VTB expects Q1 profit to top 100 bln rubles, preparing to sell some blocked assets
MOSCOW. March 27 (Interfax) - VTB will earn an IFRS net profit of more than 100 billion rubles in the first quarter of 2024, the Russian state bank's first deputy CEO, Dmitry Pyanov told reporters.
The bank released its results for the first two months of the year on Wednesday, reporting a net profit of 61.3 billion rubles, a third less than a year earlier.
"With a net profit of 61.3 billion rubles, we believe we are guaranteed to exceed 100 billion rubles in net profit for the first quarter. Time will tell by how much we exceed," Pyanov said.
VTB plans to earn a net profit of 435 billion rubles in 2024, about 100 billion rubles of which could be generated by work with blocked assets. VTB had an estimated 900 billion rubles worth of such assets at the end of 2023.
The bank has worked out four strategies for working with blocked assets. The first is to transfer a portion of the blocked assets and liabilities of VTB and Otkritie Bank to the books of a specially created entity under law No. 292-FZ. The second is litigation against VTB subsidiaries in Europe and the UK over which it lost control in 2022, and the third is deals with other banks that, unlike VTB, have a large amount of blocked liabilities but insufficient blocked assets. The bank did not disclose the details of the fourth strategy.
Pyanov said the bank plans to sell a portion of its blocked assets to a third party in April as part of the implementation of the third strategy. The deal will include assets worth several tens of billions of rubles.
"Essentially, it is very likely that by the end of April we will complete and present to you the parameters of one of the strategies, which was called 'outside counterparty.' We are now finalizing this matter. Depending on when in April we conclude this, enter into a contract and settle up, it closure will either be in the second quarter, if it's in late April, or perhaps even the first quarter if it's early April," Pyanov said.
"This will determine by how much we then exceed the target of a 100 billion profit for the first quarter. It does not currently include this component. We will make 100 plus in any case, but the amount of profit will depend on when this deal is completed," Pyanov said.
He also said there might be similar deals with other counterparties in the course of the year.
"We're not ruling it out, which is why we will postpone the transfer of our assets [to the books of a separate company] until the end of 2024, so as to find some new counterparty if we can, since we have 900 billion [rubles] in blocked assets," Pyanov said.