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"The Far East is greatly assisted, but business needs to be more active"
Dmitry Sukhoverkhov on Sberbank's priorities in the developing east of the country
In April, 2017, the chairman of the Far Eastern Bank of Sberbank of Russia, was Dmitry Sukhoverkhov, who previously headed the Rostov branch of the bank. Almost six months after the appointment, Mr. Sukhoverkhov for the first time shares his vision of how to conduct banking business in the Far East. Whether the existing measures of state business support are sufficient and whether it makes sense to extend tax breaks to the entire macro region, what are the prospects for the development of high-tech industries and cooperation with China, why the share of cashless payments is growing, and it becomes easier to take a mortgage in an interview with EastRussia.
- You are in the region since the spring. What is your overall impression?
- First impressions: here people live energetic, purposeful, not indifferent to their business and environment. By the way, it reminds me of the south of Russia. In addition, the Far East - the territory in terms of development is still young, but also consisting of very different regions. What I see in the business environment has very good potential. The second feature of the Far East, which can not be overlooked, is a huge amount of local business. The European part of Russia is to a much greater extent covered by network companies: from hairdressing salons to foodstuffs chains. And this, I believe, one of the advantages of our economy is that there are many more subjects of economic activity in the Far East. More people who make decisions on the ground. This also has an impact on banking activities.
- This is a competitive plus of the macroregion. But how to use it in terms of capitalization?
- Any phenomenon has pros and cons. From the point of view of the plus, it is probably a great opportunity for the population to develop business. In terms of capital intensity, yes, networks have more opportunities. And the Far Eastern prices, it's not a secret, are significantly different from the prices in the European part of Russia - in many ways this is also the effect of the lack of networks. We are not ready to offer any recipes, but as a servicing bank we can precisely work with any categories: small business - to give conditions for development, financing, consulting, large network companies - to provide general management solutions.
- Since you already managed to communicate with business, in your opinion, companies in the Far East need to: get the infrastructure, what are the measures aimed at supporting the recent years, in particular, the territory of advanced development, or the possibility of preferential lending?
- You know, firstly, the regions of the Far East, and this is clearly seen, have more assistance from the state than any other region of Russia, if you subtract Sochi, maybe Moscow and St. Petersburg. This is a huge investment, and it is very noticeable when you move. In one Vladivostok, more bridges have been built recently, than across the river Don for a very long time. As for the forms of state support, I think this depends heavily on the project itself. There is no general recipe for everyone. For someone in the first place, of course, you need infrastructure, if it's production sites. And in terms of financing, very good instruments work only in the Far East - they are loans for investment projects of the "Far East Development and Baikal Region Development Fund" (FRDF) and the Sakhalin Oblast Development Corporation. With the FRDF, Sberbank also implements the "Affordable Credit for SMEs" program, which has no restrictions on industries, the minimum loan amount is commensurate with the needs of small businesses. Together with JSC "Corporation SME" - the program 6,5, in which the maximum limit on the rates is no more than 10,6% per annum, and the amount of financing - from 10 million rubles. For 2017 year, the Far East business under the program has been given more than 1,2 billion rubles.
- It's enough?
- So far, not all of these tools are fully applicable. But this, including, the task of Sberbank - to be a conduit for full-fledged work. At the same time, it is difficult to generalize the entire Far East: the subjects are very different among themselves. There are so many different territories, probably not in any federal district, except for ours. And you can not talk about any universal support tool. It seems to me that the task of the state here is to create a set of tools for the entrepreneur to choose: what use. But how to use them is a matter of dialogue between business and the state, and we are here ready to act as a consultant.
"Working with a bank is always a dialogue"
- What key consulting tools can you offer to the Far Eastern business?
- If we are talking about investment projects, Sberbank is undoubtedly one of the leaders in terms of investment lending: not so many financial institutions in the country have long resources, ready programs, and most importantly - experience in their implementation. We have already implemented enough projects in the Far East, but we have even more global plans. And working with Sberbank is not working with the window where you put the documents, and then you get the finished result. It's always a dialogue. We give a financial evaluation to the project, and we give the client an opportunity to assess the pros and cons to avoid bugs.
- And how to protect the project from instability in the economy help?
