Response of VTB to the COVID-19 PANDEMIC Response of VTB to the COVID-19 PANDEMIC
The coronavirus pandemic has defined the trends of 2020. In unprecedently tight timeframe VTB managed to fully restructure the operations by shifting mainly towards the remote work format, without any detriment to technological plans of the Bank.
We did commendable work in fulfilling our role as one of the country’s systemically important banks and helped the clients combat the economic fallout from the pandemic.
Support of clients in Retail Business VTB was very attentive to customer support during the pandemic
In 2020, about 400 thousand VTB clients took advantage of repayment holidays of RUB 300 billion in loans.
Some 92% of the repayment holidays in numerical terms and 88% in monetary terms were implemented within the Bank’s own programmes.
Through VTB’s own programme, 340 thousand customers with a total loan portfolio of RUB 265 billion were able to defer payments.
Within the framework of both state- and Bank-run programmes, more than 34 thousand customers took advantage of repayment holidays on RUB 63 billion in loans.
In March 2020, VTB launched its own Bank Mortgage Holidays programme prior to the introduction of legislative changes on measures of financial support for the public.
Within the framework of both state- and Bank-run programmes, more than 324 thousand customers took advantage of repayment holidays on RUB 232 billion in loans.
In a very short time, the Bank launched its own programme of repayment holidays with an increased limit of up to RUB 2 million, in addition to the state programme under Federal Law No. 106-FZ dated 3 April 2020. A refinancing programme with deferred payments was also launched, allowing customers to skip up to first three payments when transferring loans to VTB (support for customers who were not granted repayment holidays by their own bank).
In 2020, VTB Bank issued more than 63 thousand loans in 2020 worth more than RUB 198 billion.
In April 2020 VTB began accepting applications and issuing mortgages as part of the State-Supported Mortgage 2020 mortgage subsidy programme, which enabled customers to take loans at a preferential rate for the purchase of new housing.
In 2020, more than 114 thousand customers were able to reduce their rates and their mortgage payments by RUB 255 billion.
The decrease in interest rates resulted in a high level of demand on the part of borrowers for refinancing programmes. In 2020, more than 114 thousand customers were able to reduce their rates and their mortgage payments by RUB 255 billion. The share of such transactions reached 27% in terms of sales, compared with 13% in 2019.
In 2020, more than 1.5 thousand loans were issued online worth RUB 7.5 billion.
In April 2020, the first completely remote mortgage transaction was carried out (jointly with PIK Group). The transaction was completed with an electronic digital signature; the client concluded the transaction online and signed the mortgage agreement without leaving their home.
In total, the Bank helped pay out RUB 13.6 billion.
From April to September 2020, the Bank, together with the Pension Fund of the Russian Federation, made additional payments to families with children (in the amount of RUB 5,000 and RUB 10,000) in accordance with the Decrees of the President of the Russian Federation No. 249 dated 7 April 2020 and No. 317 dated 11 May 2020.
In 2020, the Bank accepted more than 6 thousand applications on the disposal of family allowances; the total amount of funds received under these requests amounted to RUB 2.8 billion.
Beginning April 2020, citizens were able to apply to Bank divisions on matters related to the use of family allowances without having to visit the Pension Fund of the Russian Federation. The new technology greatly reduces the time needed to obtain a family allowance certificate (from 15 to 5 days) and the period during which the certificate can be used (from 30 to 10 days), starting from 15 April 2020.
Other support measures of Retail Business clients
For the period from 15 April until 30 September 2020 acquiring fees were set at 1% of the transaction amount for retail and online stores providing access to essential goods such as food, medicine, clothes and other items of daily use.
VTB promptly negotiated with all payment systems to reduce interbank commission for the said period, thus fulfilling the decision of the Bank of Russia. The reduction of fees led to a rapid growth of online purchases and facilitated the transition of the stores from offline to online format. Monthly average volume of online purchases, when compared to pre-pandemic levels, increased by 30% with consequential habituation of customer behaviour.
An agreement was reached with all payment systems to cancel the procedure for checking the validity of payment cards that expired in March–April 2020.
Such cards could be used as usual to pay for goods and services and to withdraw cash, which eliminated the need to visit an office or to have contact with a courier.
