Копирование запрещено International Bureau of Credit Histories Principles of work Andry Kyyak (PhD), Head of Board, IBCH. KYIV June 2007

Копирование запрещено

International Bureau of Credit Histories

Principles of workAndry Kyyak (PhD), Head of Board, IBCH. KYIV June 2007


Economic results: background for banking sector growth

GDP of Ukraine.1.01.2006 – 441 452 bln. UAH1.01.2007 – 470157 bln. UAH

GDP/person1.01.2006 – 9372 UAH1.01.2007 – 9678 UAH

Average salary1.01.2006 – 1019 UAH1.01.2007 – 1277 UAH

CPI 2006 – 11,6%PPI 2006 – 14,1%Exchange rate – 1 USD-5,05 UAH


Bank system

• Quantity – 166 banks

• The central Bank – National Bank in Ukraine

• Concentration – first 10 banks 60% of assets I system; first 40 more 80% of assets in system


Most popular retail loans

• Auto loans• Mortgage loans• Loans in stores• Credit Cards• Loans for education


Retail loans boom

GDP on 01.01.2007 470, 157 bln. UAH Rate of growth :•2007 F – 7%•2008 F – 7%•2009 F – 9%

Loan portfolio on 01.01.2007 245,5 bln. UAH (rate of growth in 2006 72,57%)•2007 F – 60%•2008 F – 50%

Retail loan portfolio on 01.01.2007 77 754 663 bln. UAH (rate of qrowth in 2006 134,51%)•2007 F – 80%•2008 F – 80%

Mortgage loan portfolio on 01.01.2007 – 15 bln. UAH. (rate of growth in 2006 50%)•2007 F – 70%•2008 F – 70%

Auto loans portfolio on 01.01.2007 – 13 bln. UAH. (rate of growth in 2006 100%)•2007 F – 80%•2008 F – 80%

Other retail (consumer loans) on 01.01.2007 - 34 bln. UAH. (rate of growth in 2006 112,5%)•2007 F – 90%•2008 F – 80%


Amount of applications (average) – quantity of reports – credit reports market size (physical persons)

•Mortgage market8-10% of households can take mortgage loan. Estimated amount of 1 loan

is 100.000 UAH. Average quantity of application on mortgage loan 150.000 annually (2007-2008)

•Autoloan15-20% of households can take auto loan. Estimated amount of 1 loan is

75.000 UAH. Average quantity of application on mortgage loan 150.000-200.000 annually (2007-2008)

•Retail loan (consumer)Average quantity – 6-7 mln. Annually (2007-2008)

On 1.01.2007 the total quantity of reports (with consent of client) – 5 mln.Taking into account the rate of growth of loan portfolios in 2009 on the

market will be appr. 17-18 mln (incl. more than 1,5 mln. Reports from credit unions segment). Positive Reports (1,5-2 mln. – negative reports).


Scoring

Auto Mortgage

Credit Cards

Credits in the shops

Credits for

education

Consumer loans

Overdraft

0

10

20

30

40

50

60

Experts forecasts of increasing

during next year,

% per 2007

1 2 3 4 5 6 7

Segments

Perspectives of increasing of different segments of retail market


Scoring

AutoMortgagee

Credit

Cards


Credits for education

Consumer credits

Overdrafts

0,00

1,00

2,00

3,00

4,00

5,00

6,00

7,00

8,00

Experts estimation of perspectives by scale 1-10

1 2 3 4 5 6 7

Segments of retail market

Perspectives of different segments for banks


Average amount of credits (UAH)

Auto - 53450

Real estate - 265000 As a rule 30% is “down” by individual and it is 70% value of flat

Credits cards - 5250 There are differences for credit cards “for all” and for borrower for car or real estate (15000-20000 Hrn)

Credits at the shops - 6437,5

Credits for education - 9500

Consumer loans 6000-10000 Depends from the notion “Consumer loan” in concrete bank


Average time for credit arrangements

• Auto 5-6 days• Real estate11-14 days (Min=4, Max=Month)• Credits cards 2 days (Min=1, Max=3)• Credits at the shops 1-1,5 hours• Credits for education 3-7 days Max=7• Consumer loans 3 days From couple of hours to 5

days, depends from collateral


Why to cooperate with bureau in Ukraine

• Quantity of clients (physical persons) that never requested for credit more than 50%

• Risk of default – appr.15%

• Commercial risk – level of rejection average 35%

• Rate of growth of bad loans in banking retail loans portfolio more than 100%

• Bureau help to solve the problem with asymmetry of information and make the level of risk of default and rejection lower (5 and 10%)


Legislative requirements

• Special Law «About the organization of formation and reference of credit histories» from Junes, 23 th, 2005 #2704-IV

• Licensing requirements were adopted by Ministry of Justice in 01.2007. (IBCH has the 1 License in Ukraine)

• The supervision requirements will be adopted by MJ of Ukraine in the nearest time.