- In recent years, we have paid great attention to the issues of transactions in financial markets. We offer unique services: analysis of external economic trends, foreign trade commodity and currency exchanges, cross-currency exchange rates, structuring of derivatives transactions, development of financial engineering products. In the bank there is a division of global markets - a specialized structure that has the authority to enter into contracts on behalf of the client on commodity and currency exchanges, in particular, to MBE, and also has a deep expertise in this area. We offer tools for hedging the value of basic commodity assets: grain, oil, gas and oil products, metals, as well as the value of any currencies and interest rates. Letter of credit is becoming more widespread as a civilized and safe form of payment. We are developing partnership with Chinese banks, we have quite a lot of projects. Help is basically the basis of the approach of the Savings Bank. We do not sell any products - we try to satisfy the need. Our task is to identify the client's needs and to offer the best tools for this. The consultation begins already at this stage, since the number of products in banks is incalculable, and it is impossible for a client to know each of them.
- Without applying for a loan, too, can you learn something?
- I will say more: we are already actively learning entrepreneurs. Together with Google, Sberbank implements the business skills development program Business Class. The course includes eight online modules and four full-time master classes in Vladivostok and Khabarovsk. It consists of video lessons, test tasks, additional materials and webinars, and also involves mentoring and meetings with experienced experts. At the moment on the official website of the program - business-class.pro - more than 8 thousand people from various subjects of the Far Eastern Federal District have registered. The average age of participants who joined the project is 30 years. The sphere of business interests is very extensive: from retail sales to the sphere of public catering. In July, the first workshop for entrepreneurs was held. More than 300 businessmen from Khabarovsk and Vladivostok took part in it. He was led by the famous Moscow expert in the field of marketing and business modeling Konstantin Holstinin, he told the participants about the study of consumers and the application of design thinking to improve business models. Customer feedback was most positive.
"Innovation in the Far East needs to be supported"
- You mentioned cooperation with China. Recently, Sberbank decided to create with the Harbin Bank an investment fund MT2 $ 50 million, aimed at investing in start-ups. Somehow go farther and deeper into the Chinese market, attracting everyone with a low interest rate, are going to?
- With China, it is quite difficult to enter into any specific deals, although you want: its market is a blue ocean, it is unlimited, it is incomparable with the market of our Far East. But there are certain barriers to entry. On the foundation that you mentioned. Sberbank is actually one of the leaders in lending to start-ups, creating funds for investment, and here, by joining forces with Chinese partners, we will definitely be able to achieve synergy. However, while the bulk of our interaction with China is still settlement, conversion operations. We see that the Chinese partners are interested in expanding cooperation: despite the rather short period of my stay in the Far East, I have already visited China, including at a meeting of the Russian-Chinese financial council, and we signed a number of agreements there, outlined new ways development.
- While some high-tech products, stunning imagination, the macroregion can not boast, except in the defense industry. Fund support start-ups and high-tech projects will be what to support exactly in the Far East?
- I have a slightly different view of the situation. We at the Eastern Economic Forum will represent the president of Sberbank German Gref winners of international olympiads in robotics. These are residents of the Far East, who, living here, studying here, take prizes in olympiads. In general, in my understanding, the region's innovation is very weakly dependent on some territorial features. In the Far East, I see quite a strong support from private business. In particular, robotics is supported by DNS company - one of our partners. We are going to sign an agreement with the FEFU on the support of the Department of Computer Science to share experience and give students the opportunity to study at Sberbank. Perhaps, it is slightly better conditions in Moscow, in St. Petersburg, which collect the best minds. But we are closer to China, to Japan. So here I am probably more optimistic than you.
- What innovations will be presented at the Eastern Economic Forum?
- Sberbank always takes an active part in the WEF. We are planning to hold a number of multilateral meetings with the participation of foreign partners of the bank, governments of the constituent entities of the Russian Federation, and business of the region, which will result in signed cooperation agreements, including on the implementation of major investment projects. German Gref, President, Chairman of the Board of Sberbank, will moderate the session with representatives of the Far Eastern SMEs “Easy Start! Small business development. At this meeting, the discussion will focus on business development issues, including through new banking services. The session “Cybercrime is a key threat to the digital economy”, which will be conducted by Stanislav Kuznetsov, Deputy Chairman of the Board of Sberbank, will discuss how to ensure the safe integration of macro-region companies into the digital business ecosystem.
In addition, Sberbank organizes meetings of clients interested in exporting to China or importing products from China with their potential foreign partners from the Asia-Pacific region. At the moment, the Bank of Harbin is looking for Chinese counterparties for our clients, it is possible to sign four and bilateral agreements.
Also, in our office located on the FEFU campus, we will present new digital solutions for customers. Among them, the application "Sberbank investor" for the purchase and sale of shares and bonds on the stock exchange, 3D tour of real estate, a virtual game "Cybersecurity", an interactive business simulator.
"Revolutions are not needed - it is better to carefully improve the tools of support"
- Are credit resources for business generally becoming more accessible?
