

- Thank you for this interview!

May, 2011
й 2011 Interfax-Kazakhstan news agency
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May, 2011
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