Top Interest-rate risk Interest-rate risk management of is aimed at minimizing the negative impact of fluctuations in interest rates on Bank margins. The main objective of interest-rate risk management is to ensure that the bank achieves an interest margin (the difference between interest obtained from interest-earning assets and interest costs on interest-bearing liabilities) that is sufficient to cover operating costs and ensure profitable operations. The bank does not consider interest-rate risk as a source of additional income and does not increase it in response to market expectations. Bank vozrozhdenie reacts quickly to any changes in the overall level of interest rates and adjusts current base rates on funds received and allocated to meet its targets for interest income. The bank has an internal transfer pricing mechanism for resources. Prices for cash resources within the bank (purchase and sale of cash between internal divisions) are regulated in accordance with the situation on the short-term capital market. This encourages internal divisions to structure their assets and liabilities in a way that ensures that interest-rate risk is liquid and profitable.
Risk management and control systems, annual, report 2015
Limits are set for each issuer of financial instruments based on the volatility and liquidity of its securities. The volume and structure of the securities portfolio is considered not only as an income source, but also as a tool of current liquidity management. Limits on the interbank market lines are set according to the financial standing of a counterparty. Decisions on managing market risk are made by the Assets and liabilities Management Committee. It defines the volume and structure of the securities portfolio by assessing the quality of the securities based on capacity to generate income and maintenance of the necessary liquidity. The banks market risk is subject to regular stress tests. Bank vozrozhdenie carries out transactions with stocks (local shares, adrs and gdrs of Russian issuers although this is not a primary business. The bank manages its equity risk mainly by establishing and adhering to limits on investments in stocks. Given the limited investments and absence of transactions involving derivatives, the bank considers the methods set out in Central Bank regulation. 313-p, on the Procedure for Calculating Market Risk by Credit Organizations (dated 14 november 2007) as sufficient for calculating risk on the trading portfolio.
Procedure for creating provisions against losses on loans and other operations. Procedure for transferring npls to the department for Legal Enforcement of Payments and completing follow-up work with them. Procedure for determining and controlling the authority for issuing loans by branches and management bodies within the bank according to loan size. In 2010, the bank carried out work to implement a risk management strategy in accordance with the Action Plan approved by the management board: Options for further developing the front-office system and automating the collection of initial information to implement a credit rating system were considered. A methodology for calculating capital at risk on the loan portfolio was devised. A new edition of the regulation on Stress Testing was approved. The methodology for creating provisions for corporate loan portfolio impairment according to ifrs was updated Top Market risk The bank distinguishes the following types of market risk: currency risk (operations on the forex writing market interest-rate risk (bonds) and equity risk "d shares). Each of these is treated separately by the bank.
Bank vozrozhdenie pursues a balanced policy for provisions against losses on loans, equivalent debt and other nashville operations, in accordance with branches internal documents. Control over creating provisions on products bearing credit risk is carried out at the branch level and by the relevant internal divisions of Head Office: the Credit, retail, and Bank card departments. Overall supervision is provided by the department for Credit Risk control, and day-to-day control is the responsibility of the Internal Control and Audit Service. Bank vozrozhdenie has developed and implemented policies and procedures to avert and minimize losses arising from credit risk. The following procedures have been introduced: Mandatory regular assessment of the financial standing of borrowers and the economic effectiveness of events and projects. Assessment of the adequacy and liquidity of collateral, objective evaluation of collateral and its insurance by appraisal and insurance companies accredited by the bank. Ongoing monitoring of the borrowers fulfillment of his obligations to the bank and the actual existence of the collateral. Assessment of credit quality and the level of risk associated with loans.
In the case of consumer lending, the bank analyzes a borrowers financial standing, sources of income and credit history. Preference is given to the following types of clients: Staff and managers of large corporate clients of the bank. Cardholders and depositors of the bank, people with proved high incomes, a high social status and a decent reputation. Clients who regularly use bank services to make payments. Clients with a good credit history at the bank. To obtain loans from Bank vozrozhdenie, borrowers should offer collateral in adequate and sufficiently liquid form. When accepting real estate as collateral against a loan, the bank uses a system of discounts for all types of property. Security provided for loans is subject to mandatory regular reviews for adequacy and liquidity.
Annual report of the general Services Department, risk
The subcommittee on bank cards is responsible for managing credit risk and implementing credit policy when offering bank cards that carry credit risk. The subcommittees and managers responsible for individual lending are empowered to make decisions about accepting credit risk that restrict the maximum amount that a debtor can borrow. As part of their authorization of decisions about lending, the subcommittees liaise with the corresponding subdivisions of the head Office (Credit, retail and Bank cards departments). Last year, to minimize credit risk and ensure that sufficient provisions for the loan portfolio are in place at all times, the department for Credit Risk control became one of the bodies that must approve loan applications from branches. The authority to disburse loans and set other types of lending limits and conditions is approved by the management board and are subject to quarterly review. As of the first quarter of 2010, the bank authorizes branches to issue loans independently if they meet certain criteria for the level of NPLs and returns on their financial and economic operations.
