The young and full of energy Aliona Levca joined FinComBank S.A. in August 2018, and just in eighteen months, became the Chairman of the Board of the Bank. In the challenging environment, the Administrative Council considered that her knowledge, her amazing perseverance and determination, are best suited for this position. Since it was one of the possible outcomes of the future events, she accepted the proposal, clearly realizing and understanding her mission.
In an exclusive interview with the editor of the Banks & Finance magazine, the second Chairman of the Board of FinComBank in history spoke about the assigned tasks, further development of the bank, that will ensure its rapid transformation into a full-fledged digital bank.
B&F: Mrs. Levca, what, along with congratulations on your appointment as Chairman of the Board of FinComBank, did your colleagues, friends and relatives wish you?
Aliona LEVCA: Many congratulated me, and, by the way, sincerely, warmly and with all their heart. Although, it seems to me, not everyone understands that not only congratulations are in order, but compassion and sympathy are also more than welcome.
“Chairman of the Board of the Bank” – most people see capital letters and big words, but only a few are aware of the full depth of responsibility and the amount of work that falls on the person on this position.
Along with congratulations, one should wish strength, health and unquenchable energy that will suffice to solve the tasks that the shareholders have set for me, and the Bank as a whole.
B&F: Have you been working at FinComBank for a long time?
Aliona LEVCA: Since August 2018 and based on the standards and principles of the banking sector, one can be said it is for very little time.
B&F: But you are not a beginner! How long have you considered the proposal to head the bank?
Aliona LEVCA: You know, there is a good theory on this subject, according to which all important decisions are made in just a few seconds. The afterwards deliberation is just a search for excuses or arguments for agreement, although the decision itself has already been made. This is best illustrated when you toss a coin. If it falls on the intended side, then you feel something tickling from within - “that’s it”! If it falls on the “wrong” side, it becomes clear that it was not even worth making a guess, since that road is altogether wrong.
So, my consent was given almost immediately and with full awareness of all the ensuing consequences.
B&F: Did you even consult with close and dear people?
Aliona LEVCA: I made the decision quickly enough, so I did not have time to consult, seek for excuses or arguments in favour. Yes, post factum I discussed all the aspects in detail with my closest friend, life and business partner before working at the Bank - my husband. I can say that for me he is the most important person and the best adviser.
B&F: Did he support you 100%?
Aliona LEVCA: He is the mountain that stands by my side, protecting and supporting, helping and pushing in the right direction.
B&F: Deciding to appoint you as the Chairman of the Board, the shareholders probably set specific tasks for you. What do they expect from you as Chairman of the Board of the Bank?
Aliona LEVCA: Basically, they want to solve the same problems and achieve the same goals that were set previously. I believe that they would like the Bank to move along the planned route much faster.
Few years ago, the bank has set the perfect aim and benchmark - the customer’s comfort! I’ve worked for a long time as a business consultant and developed at professional level a habit for evaluating how the business-processes in a particular organization function. Every time I entered a bank office, I had a feeling of confusion - why is everything arranged like this, why customers must face constant inconveniences?
Any client is upset and nervous because of the queues, waste of time, senseless need to go somewhere, decide something with the bank clerks in the multitude of windows, filling in incomprehensible and often unnecessary documents. Do you agree that all of these do not fit in with the current rhythm of life and do not correspond to the lifestyle of a middle-aged person, or moreover to the lifestyle of the young people advanced in modern IT technologies? Well, we believe that switching traditional bank posts to remote online services, is capable to solve most of the named problems.
Every month, more and more of our products and services are transferred to the online environment. In fact, we strive to ensure that our client goes to the bank physically only once. After that, he could carry out all the operations online. We have wonderful Internet Banking, and the FinComPay Business mobile application is one of the most practical and convenient mobile applications on the local banking services market.
As I was interested in the field I’ve tried several versions of the mobile applications from domestic banks, this allows me to affirm with full confidence that the FinComPay Mobile Banking application, launched quite recently, has every chance of taking a leading position in terms of comfort for users. It is very practical and user friendly, there is no need to scroll through 20 tabs to find the desired function or information or to perform an operation.
The approach of having the client’ comfort placed on top of the list, is the basis of the bank's further development. Our main purpose is to be close to the client, to understand his needs and concerns, to help him, trying in many cases to anticipate all possible requests. Online services in this regard have a tremendous advantage, being fit exactly to these needs. There is a good term - digital bank, and we are on the path towards this kind of future.
B&F: What about tasks such as return on assets (ROA), return on capital (ROE), a growing number of customers, volume of loans and portfolio quality?
Aliona LEVCA: I believe them to be consequences.
B&F: You mean that these indicators are a given if the clients feel comfortable with the Bank?
Aliona LEVCA: Everything is very simple. Where does the money come from?
B&F: Probably primarily from customers.