• Cooperation with bureau and changing with the information from bank to bank is not the threat for banking secrecy (according to law)

• Credit bureaus have a special data protection requirement


Clients and Products

• Bureaus can cooperate with: banks, credit unions, insurance companies

• Special source of information are state registers

• According to law bureaus can propose reports and scoring results


Variants of development: Risks

We examines the followings possible risks of success activity of bureau in Ukraine:

•A financial risk - absence of necessary capital for operating activity

•A strategic risk - unfunctioning of the system; uneffective connecting of partners

•An operating risk – absence of work of personnel «On a result»


IBCH

This year IBCH (1th half of 2007) plans to complete connecting to the followings state registers:

• Register of prohibitions (real estate)• Register of burdens (personal chattels)• Register of enterprises of Ukraine• Register of physical persons – taxpayers• Register of calculations for public utilities.• Register of the lost documents (possibly, by the end

of the year)

It will help IBCH to become yet on a level higher than the competitors and to get additional profits


IBCH

IBCH begins first from the bureau of Ukraine to inculcate the complex system of defence of information with parallel development of necessary internal procedures of defence of information (in 2007).

It will help IBCH to purchase greater legal and transparent status at a collaboration with partners, registers.


Calculation of size of base of Partners

On 01.01.06 the volume of credit portfolio of banks of partners and potential partners made are 11,29 billions UAH

On 01.01.07 the volume of credit portfolio of these banks made are 31,83 billions UAH A size of credit is 11 thousands UAH 80% borrowers gave a consent on transferring of data.

31,83-11,29=20,54 (billions UAH .) increase of portfolio. That makes about 1,867 million borrowers * 80% = 1,493 mln. records.

11,29 11,29 milliardmilliard UAHUAH

31,83 31,83 milliardmilliard UAHUAH

01.01.2006 01.01.2007

1,493 mln. records

The size of credit – 11 thousand UAH.Pluses:Growth of crediting – 30%

Minuses:Presence of permissions of

borrowers – 80%The same borrower – 20%


18

Introduction

- CREDITINFO GROUP (CIG)

- TAS FINACIAL GROUP (TAS)

- NATIONAL ASSOCIATION OF CREDIT UNIONS OF UKRAINE (NACUU)

IBCHIBCH – BUREAU OF CREDIT HISTORIES IS ESTABLISHED – BUREAU OF CREDIT HISTORIES IS ESTABLISHED IN IN UKRAINE UKRAINE BY BY THE THE THREE STRATEGIC PARTNERSTHREE STRATEGIC PARTNERS::

- Credit reports with positive and negative data on individuals and companies

- Credit bureau scoring model with statistic score card

- In cooperation with CREDITINFO UKRAINE - credit risk management tools- To multiply the profitableness of business of his founders, become an effective profitable

project, to occupy the considerable segment of market.

THE MAIN PURPOSE OF THE COMPANY IS TO PROVIDE THE MAIN PURPOSE OF THE COMPANY IS TO PROVIDE THE THE MARKET WITH STANDARD CREDIT BUREAU REPORTING MARKET WITH STANDARD CREDIT BUREAU REPORTING

PRODUCTS AND SERVICESPRODUCTS AND SERVICES::


IBCH works accordant governed requirements of Law of Ukraine «About the organization of formation and reference of credit histories» from Junes, 23 th, 2005 #2704-IV, with all

of amendments and supplements, other legislative acts.

