Sberbank - Annual Report 2010 - 10 Loans and Advances to Customers

Home Financial Report Financial Statements Notes 10 Loans and Advances to Customers

# 10 Loans and Advances to Customers

The tables below show credit quality of the Group's loan portfolio by loan classes as at 31 December 2010 and 31 December 2009.For the purposes of these consolidated financial statements a loan is considered past due when the borrower fails to make any payment due under the loan agreement at the reporting date. In this case the aggregate amount of all amounts due from borrower under the respective loan agreement including accrued interest and commissions is recognised as past due.

#### 31 December 2010:

In millions of Russian Roubles | Not past due loans | Past due loans | Total
--- | --- | --- | ---
Commercial loans to legal entities | 2,519,062 | 189,630 | 2,708,692
Specialised loans to legal entities | 1,900,813 | 262,673 | 2,163,486
Consumer and other loans to individuals | 598,304 | 37,385 | 635,689
Mortgage loans to individuals | 572,339 | 31,439 | 603,778
Car loans to individuals | 76,792 | 3,473 | 80,265
Total loans and advances to customers before provision for loan impairment | 5,667,310 | 524,600 | 6,191,910
Less: Provision for loan impairment | (276,906) | (425,617) | (702,523)
Total loans and advances to customers net of provision for loan impairment | 5,390,404 | 98,983 | 5,489,387

#### 31 December 2009:

In millions of Russian Roubles | Not past due loans | Past due loans | Total
--- | --- | --- | ---
Commercial loans to legal entities | 2,025,522 | 180,800 | 2,206,322
Specialised loans to legal entities | 1,760,286 | 299,698 | 2,059,984
Consumer and other loans to individuals | 526,373 | 37,991 | 564,364
Mortgage loans to individuals | 482,445 | 30,342 | 512,787
Car loans to individuals | 96,649 | 3,739 | 100,388
Total loans and advances to customers before provision for loan impairment | 4,891,275 | 552,570 | 5,443,845
Less: Provision for loan impairment | (190,956) | (388,858) | (579,814)
Total loans and advances to customers net of provision for loan impairment | 4,700,319 | 163,712 | 4,864,031

Commercial lending to legal entities comprises corporate loans, loans to individual entrepreneurs, federal bodies and municipal authorities of the Russian Federation. Loans are granted for current needs (working capital financing, acquisition of movable and immovable property, portfolio investments, expansion and consolidation of business, etc.). Majority of commercial loans are provided for periods up to 5 years depending on the borrowers' risk assessment. Commercial lending also includes overdraft lending and lending for export-import transactions. The repayment source is cash flow from current production and financial activities of the borrower.

Specialised lending to legal entities includes investment and construction project financing and also developers' financing. As a rule, loan terms are linked to payback periods of investment and construction projects, contract execution periods and exceed the terms of commercial loans to legal entities. The principal and interest may be repaid from cash flows generated by the investment project at the stage of its commercial operation.

Consumer and other individual loans comprise loans to individuals other than housing acquisition, construction and repair of real estate as well as car loans. These loans include loans for current needs and overdrafts.

Mortgage loans to individuals include loans for acquisition, construction and reconstruction of real estate. These loans are mostly long-term and are collateralized by real estate.

Car loans to individuals include loans for purchasing a car or other vehicle. Car loans are provided for periods of up to 5 years.

The table below shows the analysis of loans and provisions for loan impairment as at 31 December 2010:

