The strong devaluation of the Russian rouble has caused a shake-up within 2015's top 25 central and eastern European (CEE) banks ranking, which also includes central Asia. While the top three banks have not changed – Sberbank, VTB Bank and Gazprombank – the Tier 1 capital positions of these lenders has decreased significantly.
The exchange rate impact is evident when comparing the underlying rouble-to-US dollar exchange rates in 2015’s ranking with those of last year: $1 cost Rbs56.26 as of the end of 2014 (and therefore used for this year’s ranking), compared with the Rbs32.73 rate used in the 2014 ranking. This, on top of economic difficulties in Russia and the impact of Western sanctions, has caused Sberbank’s capital fall by nearly 35% to $35.7bn, VTB’s by 29% and Gazprombank’s by 36%.
Four exits from the region’s top 25 are from Russia, with last year’s 22nd through to 25th positions – Bank Uralsib, MDM Bank, Ak Bars Bank and Russian Standard Bank – all significantly reducing their capital bases.
Ukraine’s Ukreximbank, which last year ranked 12th in the regional ranking and 388th overall with $2.1bn of capital, also drops out of the top 25. It falls to 822nd in the global ranking, as its capital declined by nearly 70% to $654m. Other Ukrainian lenders, Privatbank and State Savings Bank of Ukraine, drop by four and six places in the regional ranking, respectively, following 44% and 47% contractions in capital.
PKO Bank Polski was one of the beneficiaries of Russia’s struggles, rising one place to fourth position regionally, despite slightly decreasing its capital base.
Kazakh Halyk Bank and Kazkommertsbank also move up the rankings, as two of only four lenders in the regional ranking to have increased their capital. This year’s numbers 21 to 25 are all new entries and have all upped their capital compared with the 2014 ranking. This movement brings three new countries into the regional ranking via the entrance of International Bank of Azerbaijan, Romania’s Banca Transilvania and Bank of Georgia.
Another Georgian lender, TBC Bank, enters the Top 1000 this year, after it went public on the London Stock Exchange in 2014. It is the second highest mover in the region, thanks to a 33% increase in capital to $519m, placing it 906th in the global ranking. The bank only marginally missed out entering the ranking last year, when it reported just $2m less capital than 2014’s 1000th placed Banque de Commerce et de Placements, which had $391m.