• Credit reports for banks, credit unions, insurance companies and other creditors (6 credit reports (identification/personal, negative, classical, universal, modified and insurance) - in a mode of real time

• Application and Credit bureau scoring• Application processing• Monitoring of clients for banks, credit unions, insurance companies and other creditors• Debt management is the recommended technology of increase of efficiency of method

and process of punishment of debts. Jointly with Creditinfo• Information from state registers• Assistance to Bank at adaptation of legal base - Contracts and applications on the

credit - by inclusion of the coordinated text of the client’s permission on transfer of the information to the Bureau; assistance at development of internal provisions of Bank that regulate interaction of work process with a Bureau of Credit Histories

• Companies Database• Other products, developed specially to order of our clients

IBCH was the 1 companies, which created Expert scoring card that we proposed to our clients

Products and Services of IBCH


20

Types of credit reports

CLASSICAL REPORT CONTAINS IDENTIFICATION INFORMATION, CURRENT NEGATIVE CLASSICAL REPORT CONTAINS IDENTIFICATION INFORMATION, CURRENT NEGATIVE INFORMATION, AND ALSO SHORT INFORMATION ABOUT DEBTS OF CLIENTINFORMATION, AND ALSO SHORT INFORMATION ABOUT DEBTS OF CLIENT

UNIVERSAL REPORT CONTAINS, BESIDES THE ABOVE ENUMERATED INFORMATION, UNIVERSAL REPORT CONTAINS, BESIDES THE ABOVE ENUMERATED INFORMATION, CURRENT STATUS OF CLIENT ON PAYMENTS, ALSO INCLUDS HISTORICAL CURRENT STATUS OF CLIENT ON PAYMENTS, ALSO INCLUDS HISTORICAL INFORMATION AND INFORMATION ABOUT POSITION OF BORROWER AS GUARANTOR INFORMATION AND INFORMATION ABOUT POSITION OF BORROWER AS GUARANTOR OR CO-BORROWEROR CO-BORROWER

MODIFIED REPORT CONTAINS INFORMATION ABOUT OTHER SUBJECTS, AND ALSO MODIFIED REPORT CONTAINS INFORMATION ABOUT OTHER SUBJECTS, AND ALSO HISTORICAL INFORMATION ABOUT IDENTIFICATION DOCUMENTS AND LOCATIONHISTORICAL INFORMATION ABOUT IDENTIFICATION DOCUMENTS AND LOCATION

BLANK REPORT IS REPORT ABOUT CLIENT WHICH INCLUDE INFORMATION THAT BLANK REPORT IS REPORT ABOUT CLIENT WHICH INCLUDE INFORMATION THAT ABSENT IN DATABASE OF CREDIT BUREAU + INFORMATION ABOUT THE AMOUNT OF ABSENT IN DATABASE OF CREDIT BUREAU + INFORMATION ABOUT THE AMOUNT OF QUERIES + SMALL ID INFOQUERIES + SMALL ID INFO

NEGATIVE REPORT CONTAINS ONLY NEGATIVE INFORMATION ABOUT CLIENT. THIS REPORT NEGATIVE REPORT CONTAINS ONLY NEGATIVE INFORMATION ABOUT CLIENT. THIS REPORT GETS THOSE PARTICIPANTS OF BUREAUS WHICH DO NOT GIVE POSITIVE INFORMATION FOR GETS THOSE PARTICIPANTS OF BUREAUS WHICH DO NOT GIVE POSITIVE INFORMATION FOR EXCHANGEEXCHANGE


21

Reports and databases include

BLANK INDIVIDUAL NEGATIVE CLASSICAL UNIVERSAL MODIFIED

ACTUAL ADDRESS x x x x X

HISTORICAL ADDRESS x x X

CLASSIFICATION OF BORROWERS

x x X

NEGATIVE CURRENT DATA x x x X

NEGATIVE HISTORICAL INFORMATION

x x X

SHORT TOTAL INFORMATION x x X

IDENTIFICATION DOCUMENTS x x x x X

DETAILED INFORMATION (CURRENT)

x X

DETAILED INFORMATION (HISTORICAL)

X

OTHER SOURCES OF DATA x

NUMBER OF QUERIES (IN THE PAST)

x x x x x x


22

Price policy

The costs of credit reports are determined in the dollars of the USA on an individual scale

TariffsAmount of credit reports, given out for an operating

month

Price for a individual credit

report

Price for a negative credit

report

Price for a classical credit

report

Price for a universal credit

report

Price after modified credit

report

1. 0 – 100

0,20

5,00 1,00 1,70 4,00

2. 101 – 500 4,80 0,95 1,63 3,80

3. 501 – 1.000 4,60 0,90 1,55 3,60

4. 1.001 – 2.500 4,40 0,85 1,47 3,40

5. 2.501 – 5.000 4,20 0,80 1,39 3,20

6. 5.001 – 10.000 4,00 0,75 1,31 3,00

7. 10.001 – 15.000 3,80 0,70 1,23 2,80

8. 15.001 – 25..000 3,50 0,65 1,15 2,60

9. 25.001 – 40.000 3,20 0,60 1,07 2,40

10. More than 40.000 2,99 0,49 0,99 2,19

All of the indicated prices are not included by VATS

To 2008 year scope prices on reports - Blank - 0.20Negative - 4.0

Classical - 0.75Universal - 1.5Modified - 3.0


Stages of cooperation

1. Signing of the Contract.2. Reception of the engineering specifications.3. To appoint the responsible persons from the Partner (IT-experts,

experts on crediting and risks). Creation of working group in structure of experts of the Parties.