In millions of Russian Roubles | Gross loans | Provision for impairment | Net loans | Provision for impairment to gross loans
--- | --- | --- | --- | ---
Commercial loans to legal entities |  |  |  |
Collectively assessed |  |  |  |
Not past due | 2,457,676 | (106,849) | 2,350,827 | 4.3%
Loans up to 30 days overdue | 6,895 | (2,234) | 4,661 | 32.4%
Loans 31 to 60 days overdue | 4,480 | (2,261) | 2,219 | 50.5%
Loans 61 to 90 days overdue | 7,058 | (4,552) | 2,506 | 64.5%
Loans 91 to 180 days overdue | 10,398 | (6,910) | 3,488 | 66.5%
Loans over 180 days overdue | 124,081 | (117,807) | 6,274 | 94.9%
Total collectively assessed loans | 2,610,588 | (240,613) | 2,369,975 | 9.2%
Individually impaired |  |  |  |
Not past due | 61,386 | (39,929) | 21,457 | 65.0%
Loans up to 30 days overdue | 1,616 | (1,378) | 238 | 85.3%
Loans 31 to 60 days overdue | - | - | - | -
Loans 61 to 90 days overdue | 3,896 | (2,688) | 1,208 | 69.0%
Loans 91 to 180 days overdue | 2,861 | (2,423) | 438 | 84.7%
Loans over 180 days overdue | 28,345 | (25,898) | 2,447 | 91.4%
Total individually impaired loans | 98,104 | (72,316) | 25,788 | 73.7%
Total commercial loans to legal entities | 2,708,692 | (312,929) | 2,395,763 | 11.6%
Specialised loans to legal entities |  |  |  |
Collectively assessed |  |  |  |
Not past due | 1,835,754 | (77,060) | 1,758,694 | 4.2%
Loans up to 30 days overdue | 16,715 | (3,805) | 12,910 | 22.8%
Loans 31 to 60 days overdue | 2,043 | (897) | 1,146 | 43.9%
Loans 61 to 90 days overdue | 5,827 | (3,330) | 2,497 | 57.1%
Loans 91 to 180 days overdue | 3,927 | (2,867) | 1,060 | 73.0%
Loans over 180 days overdue | 63,018 | (57,148) | 5,870 | 90.7%
Total collectively assessed loans | 1,927,284 | (145,107) | 1,782,177 | 7.5%
Individually impaired |  |  |  |
Not past due | 65,059 | (36,916) | 28,143 | 56.7%
Loans up to 30 days overdue | 5,086 | (5,072) | 14 | 99.7%
Loans 31 to 60 days overdue | 208 | (200) | 8 | 96.2%
Loans 61 to 90 days overdue | 689 | (689) | - | 100.0%
Loans 91 to 180 days overdue | 1,575 | (1,453) | 122 | 92.3%
Loans over 180 days overdue | 163,585 | (131,345) | 32,240 | 80.3%
Total individually impaired loans | 236,202 | (175,675) | 60,527 | 74.4%
Total specialised loans to legal entities | 2,163,486 | (320,782) | 1,842,704 | 14.8%
Total loans to legal entities | 4,872,178 | (633,711) | 4,238,467 | 13.0%
Consumer and other loans to individuals |  |  |  |
Collectively assessed |  |  |  |
Not past due | 598,304 | (9,776) | 588,528 | 1.6%
Loans up to 30 days overdue | 6,521 | (159) | 6,362 | 2.4%
Loans 31 to 60 days overdue | 2,014 | (141) | 1,873 | 7.0%
Loans 61 to 90 days overdue | 1,324 | (170) | 1,154 | 12.8%
Loans 91 to 180 days overdue | 2,177 | (490) | 1,687 | 22.5%
Loans over 180 days overdue | 25,349 | (25,349) | - | 100.0%
Total consumer and other loans to individuals | 635,689 | (36,085) | 599,604 | 5.7%
Mortgage loans to individuals |  |  |  |
Collectively assessed |  |  |  |
Not past due | 572,339 | (5,139) | 567,200 | 0.9%
Loans up to 30 days overdue | 3,979 | (242) | 3,737 | 6.1%
Loans 31 to 60 days overdue | 1,669 | (236) | 1,433 | 14.1%
Loans 61 to 90 days overdue | 1,206 | (246) | 960 | 20.4%
Loans 91 to 180 days overdue | 2,060 | (891) | 1,169 | 43.3%
Loans over 180 days overdue | 22,525 | (22,525) | - | 100.0%
Total mortgage loans to individuals | 603,778 | (29,279) | 574,499 | 4.8%
Car loans to individuals |  |  |  |
Collectively assessed |  |  |  |
Not past due | 76,792 | (1,237) | 75,555 | 1.6%
Loans up to 30 days overdue | 682 | (20) | 662 | 2.9%
Loans 31 to 60 days overdue | 248 | (17) | 231 | 6.9%
Loans 61 to 90 days overdue | 152 | (18) | 134 | 11.8%
Loans 91 to 180 days overdue | 300 | (65) | 235 | 21.7%
Loans over 180 days overdue | 2,091 | (2,091) | - | 100.0%
Total car loans to individuals | 80,265 | (3,448) | 76,817 | 4.3%
Total loans to individuals | 1,319,732 | (68,812) | 1,250,920 | 5.2%
Total loans and advances to customers as at 31 December 2010 | 6,191,910 | (702,523) | 5,489,387 | 11.3%