Aliona LEVCA: And when do they entrust their money or business to a bank? Naturally, when it is convenient. It is unlikely that the client will start or continue a relationship with a bank, having in mind previous unpleasant experience. But when there is a user-friendly mobile application he vividly reacts to, considering it timesaving and even, if you like, somewhat cool, this is a completely different relation between the client and the bank, guaranteeing both income and profit.
B&F: Can we say that the new Chairman of the Board sees the potential and reserve for the further development of FinComBank, in what is convenient, interesting and useful to its customers?
Aliona LEVCA: This is certainly the direction of the external development of the bank. As for the internal vector, there are always reserves that can be used to advantage. In some cases, they are not even reserves, but rather strengths of the organization.
And the strongest component of all is the bank's united team. With some minor adjustments of the work of the bank's employees we will be able to achieve even more impressive results.
I would like to underline financial performance indicators of FinComBank at the end of 2019. No big words spoken, I would say that, taking into account our capital and assets, the indicators demonstrate decent performance. If we take as an example the net profit on assets and bank capital, then we firmly hold the fourth and fifth positions in the banking system. At the same time, nothing supernatural was done, it was the usual teamwork of like-minded people - clear and coherent. I would like to mention that for 2020 the bar for these indicators has been raised by us even higher.
B&F: You say “bank team”, but how many employees are there?
Aliona LEVCA: Today that is a little more than 650 active employees, of which about 40% - in the central office, and 60% - in the structural divisions and FinComBank network throughout the country.
B&F: Does the achievement of financial results involve the expansion in 2020 of the bank staff and structural divisions?
Aliona LEVCA: No, because our focus on digital bank does not include any further expansion of the physical network. We are already on the fourth place in the system with this indicator, having 88 points of presence.
Our services are available in all major regions, cities and even where the presence of other banks is limited so far. Therefore, at this stage we do not see arguments in favour of geographical expansion. Our expansion will not be due to the physical presence of the bank, but due to a wide range of products and services, which soon will be transformed into online services.
I can say that we are constantly expanding the range of the online products, and at the moment we have as online services – card application and processing, including premium and children’s cards, P2P transfers from card to card, receiving international transfers to a card or account, payments through FinComPay Internet Banking, processing of consumer credits, including the credit cards. All online applications for granting credits to individuals are approved for no more than five minutes. The client receives a SMS with a preliminary decision on granting a loan– within minutes and there is no need to come to the Bank.
B&F: But after preliminary approval for the first time is it necessary to come to the bank?
Aliona LEVCA: Of course! This is a requirement provided by the legislation and regulations of the National Bank. Client identification is a prerequisite; it cannot be done remotely so far.
B&F: Does the bank feel a decline in the mood of depositors to place their available funds due to the fact that the regulator has lowered the base rate from 7.5% to 5.5%?
Aliona LEVCA: I must say that such states of mind have been noted among depositors for quite some time. We see on the market a heterogeneous demand for credits and a clear decrease in the public interest towards bank deposits.
It is true that if we look at our tendencies, comparing them with the situation on the markets of Moldova’s western neighbours, we realize that the situation will worsen. Fortunately, we have positive rates so far.
B&F: That is because other types of financial instruments are simply missing on the Moldovan market. And as soon as they appear, banks will have an outflow of money from deposits.
Aliona LEVCA: We should not forget that at present, mandatory reserves amount to 41.5% in the national currency, which seems to be an excessively high level of securitization applied by the regulator.
B & F: Do you want to say that the NBM will reduce the obligatory reserves in case of money outflow from the deposits?
Aliona LEVCA: I think so, because it’s completely logical. Indeed, one of the reasons for such high standards is the excessive liquidity on the market. And, in order to sterilize it, the regulator also resorts to reserving, among other instruments.
Our bank currently has a considerable base, that, in my opinion, is enough to move from the current rules to other financial indicators of regulation, which will be much more sparing for banks. Also, we look forward to intensifying external loans, since, due to the current rating of the country, we practically cannot attract external financing on acceptable terms.
Currently, Moldova’s rating, I am sorry to say that, is at the level of Iran. Therefore, if everything is going to be well, and most importantly stable, then Moldova’s attractiveness for potential investors will certainly improve, allowing to obtain external resources on favourable terms for both - the state and the corporate structures, including banks.
In the meantime, FinComBank has significantly exceeded its liquidity ratio. We do not experience any liquidity problems either in MDL or in foreign currency. In this situation, attracting external resources is not entirely advisable. I would say that the development of the Bank in this situation is limited by the capital, and not by the liquidity.
B&F: The average credit amount in 2019 of the bank was around 320 thousand MDL. How convenient is it to work with this category of borrowers?