4. Connection to a Program Complex of the Bureau (for work in a on-line mode).

5. Creation of the communication module for work with system of the Bureau in a off-line mode.

6. Formations of data for transfer to the Bureau.7. Testing of work of the system. 8. To appoint the corresponding structural divisions and the

personnel of the Partner to which duties will be assigned to provide cooperation of the Parties.

9. Development of internal procedures for interaction with Bureau and their inclusion in own business-processes, acceptance of corresponding positions.

10.The coordination and signing of the Contract for granting information services.


The order of introduction in Bank of work technology with «International Bureau of Credit Histories »

Stage 1. The approval of the Order of Bank On introduction in Bank of the procedure with International Bureau of Credit Histories.

Stage 2. Creation of group on introduction in Bank of work technology with IBCH and appointment of the Head of group.

We recommend to include 4 or 5 persons in structure of group :– The representative of Department (management /

department) retail crediting (it is recommended to appoint as the Head of group because the given Department will be, in the main , the consumer of IBCH services);

– The representative of Department (management / department) risk-management of Bank;

– The representative of Department (management / department) information technologies;

– IBCH representatives (the expert on work with Banks and the expert on information technologies).


A procedure of applying the technology of work with “International Bureau of Credit Histories” in banks

Stage 3. Carrying out preparatory work in the bank for the beginning of testing of the work with IBCH, organization of testing and instruction in technology of working with the bureau of the corresponding bank employees.

3.1. Determination of the executive officers, who will be authorized to make inquiries ant to receipt credit histories of the bank clients;

3.2. Determination of working places, where (technically) an inquiry and receipt of the credit history can be made;

3.3. To determine, develop and adjust the technology of work with credit reports in the bank;

3.4. To confirm regulations of work of the bank with IBCH;3.5. To develop the technology of preparation of information for

forwarding it to IBCH, including the procedure of carrying the consent of the client to provide the data to IBCH;

3.6. To develop and confirm instructions for the corresponding groups of the bank specialists;

3.7. To provide instruction of the bank’s personnel, that takes part in the work with the bureau.


A procedure of applying the technology of work with “International Bureau of Credit Histories” in banks

Stage 4. Experimental-industrial exploitation of the work of the bank’s system with IBCH (Period – from 1-3 weeks)

4.1. Carrying out of the experimental-industrial exploitation of the system.

4.2. Drawing up a report on acceptance of the system to industrial exploitation with a list of remarks and defects (in the system, in technology, in documents), discovered during the work with system in experimental-industrial period and terms of revision and correction of this defects.

4.3. Drawing up a report on acceptance of the system to industrial exploitation.

Stage 5. Approval of the bank’s order to apply the system of the work with IBCH to the industrial exploitation.

Stage 6. To develop and confirm the technology and payment for the services of IBCH.


Sequence of work in front-office of the IBCH system

Open the pageOpen the page https://secure.credithistory.com.ua/FrontOfficehttps://secure.credithistory.com.ua/FrontOffice//After loading supply login and password, and After loading supply login and password, and

then press “Enter”then press “Enter”


Scoring

Auto Mortgage

Credit Cards


Credits for

education

Consumer loans

Overdraft

0

10

20

30

40

50

60

Experts forecasts of increasing

during next year,

% per 2007

1 2 3 4 5 6 7

Segments

Perspectives of increasing of different segments of retail market


Scoring

AutoMortgagee

Credit

Cards


Credits for education

Consumer credits

Overdrafts

0,00

1,00

2,00

3,00

4,00

5,00

6,00

7,00

8,00

Experts estimation of perspectives by scale 1-10

1 2 3 4 5 6 7

Segments of retail market

Perspectives of different segments for banks


Bor

row

erB

orro

wer

Fro

nt-o

ffic

e of

F

ront

-off

ice

of

the

Ban

kth

e B

ank

Ris

k-R

isk-

man

agem

ent

man

agem

ent

Fro

nt-o

ffic

e F

ront

-off

ice

of I

BC

Hof

IB

CH

Bac

k-of

fice

Bac

k-of

fice

of I

BC

Hof

IB

CH

Filling in a form for Filling in a form for creditcredit, , written consent written consent

on forwarding the on forwarding the information to the information to the

BureauBureau

Processing of the formProcessing of the form, , forming of documentsforming of documents

