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Presentation 2007

Presentation 2007. Contents. Company Profile _ 3 Shareholders Structure _ 4 Board of Directors _ 5 Management Structure _ 6 Executive Summary _ 7 Key Figures _ 8 Key Developments _ 9 Strategy__ 11 Competitive Advantages 12 Market Positioning ___________ 13

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Presentation 2007

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  1. Presentation 2007

  2. Contents Company Profile _3 Shareholders Structure _4 Board of Directors _5 Management Structure _6 Executive Summary _7 Key Figures _8 Key Developments _9 Strategy__11 Competitive Advantages12 Market Positioning ___________ 13 Clientele Base 14 SME Lending16 International Activity18 Assets Quality19 Loan Portfolio20 Customer Accounts21 Bank’s Share in Tatarstan Banking Market22 Branch Net23 Contact List24

  3. Company Profile In 2007, European Bank for Reconstruction and Development became a largest single shareholder of Spurt Bank

  4. Shareholders Structure • EBRD 28.2% • OOO Gaz-Market 19.8% • OAO Nizhnekamskneftekhim 14.1% • OOO Bistel 10.0% • OOO Technoservise-M 7.4% • OOO Airus 7.4% • Evgenia Dautova 5.8% • ZAO Gazprombank 3.0% • Others 4.3% The bank’s Shareholders are the largest enterprises and companies of financial, refinery and gas sector The main goal of the Bank's activity is: To increase the value of shareholders' investments

  5. Board of Directors

  6. Management Structure Management Structure is divided to Sales, Management and Support Units

  7. Executive Summary • Spurt Bank doubled its financial results in 2004 and maintained stable activities in 2005 and 2006 • European Bank for Reconstruction and Development acquired a 28.25 percent stakein the capital of Spurt Bank • Formulated and adopted long term development strategy and financial goals in the partnership with EBRD • Improved Bank's structure on the basis of international consultancy recommendations to support business growth • International audit of financial accounting since 2003 • 25 April 2007 Fitch Ratings has assigned Spurt Bank ratings at Issuer Default 'B-', Short-term 'B', Individual 'D/E', Support '5'. The Outlook for the Issuer Default rating is Stable. Adopted development strategy and reengineered structure aimed to support business growth and to enhance the competitiveness of the Bank

  8. Key Figures Financial results are calculated according to IAS at the exchange rate of the Central Bank of Russian Federation on the dates indicated Total Assets in 2006 increased by 33% to RUR 7.2bn. (USD 271.9 mio) – RUR 5.4bn. (USD 191.0 mio) for 2005 • In 2006 net loans increased by 51% to RUR 5.1bn. (USD 194.0 mio) – RUR 3.4bn. (USD 120.6 mio) for 2005 • Successful launch of the first bond issue in the amount of RUR 500 million, EBRD, KfW and RosBR credit lines for total amount RUR 540 million enabled the bank to increase it’s loan portfolio for corporate customers and SME sector. • Despite increase of provisions for the grown loan portfolio Net Profit of 2006 amounted to RUR 128.6 mio (USD 4.8mio) - RUR 126.5 mio (USD 4.5mio) for 2005 • Capital for the end of 2006 reached RUR 1,093 mio (USD41.5 mio) - dividends paid for 2005 amounted to RUR 80 mio • Country ratings of 2006 168 per net assets (“RBC - rating”) 148 per capital 136 per balance profit • Local ratings among Tatarstan banks 5 per total assets (“National Bankof RT of Central Bank of Russia”) 5 per capital 4 per balance profit Bank essentially increased its profit and assets in 2004 Both in 2004 and 2005 the return on equity and assets of the Bank was higher than the Russian banks' average

  9. Key Developments Financial results are calculated according to IAS at the exchange rate of the Central Bank of Russian Federation on the dates indicated

  10. Key Developments Financial results are calculated according to IAS at the exchange rate of the Central Bank of Russian Federation on the dates indicated

  11. Strategy • Principal activity Universal Bank, Independent from any Banking or Industry Groups • Key financial figures Capital / Assets ratio - not less 12%, not more 15% Operation expenses / Operation Income ratio – not more 45% ROE – not less 12% • Main principle of business Working with target client groups - Selling fixed range of profitable products • Leading criteria for client selection customer’s ability to utilize wide range of bank products • Regional policy Expansion of Branch net mainly as selling outlets for retail banking with the form of credit-deposit office. Serving of corporate sector through Head Office, except for particular customers served in specialized branches. • Relations with shareholders Main aim - transformation of bank shares into marketable assets High development potential, sustained by strong capitalization with capability of its growing The principles of transparency and legitimacy form the basis of interrelations between the Bank and its partners, regulatory bodies and the society