Aliona LEVCA: Very convenient, and do you know why? Because due to law average amount, the bank has a small exposure to risks. We are proud of the credit portfolio’s quality, the indicator of our bank being the best in the system. We have achieved this thanks to our well-thought-out development strategy.
FinComBank mainly offers credits to individuals, as well as to small and medium-sized businesses. We have a very diversified portfolio of credits, most of which are provided through an automated approval system.
B&F: What innovation will the bank launch in 2020?
Aliona LEVCA: We are now actively moving towards electronic payment tools. This trend is increasingly spreading both on Western markets and in Eastern neighbourhoods. At the moment, payment instruments that have already been introduced on the Moldovan market have very limited functionality, especially in regard to their use outside the country. One of our projects in this direction is related to the international payment system, which will give FinComBank’s electronic tools several advantages.
Along with other important projects, we continue to develop the Clickpay.md platform, which is innovative and unique on the Moldovan market. Thanks to Clickpay.md, transfers from card to card, knowing only the recipient's mobile phone number, became a reality. We continue to develop the T2C service (Receive international money transfers online to a card or account). Recently, we launched such a possibility for the Zolotaya Korona money transfer system, while for the last 2 years we have been successfully working based on this principle with the RIA Money Transfer, Contact and Unistream systems. We are planning further development of this service.
B&F: Do you have one, two or three tasks that need to be solved in the first 100 days of the chairmanship?
Aliona LEVCA: If there were only three, I would be happy (laughs sincerely and loudly). There are many more. Any of the directions you take, it has an entire list of tasks, and there is a plan that I will have to implement with the team. It is clear that if you are hinting at financial results with your question, - of course there are some, since any changes in the bank, no matter how high they are, cannot cancel the good return on capital and assets.
B&F: Does this mean that the profit in 2020 will be close to the value of 100 million MDL?
Aliona LEVCA:Yes, you are right, we can say that it will be approximately of this amount. The planned values would be even higher if the base rate changes of December 11, 2019 did not occur - they affected our profit forecasts. But still, we stayed within the framework of our long-term development strategy for three years, which implies approximately such control figures.
B&F: What kind of denouement is expected for the package of shares put up for sale on the public market: is it more likely that they will be acquired by the investor with the permission of the NBM, or will the bank have to buy the shares in its own treasury?
Aliona LEVCA:We know that there are real buyers for these shares.
B&F: You talk about them in the plural. Does this mean that there are several?
Aliona LEVCA:We do not have reliable information about the current stage in the process of obtaining the relevant permits and the specific plans of each of the potential buyers. At the same time, we understand that it is possible that the bank will have to buy back the shares in case none of the potential investors dare to buy this packet. Such a probability exists; it has been calculated in detail by the risk specialists. And here I anticipate your question, will we remain with enough capital in this case? I can say that the bank’s capital will remain within the framework of the sufficiency standards established by the regulator’s norms.
B&F: But the shareholders have the opportunity to declare a closed emission to help their bank, don’t they?
Aliona LEVCA:If we buy back the shares, this does not mean that we will stop there. For us it would be a compelled measure. In the future, we will continue to search for a strategic investor in order to develop our bank together. But this will not be a matter of the Board, but of the shareholders, based on their vision regarding the future structure of the shareholders and the development prospects of FinComBank.
B&F: Did the potential investors, who are attracted by the shares sold on the stock exchange, carry out their assessment of the bank?
Aliona LEVCA:Of course. Given the fact that they continue to express their interest, we can say that they liked what they saw.
B&F: Thank you for the interview! The editors of the magazine wish you successful implementation of your tasks on the further development of FinComBank.
Inset: FinComBank's new Chairman of the Board, a lawyer by speciality, Aliona Levca graduated from the Faculty of Economic Law at Moldova State University, and also holds MBA and DipIFR diplomas. Immediately after graduation, she left for Moscow, where she worked in the field of management consulting, together with many companies in Moscow and large regions of Russia in the segment of business optimization and restructuring.
After the projects developed in Russia, she returned to Moldova, and worked closely with an international consulting company, assessing and analysing the market of the financial institutions. She studied the activities of banks on the European, Euro-Asian and Asian markets. Aliona Levca participated in the preparation of analytical information for major financial donors, including the European Bank for Reconstruction and Development and the European Investment Bank.
“I had a chance to work with a large number of banks in these regions,” the new top manager of FinComBank sums up her experience.
Aliona Levca also managed to try her skills as an entrepreneur, opening her own business in management consulting. The company worked closely with organizations form Moldova and Romania.
The work in the bank for the young and effective manager was a real challenge, accompanied by a great desire to try herself in a new capacity.
“I read on the webpage about the job opportunity for the position of financial director and I sent my resume,” she recalls. Speaking about her work at the bank as a financial director, she draws attention to the financial results of the bank for 2019, indicating that they, together with the team, achieved enviable performance.