The table below shows the analysis of loans and provisions for loan impairment as at 31 December 2009:

In millions of Russian Roubles | Gross loans | Provision for impairment | Net loans | Provision for impairment to gross loans
--- | --- | --- | --- | ---
Commercial loans to legal entities |  |  |  |
Collectively assessed |  |  |  |
Not past due | 1,968,452 | (68,724) | 1,899,728 | 3.5%
Loans up to 30 days overdue | 13,910 | (4,863) | 9,047 | 35.0%
Loans 31 to 60 days overdue | 7,159 | (3,472) | 3,687 | 48.5%
Loans 61 to 90 days overdue | 7,597 | (3,897) | 3,700 | 51.3%
Loans 91 to 180 days overdue | 20,011 | (12,757) | 7,254 | 63.7%
Loans over 180 days overdue | 95,717 | (69,741) | 25,976 | 72.9%
Total collectively assessed loans | 2,112,846 | (163,454) | 1,949,392 | 7.7%
Individually impaired |  |  |  |
Not past due | 57,070 | (27,562) | 29,508 | 48.3%
Loans up to 30 days overdue | 47 | - | 47 | 0.0%
Loans 31 to 60 days overdue | 425 | (344) | 81 | 80.9%
Loans 61 to 90 days overdue | 1,684 | (1,676) | 8 | 99.5%
Loans 91 to 180 days overdue | 8,291 | (5,166) | 3,125 | 62.3%
Loans over 180 days overdue | 25,959 | (23,286) | 2,673 | 89.7%
Total individually impaired loans | 93,476 | (58,034) | 35,442 | 62.1%
Total commercial loans to legal entities | 2,206,322 | (221,488) | 1,984,834 | 10.0%
Specialised loans to legal entities |  |  |  |
Collectively assessed |  |  |  |
Not past due | 1,731,758 | (67,328) | 1,664,430 | 3.9%
Loans up to 30 days overdue | 16,027 | (4,395) | 11,632 | 27.4%
Loans 31 to 60 days overdue | 16,021 | (4,395) | 11,626 | 27.4%
Loans 61 to 90 days overdue | 8,133 | (4,500) | 3,633 | 55.3%
Loans 91 to 180 days overdue | 6,569 | (3,481) | 3,088 | 53.0%
Loans over 180 days overdue | 65,381 | (47,809) | 17,572 | 73.1%
Total collectively assessed loans | 1,843,889 | (131,908) | 1,711,981 | 7.2%
Individually impaired |  |  |  |
Not past due | 28,528 | (12,356) | 16,172 | 43.3%
Loans up to 30 days overdue | 2,052 | (1,138) | 914 | 55.5%
Loans 31 to 60 days overdue | 218 | (133) | 85 | 61.0%
Loans 61 to 90 days overdue | 2,638 | (2,464) | 174 | 93.4%
Loans 91 to 180 days overdue | 22,691 | (10,960) | 11,731 | 48.3%
Loans over 180 days overdue | 159,968 | (128,100) | 31,868 | 80.1%
Total individually impaired loans | 216,095 | (155,151) | 60,944 | 71.8%
Total specialised loans to legal entities | 2,059,984 | (287,059) | 1,772,925 | 13.9%
Total loans to legal entities | 4,266,306 | (508,547) | 3,757,759 | 11.9%
Consumer and other loans to individuals |  |  |  |
Collectively assessed |  |  |  |
Not past due | 526,373 | (8,926) | 517,447 | 1.7%
Loans up to 30 days overdue | 4,761 | (488) | 4,273 | 10.2%
Loans 31 to 60 days overdue | 2,339 | (476) | 1,863 | 20.4%
Loans 61 to 90 days overdue | 1,506 | (446) | 1,060 | 29.6%
Loans 91 to 180 days overdue | 2,923 | (1,440) | 1,483 | 49.3%
Loans over 180 days overdue | 26,462 | (26,462) | - | 100.0%
Total consumer and other loans to individuals | 564,364 | (38,238) | 526,126 | 6.8%
Mortgage loans to individuals |  |  |  |
Collectively assessed |  |  |  |
Not past due | 482,445 | (4,418) | 478,027 | 0.9%
Loans up to 30 days overdue | 4,014 | (725) | 3,289 | 18.1%
Loans 31 to 60 days overdue | 2,373 | (803) | 1,570 | 33.8%
Loans 61 to 90 days overdue | 1,574 | (776) | 798 | 49.3%
Loans 91 to 180 days overdue | 2,866 | (2,538) | 328 | 88.6%
Loans over 180 days overdue | 19,515 | (19,515) | - | 100.0%
Total mortgage loans to individuals | 512,787 | (28,775) | 484,012 | 5.6%
Car loans to individuals |  |  |  |
Collectively assessed |  |  |  |
Not past due | 96,649 | (1,642) | 95,007 | 1.7%
Loans up to 30 days overdue | 718 | (120) | 598 | 16.7%
Loans 31 to 60 days overdue | 397 | (120) | 277 | 30.2%
Loans 61 to 90 days overdue | 245 | (108) | 137 | 44.1%
Loans 91 to 180 days overdue | 436 | (321) | 115 | 73.6%
Loans over 180 days overdue | 1,943 | (1,943) | - | 100.0%
Total car loans to individuals | 100,388 | (4,254) | 96,134 | 4.2%
Total loans to individuals | 1,177,539 | (71,267) | 1,106,272 | 6.1%
Total loans and advances to customers as at 31 December 2009 | 5,443,845 | (579,814) | 4,864,031 | 10.7%

