FINANCIAL PLANNING IN UNICREDIT BANK RUSSIA

AGENDA

About a company Budget process before implementation Project targets and scope Selection of solution Project roadmap Project results Development of the system

Стр. 3

UniCredit Bank: in Russia since 1989 (International Moscow Bank before 2007). Starting from 2005 Bank is part of UniCredit Group

Key performance indicators:106 branches in Russia and 1 Representative office in

BelarusAround 4 000 employeeMore than 1 495 000 retail customers *More than 30 800 corporate clientsRatings: BBB (Fitch), ВВВ- (Standard & Poor’s)Total assets: RUR 941.50 billion *Equity: RUR 140.53 billion *UniCredit Bank has General Licence for banking

operations №1 of Bank of Russia

*As of 30.06.3014.

About a company

Стр. 4

Budget process before implementation of Oracle Hyperion Planning

Tool Microsoft Excel model based on collection of Excel spread sheets

and Pivot tables as aggregation tool

Limitations Relatively long term budget cycle Low number of iteration during coordination of budget data Significant time constraints for support and administration of model Not sufficient granularity of the model Lack of data quality, necessity to input same data several times for

usage in different parts of the model

Solution Implement modern IT system to eliminate limitations mentioned

above and realize management requirements foe reporting and budget processes

Стр. 5

Targets and scope of the project

В части обеспечения процесса бюджетного процесса

Decrease resources required for technical calculation of the model

Increase detailing of budget informationCreate united budget information sphere and support

simultaneous work of users in the modelAutomate budget coordination process Implement Plan – Actual analysisDevelop reporting portal with pre defined and ad-hoc

reports for different categories of usersDevelop Forecast model

Selection of Solution

IT TOOLCriteria:

Usability for end usersPowerful modelling and analysis tools Time and sources for implementationSimple build in data integration toolsReporting systemTotal cost of ownership

Choice: Oracle Hyperion Planning

VENDORCriteria: availability of highly qualified project team with

experience of successful project implementation with similar complexity

Choice : LANIT

Стр. 7

Project Roadmap

Terms Start: April 2003 Finish: December 2003

Project phases working days 1. Coordination of methodology 43 2. Development 86 3. Testing phase 44 4. Commercial operation 24

Project team LANIT team: 3-5 persons depended on project phase Bank team: 3 persons

Budget of the project In line with initially approved budget

Стр. 8

Project Results

Results: Implementation od Budget system based on Oracle Hyperion

planningTrained users and administrators of the model Integration of Budget system with management information systemBudget 2004 was formed in new system

Main modules of Budget model:Planning of business in detailed per clients, units and products

based on funding transfer pricing principlesAdministrative expenses are planned on units levelHR expenses are planned on personal levelAllocation of expenses from cost centres to profit centresProfit sharing agreementsFinancial and management reportingLiquidity and interest Gap analysisForecast

UCBR Budgeting Model

Data Input

Actual data import (monthly)

GAE Planning

Forecasting (top-down, bottom-up)

Bank’s products planning

Financial statements:

Applying FTP policyShadow accounting

Cost allocations

Balance sheet

Profit & Loss

Management accounting:

Profit-center profitability

GAP analysis

ICT Budget, Premises Budget…

Business Area Report

Стр. 10

Budget model Support

Budget system is supported by Planning team with involvement of IT for granting users access and HW support

Update of model is done by Planning team:Modification of dimensionsUpdate and development of calculation scriptsDevelopment of new data input formsDevelopment of new reporting forms

Bank Development

Parameter 2002 г. 2014 г.

Number of Branches

14 106

Headcount 900 4000

Number of clients More than 43 ths Более 2 495 ths.

Total assets RUR 80 bln RUR 941.5

Capital RUR 4.8 bln RUR 140.5 bln

12

Budget Approach Development

Top-DownBottom-Up

Budget Structure Development2003 2014

Planning of Business per clients, units and products based on FTP principles

No planning on client level, reserved analytical dimentions eliminated from budget model. Planning is done business sebsegment level

Admistrative expenses are planned on unit level

Implementstion of additional functionality for Cost management unit veing responsible for particular cost category

HR expenses planned on the level of single employee

HR expenses are planned on Unit level based on date from HR system

Cost allocation system from cost centers to profit centers

Simplifiaction of allocation rules, update of allocation rules in accordance with new organizational structure

Profit sharing agreements Substituted with «Shadow accounting» reporting

Liquidity and Interest Gap analysis Out of the Budget model scope

Forecasting module based on trend analysis Integration of Forecast model with Excel based reporting for coordination with Business lines. Forecast based on Budget adjustment principles.

Questions?