Alongside the system of authorization and decisions, bank vozrozhdenies methods for managing credit risk include personal a centralized system for setting water and regulating interest rates and tariffs, as well as a system for limiting credit risk. In addition to the overall limits, the banks credit policy sets planned qualitative and quantitative targets that determine the structure of the corporate loan portfolio by segment, sector and region and the structure of the loan portfolio in terms of currency and duration. When lending to legal entities and individual entrepreneurs, preference is given to small and medium-sized enterprises. Priorities when providing clients with products carrying credit risk are also dependent on: The importance, profitability and creditworthiness of a client for the bank. The clients business sector, the banks regional policy, the amount, type, form and purpose of the loan requeste. The business activity of a client who has received a loan is constantly monitored by a branch of Bank vozrozhdenie and, where necessary, by internal divisions of Head Office: the Economic Security service and Legal Department.
To evaluate risks, the bank uses the following key indicators: Capital at risk — the maximum possible losses associated with the main types of risk. Economic capital — the capital necessary to cover overall risk, including potential and materialized. Raroc (Risk-Adjusted Return on Capital) — the return on economic capital, calculated as the ratio of net income to economic capital. Bank vozrozhdenies business is exposed to a wide range of risks, the most significant ones in terms of potential losses being: credit, market, liquidity and operating risk. Credit risk, bank vozrozhdenie defines credit risk as the risk of losses due to non-fulfillment, delayed or incomplete fulfillment by a debtor of his financial obligations, as stipulated by a credit agreement.
The bank assumes credit risks in lending operations with all types of counterparties (corporate clients, financial organizations and individuals). Efficient credit risk management is a priority in the course of the banks business. Bank vozrozhdenie has a system of authorizations and limits on products that carry credit risk. The bank has established a Credit and Investment Committee (cic which is responsible for managing credit risk efficiently and consists of various bodies and subcommittees: The cic main body is responsible for general issues relating to managing credit risk and defining and implementing credit policy as part of the banks approved development. The cic minor body deals with issues relating to implementing credit policy when offering products that carry credit risk to clients and when making investments. The subcommittee on corporate clients is responsible for managing credit risk and implementing credit policy in the corporate segment. The subcommittee on retail lending is responsible for managing credit risk and implementing credit policy in the retail segment.
Effective management desk and minimization of risk is a top priority for Bank vozrozhdenie. Its risk management strategy focuses on achieving an optimal balance between profitability and the risk assumed. When developing its risk management system, the bank takes into account recommendations of the central Bank of Russia and the basel Committee on Banking Supervision. The banks risk management system takes account of risks both when making management decisions and during day-to-day banking activity. The system is designed to detect, identify and classify potential risks quickly, as well as analyze, measure and assess risk exposure and apply specific methods for managing banking risks. Procedures for assessing and managing risk are integrated into day-to-day business processes. Bank vozrozhdenies main risk management objectives are to mitigate the overall threats to its operations using the resources available, reduce the number of unforeseeable events/losses, evaluate the effectiveness of the business given the risks assumed, and streamline the risk management system.
Sponda receives half of its Russian rental revenue in us dollars and half in roubles. Most of the rents paid in roubles are tied to the us dollar or euro exchange rate. . The sarbanes exchange rate risk arising from the use of the rouble is reduced by the fact that a significant portion of the companys own expenses in Russia is also paid in roubles. Sponda hedges a six-month cash flow from Russia. The companys investments in Russia are mainly funded in euros from the parent company balance sheet. Special features of the russian property market and exchange rate fluctuations. Sponda is a local operator with offices in Moscow and. Networking and good relationships with the authorities are important for business operations. The companys strategy in Russia is to invest in high-quality properties in prime locations.
of their tenancy. The company has a diverse tenant base representing a wide variety of sectors. Availability of financing, sponda reorganises maturing loans in a timely manner. When the financial market is tightening up, the company refinances loans well before their maturity. Spondas next major refinancing needs will arise in 2014. At the end of 2012, Spondas available credit limit stood at eur 510 million. Interest rate risk, sponda reduces its interest rate risk through fixed-interest loans and interest rate derivatives.
Risks are hotel assessed in terms of their probability as well as their financial impact. Achieving financial targets is a sign that risk management has been successful. . Spondas key risks are classified as strategic risks, operational risks, damage and asset risks and financing risks. These risks are described in more detail in the section. Risks and risk management. Short-term risks related to Sponda's operations. Risk management actions, fall in economic occupancy rate, spondas property portfolio is mainly located in Helsinkis city centre and the ruoholahti district. The company spends approximately.5 per cent of the property portfolio value on modernisation investments each year.
Posti, annual, report 2015
In the past financial year, the wilo Group continued to strengthen the foundations for accelerated, profitable growth. Revenues increased substantially for the eighth year in succession. Consolidated net income also reached a new high in 2017. Major projects and measures for securing the future prospects of the wilo Group were initiated or continued. The wilo Group also made substantial investments in a modern, high-performance company infrastructure. Smart urban areas are one of the key growth segments for Wilo. These future markets will see the intelligent digital networking of urban infrastructures and various areas of life, thereby bundling all of the challenges for which Wilo can offer and develop smart, efficient solutions. Search from site, sponda manages the risks associated with its plan operations by identifying, measuring and preventing key uncertainties. The company employs effective risk management to protect its business operations and ensure that key objectives are achieved.