President of Russia Vladimir Putin: Mr Kostin, our construction complex and the entire building industry are shifting to a new system of work. Its operation and results will largely depend on the banking system’s reaction to these changes.
I know that your bank has also been using escrow accounts with your clients. How is this work going? Let’s begin with this.
President and Chairman of VTB Bank Management Board Andrei Kostin : It is true. As you have said, the work has just begun: the new law and the new rules came into effect on July 1. But for now we can see only positive results.
Speaking about escrow accounts, so far, about 1,500 accounts worth over six billion have been opened at our bank. We believe that 25,000 accounts will be opened by the end of the year.
We are actively working with builders using the project financing system. We have 1,800 builders’ accounts and 50 projects worth 220 billion rubles. We are also working on other projects worth 200 billion rubles. This is the money that will be allocated to build accommodation for those who will later open escrow accounts. So the work is in full swing, and I find it positive that this does not result in higher construction costs. This is why I think that we will accomplish this task. To tell the truth, I do not see any problems in this area.
Vladimir Putin: And what do you think about mortgages in general?
Andrei Kostin: Mortgages are doing well. We can see no “bubbles” there. As of today, the bank has a mortgage portfolio of 1.5 trillion rubles. In the first six months it saw an increase of 300 billion, or 120,000–130,000 new loans, or about a quarter increase on last year. Quite a quick growth. However, the demand remains stable. We can see that our clients are actively using it.
By the way, we are introducing new digital methods to simplify this work. Today people living in the Moscow Region can apply on the bank’s website and undergo the entire procedure online: they only need to come to the office once to apply for a loan. We plan to extend this service to other regions by the end of the year. In fact, we have the aim of creating a platform where clients can use digital means to choose, buy, sell, or repair residences, by the end of the year. Everything will be available online.
To be continued.