  12. Competitive Advantages Strong shareholder’s support in business and clientele base growth Low level of overhead charges, moderate personnel quantity Small dependence from volatile interbank market Marketing: • Deliberate concentration of main operations volume on relatively tight territorial and industrial segment of the market • High efficiency in response on customer’s queries due to the quick decision making • High corporate and professional culture with clear employee incentives Cost control • Individual responsibility for current expenses as a result of adopted budgetary policy Risk Management • Personal and managerial independence in risk management. Evaluation of risks before and during transactions • High processibility of risk management leads to service efficiency • Building of risk management, finance and business-planning systems in accordance with regulating requirements of international finance institutions (New Basel) Transparency • Preparing interim and annual IAS financials audited by well-known international audit company for increasing transparency and international relations development. Regular accountancy and distribution of dividends for shareholders, high quality of corporate management

  13. Market Positioning • SME Lending • Potential source of income growth supported by international and Russian funding • Product of demand throughout the branch net • Instrument for diversifying the assets structure Investment Banking funding for investments projects from capital markets and fixed income sales instruments Spurt Bank aims to be one of the leading independent corporate banks in Volga Region The Bank's business relies exclusively on commercial approaches • Retail Banking • Private banking for Top management of corporate customers • Salaries and credit banking card programs for corporate clients employees • Wide range of services for mass customer • ---------------------------------- • Instrument • for diversifying • of funding base • Corporate Banking • Basic product • Competitive pricing • Wide range of loans and overdrafts • Leasing and factoring • Trade and project finance • ------------------------------------- • Main source of income • Broadening of clientele base owing to business partners of corporate customers • Additional funding of active operations • Cross-selling of products • Financial Markets • Asset management • mainly for Insurance companies and • Pension funds • Fixed income trading • Equity brokerage • FX and Money Market • ------------------------------------- • Managing liquidity and market risks of the Bank • Funding instrument for bank operations • High potential in increasing of fee and commission income

  14. Clientele Base Tatarstan - one of the most economically developed Republics of the Russian Federation. Main wealth - crude oil. Leading industries: oil-production, chemical and petrochemical sectors, aircraft construction, shipbuilding, production of cars and trucks, mechanical engineering. At present one of the main sector of clients is fuel-energy complex, oil refinery and chemical industries. Diversifying it’s business Spurt bank actively develops the relationship with construction, aviation, light and food industries, trade and finance companies, small and medium enterprises. Main Bank's counterparties: enterprises of gas, petrochemical and chemical industries, mechanical engineering, construction, large trading companies, transportation companies and enterprises of light and food industries Gas and Energy Industry: Tatgazinvest, Tattransgaz, Liquefied Gas, KazEnergo Refinery and Chemicals production: Nizhnekamskneftekhim, Kazanorgsintez, Kazan Synthetic Rubber Plant Construction IndustryKazdorstroy, Koulon-stroy, Fon, Altair, IKhK Tatgazinvest Machinery constructionKAMAZ, Kazan Helicopters, Kazan Aircraft Production Association, Santekhpribor TransportTatflot Shipping Company, Kazan Aviation Enterprise “Tatarstan” Airlines InsuranceRosgosstrakh Tatarstan, Industrial Insurance Company, Sogas Insurance Company Light and Food IndustryTatarstan Sete (milk producing association), Safian Trade Industry Tatnefteproduct Holding Company, Smile (original distributor of Proctor & Gamble), Volga Natur Produkt, TD Orgsintez, Tatmetall, DOMO Finance Companies Regional Fuel & Energy Company

  15. Clientele Base Corporate partners of the Bank included in the list of 100 largest Russian companies :

  16. SME Lending • In June 2004 the Russian Development Bank owned by Russian Fund for Federal Property opened a credit line to Spurt Bank to the amount of RUR 57mio (US$2 mio equivalent). The funds received by the Bank under this credit line were used to provide credits to small and medium enterprises in the Republic of Tatarstan under a specialised programme by the Ministry of Finance of the Russian Federation for support of small and medium business. The total volume of disbursed funds under this program exceeded RUR 200mio. • On September 30, 2005 Spurt Bank, first from the Tatarstan banks, signed a Loan agreement with the European Bank for Reconstruction and Development for receiving a four-year senior loan of RUR 280 million (equivalent of USD 10 million) for on-lending to SMEs operating in the Republic of Tatarstan. For the first time in Russia the loan was granted in Rubles. The transition impact potential of this project arises mainly from its support of a transformation of a regional bank operating in the Republic of Tatarstan into a bank operating according to best practice standards of corporate governance and business conduct. The project aimed to support the bank’s diversification strategy and promote competition within the local banking market • In October 2005 Spurt Bank concluded an agreement with EBRD to implement the Energy Efficiency Projects Financing module in the framework of the SME Credit Line of European Bank for Reconstruction and Development. This new initiative of EBRD in Russia includes a free Energy Audit service and is aimed to help Russian companies to decrease the energy costs and protect the environment. • On September 12, 2006 Spurt Bank signed a Loan agreement with KfW Bank, Germany on the seven-year loan of USD 8 million for on-lending to local SMEs. The last tranche was disbursed in April 2007. European Bank for Reconstruction and Development and KfW Bank are the partners of Spurt Bank in the programs of SME Lending