As per the decrees of the President of the Russian Federation on lockdowns, payments on loans during the period from 30 March through 5 May 2020 were debited according to the agreed repayment schedule; if a customer was unable to deposit funds through remote channels or working Bank offices, no fines or penalties accrued, and the Credit History Bureau was not informed about missed payments.
Support of clients in Medium and Small Business
During the pandemic, the Bank, together with the Russian Government and the relevant federal executive authorities, implemented a number of support measures for the clients of Medium and Small Business
Participation in support programmes for companies from the most affected industries
more than 21 thousand loan agreements were concluded from June 2020 to November 2020 for a total amount of more than RUB 79 billion
Preferential lending at 2% with debt relief subject to retaining 80% of their workforce as of 1 April 2021.
over 6 thousand loan agreements were concluded for a total amount of over RUB 25 billion
Providing preferential loans at 0% interest for urgent needs to support and retain employees (payment of wages and payroll charges).
A special section was created on the VTB website
https://vtb.ru/stayhome. The page contains answers to important questions, information about products and remote services, and attractive offers from partners.
In 2020, the Bank implemented a number of support measures for the clients of Medium and Small Business:
fees were set at 1% of the transaction amount for retail and online acquiring services for certain types of activities, the list of which was determined by the Bank of Russia (until 30 September 2020); preferential fees were set for servicing corporate cards during an extended card validity period (until 31 August 2020).
The entire line of packages for Medium and Small Business clients established comfortable fees for businesses. Upon activation of packages for payment and cash management services, corporate cards were issued free of charge, and the annual service fee for such cards was waived. Funds can be withdrawn from cards both at VTB ATMs and at ATMs of third-party banks around the clock. They can also be used to pay entertainment and hospitality expenses and to make cashless online purchases of goods and services from retail and service enterprises.
VTB Bank implemented its own programme to restructure existing loans with a provision for deferred payments for customers whose businesses had already suffered from the spread of COVID-19, as well as restructuring under Federal Law NO. 106-FZ dated 3 April 2020 and restructuring carried out in accordance with Government Resolution NO. 410 dated 14 May 2013.
WITHIN THE FRAMEWORK OF BOTH STATE- AND BANKRUN PROGRAMMES, VTB RESTRUCTURED AGREEMENTS IN THE AMOUNT OF RUB 277 BILLION
4,076 LOAN AGREEMENTS WERE RESTRUCTURED THROUGH THE BANK’S OWN PROGRAMMES IN THE AMOUNT OF RUB 210 BILLION
Support of clients in Сorporate-Investment Business
In 2020, the Bank, together with the Government of Russian Federation and specialising federal agencies implemented a number of support measures for the clients in Corporate-Investment Business
Lending to systemically important companies to replenish the circulating assets
21 loans were issued for a total of RUB 28.6 billion
Replenishment of the circulating assets in the amount of no more than RUB 3 billion for a period of up to 12 months. Maximum rate of 5% per annum
Participation in support programmes for companies from the most affected industries
36 credit agreements were concluded for a total of RUB 12.6 billion
Preferential lending at 2% with debt relief subject to retaining 80% of their workforce as of 1 April 2021
9 credit agreements were concluded for a total of RUB 6.5 billion
Preferential loans at 0% interest for urgent needs (wages and salaries and payroll charges)
By the beginning of the pandemic, the Bank has already adapted all internal client communication processes to remote format. This allowed to promptly, following client requests, restructure loans due to the pandemic. In total, RUB 1.3 trillion worth of loans were restructured for about 60 groups of companies – clients of
Corporate-Investment Business . Rapid digitalisation
35 thousand 35 remote workplaces were created as part of the transition to remote work, the throughput capacity of communication channels was increased tenfold.
90 % 90 % of the Bank’s staff was moved to remote work format in less than a month.
The Bank continued to implement all its technological development projects, without stopping investments related to improving reliability, developing its omnichannel approach and unifying the IT landscape.
IN 2020, WE WERE ABLE TO ACCOMPLISH A GREAT DEAL IN TERMS OF VTB’S DIGITALISATION AND ALSO ACHIEVE EXCELLENT BUSINESS RESULTS.