The table below shows the credit quality analysis of the Group’s not past due collectively assessed loans before provision for loan impairment as at 31 December 2010:

In millions of Russian Roubles | 1 group | 2 group | 3 group | Total
--- | --- | --- | --- | ---
Commercial loans to legal entities | 161,500 | 1,273,414 | 1,022,762 | 2,457,676
Specialised loans to legal entities | 80,026 | 793,995 | 961,733 | 1,835,754
Consumer and other loans to individuals | 5,685 | 590,441 | 2,178 | 598,304
Mortgage loans to individuals | 7,214 | 563,935 | 1,190 | 572,339
Car loans to individuals | 425 | 76,258 | 109 | 76,792
Total | 254,850 | 3,298,043 | 1,987,972 | 5,540,865

The table below shows the credit quality analysis of the Group’s not past due collectively assessed loans before provision for loan impairment as at 31 December 2009:

In millions of Russian Roubles | 1 group | 2 group | 3 group | Total
--- | --- | --- | --- | ---
Commercial loans to legal entities | 143,091 | 998,354 | 827,007 | 1,968,452
Specialised loans to legal entities | 55,924 | 784,784 | 891,050 | 1,731,758
Consumer and other loans to individuals | 4,932 | 518,955 | 2,486 | 526,373
Mortgage loans to individuals | 3,079 | 476,395 | 2,971 | 482,445
Car loans to individuals | - | 96,596 | 53 | 96,649
Total | 207,026 | 2,875,084 | 1,723,567 | 4,805,677

