Standard & Poor’s Confirms MDM Bank Corporate Governance Score at CGS-6+

04.02.2008 17:46

Today Standard & Poor’s issued its annual update of the Corporate Governance Score (CGS) for MDM Bank, confirming the Bank’s score of CGS-6+. The Bank’s score on the Russian national scale was also unchanged at 6.7. MDM Bank remains the only Russian financial institution to receive a Corporate Governance Score from the Standard & Poor’s rating agency, and shares second place with two other large Russian corporates.

Although MDM Bank is a privately held financial institution, the S&P analysis approaches the Bank’s corporate governance practices as if it were about to be publicly traded and widely held. In this year’s review, the agency noted, “several important improvements, particularly in the area of internal audit, and social and environmental performance.”

Standard & Poor’s also highlighted the following strengths in corporate governance at MDM Bank:

• The positive role of the majority shareholder, who is not exposed to significant conflicts of interest and promotes strong governance standards at the Bank. A board process mediates the shareholder’s influence.
• The positive influence of the Bank’s strategic minority shareholders, which represent an important source of expertise for the Bank. They also effectively balance the influence of the majority owner.
• A strong Board composition. Each of the three minority shareholders has a representative on the seven-seat Board, and three seats belong to independent directors. There is a strong skill mix and an independent, prominent finance professional chairs the Board.
• High level of transparency and a strong audit process. The Bank pursues active investor relations policies.
• A strong executive compensation plan, in which key performance indicators are based on targets defined in the strategy.

Oleg Vyugin, Chairman of the MDM Bank Board of Directors, commented: “Corporate governance has long been a high priority for the Board and the management of MDM Bank, and I am pleased that we remain rated among the top companies in Russia. By institutionalizing strong corporate governance practices, MDM Bank is ensuring the sustainability of the value it creates for all its stakeholders.”

The full text of the S&P Corporate Governance Score can be found on www.standardandpoors.ru.

MDM Bank was founded in December 1993 and holds a General Banking License issued by the Central Bank of Russia (#2361 dated 13 February 2003). MDM Bank is one of the most dynamically developing banks in Russia and is among the top Russian banks according to assets and equity. Today, MDM Bank is a modern universal financial institution offering a full range of services to its clients.
MDM has one of the highest credit ratings among privately-owned Russian banks – Standard & Poor’s (BB, stable), Fitch Ratings (BB, stable) and Moody’s (Ba1, stable) – and is the only Russian financial organization that has been given a public corporate governance rating by Standard & Poor’s (6+).
Standard and Poor’s awarded MDM Bank the highest ranking in its study of ‘Transparency and Disclosure by Russian banks’ in 2006 and 2007. The Bank was also regarded by Euromoney magazine as “one of the leading banks in Russia and Emerging Europe, applying the most advanced standards of corporate governance.”
MDM Bank has received a number of awards from Global Finance magazine:
2005 – ‘Best Domestic Bank’ and ‘Editor’s Special Award for Transparency’.
2006 – ‘Best Forex Bank’, ‘Best Domestic Bank’, ‘Best Domestic M&A Arranger’, and ‘Best Bank in
Corporate Governance’. In October 2006, Euromoney magazine awarded MDM Bank ‘Leading Bank in Corporate Governance in Emerging Europe’.
2007 – ‘Corporate Governance Editor’s Award,’ and ‘Best Forex Bank.’

Inquiries:
Investor Relations +7 495 221 30 75
Public Relations +7 495 363 27 41

05.02.2008 11:19

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