  17. SME Lending • As of 18.04.2007 the SME Loan portfolio amounted to 775 mio. Rubles (12% from the Total Loan Portfolio - 6 411 mio. Rubles). 26% of the SME loans were disbursed using the EBRD technology. At present the monthly average increase of the SME loan portfolio is more than 50 mio. Rubles and the amount of SME loan portfolio at the end of the 2007 is planned to be more than 1 bln. Rubles. • Beginning from May 2006 a specialized business department aimed to work with SMEs was established in Spurt Bank. It includes the SME Division in the HO and six regional departments in the branch net (Kazan, Naberezhnye Chelny, Nizhnekamsk, Volzhsk). The number of such departments up to the end of 2007 planned to be increased up to 10. • Partners of the Bank in SME lending: - EBRD - USD 10mio loan - KfW - USD 8mio loan - Russian Bank for Development - 200 mio. Rubles - State Investment –Venture Fund of the Republic of Tatarstan Татарстан (Bank is approved in three joint programs of SME support).

  18. International Activity Main Correspondents: Commerzbank AG , Frankfurt Ost-West Handelsbank AG, Frankfurt Bank Austria Creditanstalt, Vienna • Strategy Broadening of customer base and service range by development of trade financing • Obtained medium and long term credit facilities on ECA covered base • 1.2 mio USD Loan from World Business Capital under ExIm bank’s policy • 3mio Euros approval of buyer’s credit facility from HERMES • Trade facilities received from international and Russian banks • 4 mio USD Trade Facilitation Program for 1 ½ years of EBRD • 1 mio USD trade credit line from VTB Bank Deutschland for 1 year • 1 mio USD trade credit line from Gasprombank for ½ year • Long-term loans received from international banks USD 10mio loan from EBRD for SME financing for 4 years USD 8mio loan from KfW for SME financing for 7 years • State approvals State Customs Committee included “Spurt” Bank to the register of banks, whose guarantees are accepted by customs bodies of the Russian Federation with increased total limit of 5 mio Euros Servicing contracts of well known Tatarstan exporters constitutes the main part of international operations

  19. Assets Quality Financial results are calculated according to IAS at the exchange rate of the Central Bank of Russian Federation on the dates indicated SPURT Bankaims to maintain the ratio of Liquid Assets to Total Assets of not less than 20%percent andratio of Liquid Assets to deposits maturing up to one month of not less than 100%percent

  20. Loan Portfolio Maturity Breakdown 2003 – 2004 Financial results are calculated according to IAS at the exchange rate of the Central Bank of Russian Federation on the dates indicated

  21. Analysis of Customer Accounts by Industry Financial results are calculated according to IAS at the exchange rate of the Central Bank of Russian Federation on the dates indicated Deposit structure became more diversified, retail deposits share increased significantly to 39% of total deposits, concentration grade on single clients went down

  22. Bank’s Share in the Tatarstan Banking Market • Tatarstan Republic • has the 5th place • for total number of banks among Russian regions • As of 01.01.06 • in Tatarstan: • 27 banks • 106 bank’s branches, including • 48 branches of banks, registered outside the republic • (41 from them - of Sberbank)

  23. Branch Net Branches and outlets of Spurt bank as of 15.04.2007 Head office – 2, Spartakovskaya Str. Zhilstroykredit Branch – 67А Vosstaniya Str. Finansovy outlet – 4 Butlerov Str. Azinsky outlet – 3А Zakiyev Str. Vakhitovsky outlet – 59  Karl Marx Str. Sovetsky outlet – 23 Sybirsky trakt Str. Nizhnekamsky Branch – 53 Prospekt Khimikov Str. Nizhnekamsky outlet – А-12 Manufacturing zone of JSC Nizhnekamskneftekhim Chelninsky outlet – 14 Academika RubanenkoStr. Mendeleyevsky outlet – 9 Octyabrskaya Str. Volzhsky Branch – 2 Transportnaya Str KAZAN City: Nizhnekamsk City: Naberezhnye Chelny City: Mendeleyevsk City: Volzhsk City (Mary Ell Republik):

  24. Contact List Our Web Site: www.spurtbank.ru

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