For the purpose of these consolidated financial statements, all not past due collectively assessed loans to legal entities are classified in three quality groups presented in the tables above with group 1 loans being of the highest quality. The 1-st group includes borrowers with sound level of liquidity and profitability as well as high capital adequacy ratio. The probability of breach of loan agreement terms is assessed as low. The 2-nd group includes borrowers with average level of liquidity and profitability as well as average capital adequacy ratio. The probability of breach of loan agreement terms is assessed as moderate. The 3-rd group includes borrowers with satisfactory level of liquidity and profitability as well as moderate capital adequacy ratio. The probability of breach of loan agreement terms is assessed as above moderate.

For the purpose of these consolidated financial statements, all not past due loans to individuals are combined into three groups presented in the tables above. The 1-st group of these loans to individuals is represented by loans with good debt servicing and excellent financial position of a borrower. The 2-nd group is represented by loans with good/average debt servicing and excellent/moderate financial position of a borrower. The 3-rd group is represented by loans with average debt servicing and moderate financial position of a borrower.

As defined by the Group for the purposes of internal credit risk assessment, loans fall into the "non-performing" category when a principal and/or interest payment becomes more than 90 days overdue.

As at 31 December 2010 the outstanding non-performing loans were as follows:

In millions of Russian Roubles | Gross loans | Provision for impairment | Net loans | Provision for impairment to gross loans
--- | --- | --- | --- | ---
Commercial loans to legal entities | 165,685 | (153,038) | 12,647 | 92.4%
Specialised loans to legal entities | 232,105 | (192,813) | 39,292 | 83.1%
Consumer and other loans to individuals | 27,526 | (25,839) | 1,687 | 93.9%
Mortgage loans to individuals | 24,585 | (23,416) | 1,169 | 95.2%
Car loans to individuals | 2,391 | (2,156) | 235 | 90.2%
Total non-performing loans and advances to customers as at 31 December 2010 | 452,292 | (397,262) | 55,030 | 87.8%

As at 31 December 2009 the outstanding non-performing loans were as follows:

In millions of Russian Roubles | Gross loans | Provision for impairment | Net loans | Provision for impairment to gross loans
--- | --- | --- | --- | ---
Commercial loans to legal entities | 149,978 | (110,950) | 39,028 | 74.0%
Specialised loans to legal entities | 254,609 | (190,350) | 64,259 | 74.8%
Consumer and other loans to individuals | 29,385 | (27,902) | 1,483 | 95.0%
Mortgage loans to individuals | 22,381 | (22,053) | 328 | 98.5%
Car loans to individuals | 2,379 | (2,264) | 115 | 95.2%
Total non-performing loans and advances to customers as at 31 December 2009 | 458,732 | (353,519) | 105,213 | 77.1%

Renegotiated loans. Information on loans which terms have been renegotiated, as at 31 December 2010 and 31 December 2009 is presented in the table below. It shows the carrying amount for renegotiated loans by class.

enlarge

In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Consumer and other loans to individuals | Mortgage loans to individuals | Car loans to individuals | Total
--- | --- | --- | --- | --- | --- | ---
31 December 2010: |  |  |  |  |  |
Not past due collectively assessed loans | 402,606 | 171,884 | 6,824 | 1,958 | 38 | 583,310
Other renegotiated loans | 96,571 | 54,160 | 3,299 | 10,197 | 184 | 164,411
Total renegotiated loans before provision for loan impairment | 499,177 | 226,044 | 10,123 | 12,155 | 222 | 747,721
31 December 2009: |  |  |  |  |  |
Not past due collectively assessed loans | 375,723 | 156,981 | 917 | 804 | 32 | 534,457
Other renegotiated loans | 76,913 | 27,407 | 2,093 | 5,890 | 22 | 112,325
Total renegotiated loans before provision for loan impairment | 452,636 | 184,388 | 3,010 | 6,694 | 54 | 646,782

