Andrey Kostin: USC has been operating as a financial pyramid over the past decade
In some segments, the losses were twice as high as declared
When assessing the financial state of the United Shipbuilding Corporation (USC), VTB Bank revealed large annual losses and large annual borrowings. “It is clear that the company has been operating as a financial pyramid over the past decade. Every year was actually unprofitable. They were accumulating borrowings and this knot should be cut at some stage,” Andrey Kostin, President and Chairman of the Management Board, VTB Bank, said at the briefing in the framework of the Eastern Economic Forum.
According to Andrey Kostin, the USC financial audit is to take six months, so only preliminary results can be declared so far. “In fact, there is no appropriate reporting. Each project should be checked individually. We have now started to check certain positions and found out that the losses were twice as high as declared,” said Andrey Kostin adding that VTB intends to work on improving the USC situation.
At the first stage, the state assistance is being discussed, according to Andrey Kostin. “Then we will be ready to take responsibility for new financing, for improving the economy, for projects to be implemented only under market conditions, which is important,” he said.
Among the first steps to be undertaken by the new management of USC Andrey Kostin mentioned audit, additional capitalization and revision of the management system with the production modernization and introduction of new technologies to be undertaken in the future. In the coming year, one and a half modernization projects are to be implemented as well as determination of areas where modernization is to be carried out, which enterprises need modernization, what needs to be done, whom is to do it so that to begin introduction of new technologies or in two years, or, perhaps, the construction of new shipyards, summarized the speaker.
