Annual report 2011 - VTB

VTB BankNotes to the Consolidated Financial Statements – 31 December 2011 and 2010(in billions of Russian Roubles)42. Business Combinations (continued)In December 2011 the Group obtained control in several interrelated companies by acquiring a 100% ownershipshare in "Consolidated companies", OJSC including: "Kornet", OJSC (94.2%), "Moscow Inter-Republic Winery",OJSC (94.1%), "Inter-Republican Winery Trading House Limited", OJSC (95.6%).The valuation of assets and liabilities, except for brands and trademarks, was carried out by the Group’s internalappraisers. The valuation of brands and trademarks was carried out by independent appraisers.The fair values of identifiable assets and liabilities of this group of companies at the acquisition date were as follows:Fair valueAssetsInvestments in associates and joint ventures 0.5Premises and equipment 3.5Intangible assets (brands and trademarks) 0.5Other assets 1.2Total assets 5.7LiabilitiesDue to other banks 1.6Customer deposits 0.5Deferred tax liability 0.4Other liabilities 3.1Total liabilities 5.6Fair value of identifiable net assets of subsidiary 0.1Goodwill arising from the acquisition:Consideration paid 0.0Non-controlling interests (proportionate share of the acquiree’s identifiable net assets) 0.1Less: fair value of identifiable net assets of subsidiary (0.1)Goodwill arising from the acquisition –If the acquisition of the OJSC “Consolidated companies” had taken place at the beginning of the year, the net profit ofthe Group and operating income would not have been materially different.43. Capital Management and Capital AdequacyThe Group’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence andto sustain future development of its business.Capital adequacy ratio in accordance with CBR requirementsThe CBR requires Russian banks to maintain a minimum capital adequacy ratio of 10% of risk-weighted assets,determined in accordance with CBR’s requirements. In other countries the Group members comply with theregulatory capital requirements of the local central banks or other supervisory authorities.During 2010 and 2011 the Bank’s capital adequacy ratio in accordance with CBR requirements exceeded theminimum level and as at 31 December 2011 and 2010 was as follows:31 December201131 December2010Capital 443.3 529.7Risk-weighted assets 4,017.9 2,347.7Capital adequacy ratio 11.0% 22.6%96