In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Consumer and other loans to individuals | Mortgage loans to individuals | Car loans to individuals | Total
--- | --- | --- | --- | --- | --- | ---
31 December 2010: |  |  |  |  |  |
Not past due collectively assessed loans | 402,606 | 171,884 | 6,824 | 1,958 | 38 | 583,310
Other renegotiated loans | 96,571 | 54,160 | 3,299 | 10,197 | 184 | 164,411
Total renegotiated loans before provision for loan impairment | 499,177 | 226,044 | 10,123 | 12,155 | 222 | 747,721
31 December 2009: |  |  |  |  |  |
Not past due collectively assessed loans | 375,723 | 156,981 | 917 | 804 | 32 | 534,457
Other renegotiated loans | 76,913 | 27,407 | 2,093 | 5,890 | 22 | 112,325
Total renegotiated loans before provision for loan impairment | 452,636 | 184,388 | 3,010 | 6,694 | 54 | 646,782

Provisions for Loan Impairment. The analysis of changes in provisions for loan impairment for the year ended 31 December 2010 is presented in the table below:

enlarge

In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Consumer and other loans to individuals | Mortgage loans to individuals | Car loans to individuals | Total
--- | --- | --- | --- | --- | --- | ---
Provision for loan impairment as at 1 January 2010 | 221,488 | 287,059 | 38,238 | 28,775 | 4,254 | 579,814
Net provision charge for loan impairment during the year | 118,880 | 35,863 | (1,041) | 832 | (725) | 153,809
Loans and advances written off during the year | (27,439) | (2,140) | (1,112) | (328) | (81) | (31,100)
Provision for loan impairment as at 31 December 2010 | 312,929 | 320,782 | 36,085 | 29,279 | 3,448 | 702,523

In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Consumer and other loans to individuals | Mortgage loans to individuals | Car loans to individuals | Total
--- | --- | --- | --- | --- | --- | ---
Provision for loan impairment as at 1 January 2010 | 221,488 | 287,059 | 38,238 | 28,775 | 4,254 | 579,814
Net provision charge for loan impairment during the year | 118,880 | 35,863 | (1,041) | 832 | (725) | 153,809
Loans and advances written off during the year | (27,439) | (2,140) | (1,112) | (328) | (81) | (31,100)
Provision for loan impairment as at 31 December 2010 | 312,929 | 320,782 | 36,085 | 29,279 | 3,448 | 702,523

The analysis of changes in provisions for loan impairment for the year ended 31 December 2009 is presented in the table below:

enlarge

In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Consumer and other loans to individuals | Mortgage loans to individuals | Car loans to individuals | Total
--- | --- | --- | --- | --- | --- | ---
Provision for loan impairment as at 1 January 2009 | 82,708 | 75,305 | 30,077 | 12,611 | 1,584 | 202,285
Net provision charge for loan impairment during the year | 147,089 | 212,421 | 10,056 | 16,587 | 2,779 | 388,932
Loans and advances written off during the year | (8,309) | (667) | (1,895) | (423) | (109) | (11,403)
Provision for loan impairment as at 31 December 2009 | 221,488 | 287,059 | 38,238 | 28,775 | 4,254 | 579,814

In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Consumer and other loans to individuals | Mortgage loans to individuals | Car loans to individuals | Total
--- | --- | --- | --- | --- | --- | ---
Provision for loan impairment as at 1 January 2009 | 82,708 | 75,305 | 30,077 | 12,611 | 1,584 | 202,285
Net provision charge for loan impairment during the year | 147,089 | 212,421 | 10,056 | 16,587 | 2,779 | 388,932
Loans and advances written off during the year | (8,309) | (667) | (1,895) | (423) | (109) | (11,403)
Provision for loan impairment as at 31 December 2009 | 221,488 | 287,059 | 38,238 | 28,775 | 4,254 | 579,814