Following the internal Following the internal procedures, a decision procedures, a decision on the further actions is on the further actions is made made - - to give a credit to give a credit

at once, at once, выдача в выдача в месте обращения за месте обращения за кредитом, кредитом, to submit to to submit to

a credit committeea credit committee..

DecisionDecision::

no

Refusal in Refusal in creditingcrediting, ,

recommendation recommendation to have a to have a guarantorguarantor

Signing an Signing an agreement, agreement,

written consent written consent on forwarding on forwarding the the information to the information to the

BureauBureau

yes

Forwarding the Forwarding the identificator to the identificator to the

authorized authorized specialist of the IT specialist of the IT

departmentdepartment

In t

he c

ase

of

wri

tten

conse

nt

ExitExit,,searchsearch, , receipt receipt of the reportof the report

Bac

k-of

fice

of t

he

Bac

k-of

fice

of t

he

Ban

kB

ank

(( IT

dep

artm

ent

IT d

epar

tmen

t ))IB

CH

sys

tem

IBC

H s

yste

m

Forming of file and Forming of file and forwarding the data forwarding the data to the IBCH system to the IBCH system

Control over the receiving of the data, permanent support of the usersControl over the receiving of the data, permanent support of the users

Readiness to help Partners on every stage of creditingReadiness to help Partners on every stage of crediting

Receiving of the Receiving of the data, analysis and data, analysis and report on receivingreport on receiving

Questions on the work of the system

Giving a creditGiving a credit

Receiving of Receiving of periodical periodical

payments from payments from the borrowerthe borrower

Forming of file and Forming of file and forwarding the data forwarding the data to the IBCH systemto the IBCH system

Receiving of the Receiving of the data, analysis and data, analysis and report on receivingreport on receiving


IBCH – market share

• On March 2007 IBCH had a 22 signed contracts with banks, credit unions and insurance companies

• Till end of the year IBCH will cover more than 30% of market

• Till end 2008 – more than 50% of market


Партнери Бюро станом на 1червня 2007 року

Банки:1. ТОВ «Укрпромбанк»2. ТОВ «Банк ренесанс-капітал»3. ТОВ «Актив –Банк»4. АБ «АВТОЗАЗБАНК»5. Банк НРБ6. ЗАТ «Родовід банк»7. ТАС –Комерцбанк8. ТАС –Інвестбанк9. КБ «Бмбанк»10. Ва-Банк11. OTP – Банк12. КБ ТОВ «Місто Банк»13. КБ «Євробанк».14. Экспобанк15. ВАТ «Донгорбанк»


Страхові та Лізингові компанії

1. СК «АСКА»2. ЗАТ «Європейський страховий альянс»3. Страхова Група ТАС4. Страхова компанія ТАС5. ТОВ «Євро-лізинг»6. Асоціація лізингодавців України


Кредитні спілки

1. КС «Фортеця»2. КС «Азовська кредитна

Компанія»3. КС «Перше кредитне

товариство»4. КС «Гільдія підприємців

Донбасу»5. КС «Інвесткапітал» 6. КС «Карат»


Організації, якими прийнято рішення про співпрацю

1. Індустріал –Банк2. Банк «Руський Стандарт»3. Укрсиббанк4. ПУМБ5. Індекс – банк6. Морський транспортний банк7. КС «Кредит плюс»


Партнери, які повністю готові до промислової експлуатації

• ТОВ «Євро-лізинг»• ТОВ «Укрпромбанк»• КС «Азовська кредитна Компанія»• КС «Перше кредитне товариство»• ЗАТ «Родовід банк»• ТАС –Комерцбанк• ТАС –Інвестбанк• OTP – банк• КС “Фортеця”• КБ “БМ Банк”• АКБ “АвтоЗАЗбанк”


THANK YOU

www.credithistory.com.ua

Documents

Копирование запрещено International Bureau of Credit Histories Principles of work Andry Kyyak (PhD), Head of Board, IBCH. KYIV June 2007