- In principle, the level of the interest rate, which is constantly decreasing, gives much more opportunities for business development and without the conditions of state support. Access to finance is improving. There is, rather, another problem - inadequate activity in terms of investment by entrepreneurs themselves. Such a wait-and-see attitude. And from my point of view, now is a good time to start new projects, especially as the country is increasingly focused on the domestic economy. Here, perhaps, we, the authorities, and the media need to work to highlight these opportunities, so that ultimately new ideas are generated or the existing industries are developed. For a long time I do not remember such rates and such accessibility of long money as now for all my more than 20-year experience in banking. And I see quite a limited number of new projects.
- Do you think that the business is cautious because it does not have information?
- Not all business has stopped. But there is so much information that it is very difficult to single out the one that will be useful for you. On any issue you can find diametrically opposed opinions, and here the matter is in trusting the source of information. We see our function in providing the business with the right information for decision-making.
- And, perhaps, the state policy in relation to the Far East needs to be corrected? For example, to make the macroregion a global zone free. To release the Far East from personal income tax, for example, were there such offers?
- You know, I have a more evolutionary approach to solving issues. I believe that an evolutionary approach and building a uniform activity gives a better result than some kind of revolution - either you guess, or you don’t guess. Cancel personal income tax? It sounds beautiful, but what will it lead to? What, people here will immediately rush to move en masse from central Russia?
- Give a mortgage for 0%, as it is done for residents of the Kuril Islands.
- The salary ratios in the Far East largely take this into account. And I do not think that such actions will lead to any kind of qualitative dramatic change. It seems to me that it is more appropriate here to build a long-term policy for support - what I see from the state - for the development of instruments, the careful introduction of new ones. This, from my point of view, is more correct.
- Can you name some branches of the economy of the Far East as drivers of development if you invest in them?
- The first is construction, the second is agriculture, and this is relevant for the Far East, because we now either import or import many types of food from other regions. The third is the transport infrastructure. And further, I can note the extraction of minerals and aquatic biological resources and tourism.
“We have a huge potential for the introduction of advanced products”
- What special products can Sberbank offer to the population of the Far East?
- Our vast distances, on the one hand, give rise to the problem of the availability of financial services. On the other hand, they provide great benefits from the use of modern products. Digitalization of the banking business is no longer the future, it is a reality. People realized that money can be transferred at the speed of SMS. And where there is cellular coverage, Sberbank provides opportunities for cashless payments. In general, I see a huge potential for reducing the share of cash payments, and more in the Far East than in any other region. The same local taxi drivers often say: "Don't look for a trifle, you can throw money over the phone." New financial services penetrate our daily life and become familiar. Also, the sale of goods and services via the Internet is already in demand in the region. Sberbank, in addition to the traditional payment on the website of the online store, gives partners the opportunity to send their customers a link to the payment page in a letter. You can use it to pay for the services of a partner who does not even have a business card website, but communicates with customers by e-mail. Or for stores that form their showcases on social networks, it is possible to receive payment for goods and services directly in the instagram application. It is enough to indicate an e-mail address in the comments under the product you like and a link to a web page for online settlements will be sent to it.
- How much is the share of those who prefer to make payments online?
- The audience of active users of the mobile application "Sberbank Online" exceeded the audience of online banking. In the Far East, for the first half of the year 2017 compared to the first half of the year 2016, the number of transactions in the application has increased to almost 16 million. For the web version, the growth was 2,5% - today it is 8 million transactions.
- To take a loan online, absolutely without a visit to the bank, is it already possible?
- Yes, you can get a consumer loan without visiting the office, submitting an application through Sberbank Online. In this case, the client receives money on a bank card or account. Through the service "DomKlik" any client can apply and get a decision on the application for a mortgage at any time and in any place. The client can visit the office directly for a loan. The application for iOS and Android allows you to track the stages of the transaction, exchange documents, simply photographing them on a smartphone, and communicate with your mortgage manager. Since the beginning of 2017, 8% of Far Eastern Sberbank customers have applied for a mortgage with the help of DomKlik, through which 4% of loans were issued. There, on the portal, you can ask a question about the mortgage and get advice in the 24 / 7 mode, as well as pick up real estate. Another breakthrough - in August last year, Sberbank and Rosreestr launched a joint service for the electronic registration of ownership of real estate. They have already benefited more than 50% of Sberbank's clients in the Far East, including those who purchased real estate without credit funds, or in another region of Russia. The service allows you to apply for registration of the transfer of ownership in electronic form, save on state duty, reduce interest on mortgages.