Loan Security. The Group Management's best estimate of fair value of collateral for past due loans as at 31 December 2010 and 31 December 2009 is presented in the table below:

enlarge

| 2010 | 2009
--- | --- | ---
In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Commercial loans to legal entities | Specialised loans to legal entities
Best estimate of fair value of collateral for past due loans, assessed for impairment on a collective basis, when collateral is:
- real estate | 130,308 | 77,818 | 96,410 | 87,299
- transportation and production equipment | 58,650 | 33,026 | 43,175 | 41,399
- goods in turnover | 53,883 | 1,415 | 53,006 | 1,710
- tradable securities | - | 5,527 | - | 13,166
- other assets | 31,663 | 118,083 | 17,360 | 56,794
Best estimate of fair value of collateral for past due individually impaired loans to legal entities, when collateral is:
- real estate | 292,844 | 79,458 | 176,438 | 322,075
- transportation and production equipment | 27,933 | 35,219 | 30,106 | 37,356
- goods in turnover | 8,161 | 136 | 1,783 | 506
- tradable securities | 2,100 | 46,769 | 40,385 | 45,253
- other assets | 12,831 | 167,062 | 2,827 | 98,478
Total | 618,373 | 564,513 | 461,490 | 704,036

| 2010 | 2009
--- | --- | ---
In millions of Russian Roubles | Commercial loans to legal entities | Specialised loans to legal entities | Commercial loans to legal entities | Specialised loans to legal entities
Best estimate of fair value of collateral for past due loans, assessed for impairment on a collective basis, when collateral is:
- real estate | 130,308 | 77,818 | 96,410 | 87,299
- transportation and production equipment | 58,650 | 33,026 | 43,175 | 41,399
- goods in turnover | 53,883 | 1,415 | 53,006 | 1,710
- tradable securities | - | 5,527 | - | 13,166
- other assets | 31,663 | 118,083 | 17,360 | 56,794
Best estimate of fair value of collateral for past due individually impaired loans to legal entities, when collateral is:
- real estate | 292,844 | 79,458 | 176,438 | 322,075
- transportation and production equipment | 27,933 | 35,219 | 30,106 | 37,356
- goods in turnover | 8,161 | 136 | 1,783 | 506
- tradable securities | 2,100 | 46,769 | 40,385 | 45,253
- other assets | 12,831 | 167,062 | 2,827 | 98,478
Total | 618,373 | 564,513 | 461,490 | 704,036

- Estimation of the fair value of collateral for past due loans, assessed for impairment on a collective basis, and individually impaired loans to legal entities as at 31 December 2010 and 31 December 2009 was estimated by the Group's lending departments using Group's internal methodology. The Group's policy on collateral requirements is disclosed in Note 31.
- Actual net realisable value of collateral may differ from the value disclosed above due to potential difficulties arising during the foreclosure which can not be predicted.

Investments in finance lease. Included in specialised loans to legal entities are net investments in finance lease. The analysis of net investments in finance lease as at 31 December 2010 and as at 31 December 2009 is as follows:

in millions of Russian Roubles | 2010 | 2009
--- | --- | ---
Gross investment in finance lease | 72,717 | 49,965
Unearned future finance income on finance lease | (21,274) | (14,380)
Net investment in finance lease before provision for impairment | 51,443 | 35,585
Less provision for impairment | (1,033) | (1,119)
Net investment in finance lease after provision for impairment | 50,410 | 34,466

The contractual maturity analysis of net investments in finance lease as at 31 December 2010 is as follows:

In millions of Russian Roubles | Net investment in finance lease before provision for impairment | Provision for impairment | Net investment in finance lease after provision for impairment
--- | --- | --- | ---
Not later than 1 year | 18,567 | (325) | 18,242
Later than 1 year but not later than 5 years | 29,303 | (657) | 28,646
Later than 5 years | 3,573 | (51) | 3,522
Total as at 31 December 2010 | 51,443 | (1,033) | 50,410

The contractual maturity analysis of net investments in finance lease as at 31 December 2009 is as follows:

In millions of Russian Roubles | Net investment in finance lease before provision for impairment | Provision for impairment | Net investment in finance lease after provision for impairment
--- | --- | --- | ---
Not later than 1 year | 10,371 | (577) | 9,794
Later than 1 year but not later than 5 years | 22,615 | (498) | 22,117
Later than 5 years | 2,599 | (44) | 2,555
Total as at 31 December 2009 | 35,585 | (1,119) | 34,466

The analysis of minimal finance lease receivables as at 31 December 2010 and 31 December 2009 per contractual maturity is as follows:

In millions of Russian Roubles | 31 December 2010 | 31 December 2009
--- | --- | ---
Not later than 1 year | 19,662 | 13,890
Later than 1 year but not later than 5 years | 41,593 | 32,234
Later than 5 years | 11,462 | 3,841
Total | 72,717 | 49,965

Economic sector risk concentration. Economic sector risk concentrations within the customer loan portfolio as at 31 December 2010 and 31 December 2009 are as follows:

| 2010 | 2009
--- | --- | ---
In millions of Russian Roubles | Amount | % | Amount | %
Individuals | 1,319,732 | 21.3 | 1,177,539 | 21.7
Trade | 1,008,025 | 16.3 | 960,385 | 17.7
Services | 1,001,330 | 16.2 | 748,240 | 13.7
Food and agriculture | 585,394 | 9.5 | 511,658 | 9.4
Construction | 404,601 | 6.5 | 408,307 | 7.5
Machine building | 317,588 | 5.1 | 347,222 | 6.4
Metallurgy | 300,806 | 4.9 | 273,814 | 5.0
Chemical industry | 216,833 | 3.5 | 186,790 | 3.4
Energy | 208,797 | 3.4 | 172,623 | 3.2
Oil and gas | 177,495 | 2.9 | 157,078 | 2.9
Telecommunications | 168,042 | 2.7 | 164,934 | 3.0
Government and municipal bodies | 153,280 | 2.5 | 94,004 | 1.7
Transport, aviation, space industry | 147,540 | 2.4 | 109,211 | 2.0
Timber industry | 49,609 | 0.8 | 43,955 | 0.8
Other | 132,838 | 2.0 | 88,085 | 1.6
Total loans and advances to customers before provision for loan impairment | 6,191,910 | 100.0 | 5,443,845 | 100.0

Included into 'services' are loans granted to holding companies and multiindustry companies.

As at 31 December 2010 the Group had 20 largest borrowers with aggregated loan amounts due from each of these borrowers exceeding RR 29 300 million (31 December 2009: 20 largest borrowers with loan amounts due from each of these borrowers exceeding RR 23 000 million). The total aggregate amount of these loans was RR 1 401 637 million or 22.6% of the total gross loan portfolio of the Group (31 December 2009: RR 1 240 189 million or 22.8%).

Interest income accrued on loans, for which individual impairment has been recognised, for the year ended 31 December 2010, comprised RR 8 322 million (2009: RR 3 297 million).

In interest income on loans and advances to customers in the consolidated income statement are included fines and penalties received from borrowers in the amount of RR 10 759 million (2009: RR 5 828 million).

The estimated fair value of loans and advances to customers is disclosed in Note 34. Currency and maturity analyses of loans and advances to customers are disclosed in Note 31. The information on related party balances is disclosed in Note 35 and 36.

## History

- 9 Securities Designated at Fair Value through Profit or Loss
- 8 Trading Securities
- 7 Cash and Cash Equivalents
- Recommend Page
- Statement of Financial Position

## My Annual Report

- Store Page
- Show Saved Pages (36)

## Tools

- Quick Analyser
- Download Center

### Key figures

- Operating Income
- Assets
- Net Profit