Author: Telmuun Gankhuyag

News

ENERELT BATBOLD APPOINTED AS CEO OF TRANSBANK

Post author By Telmuun Gankhuyag
Post date February 2, 2023

TransBank has been operating in the banking and financial sector for the last 26 years and announced the appointment of Mr. Enerelt Batbold as the Chief Executive Director of the TransBank effective January 23, 2023.

CEO Enerelt Batbold has professional experience working in the banking and finance sector since 2005 and has fulfilled various management positions with the Ministry of Finance, Wealth management role at Fortis Intertrust Group of Luxembourg, Newcom group, Trafigura LLC, ABTS NBFI, Mongolian Railway state-owned shareholding company. In addition, he worked as a member of the Board of Directors of Credit Bank from October 2018 to August 2021 and was appointed as a member of the Board of Directors of the TransBank in September 2021.

During his tenure at the organizations mentioned above, he has successfully managed to raise investment of USD 58 million from the EBRD and FMO to develop and complete a pioneering US$ 120 million 50MW “Salkhit” wind farm project. Furthermore, while working as deputy head of Trafigura Mongolia he has successfully closed the acquisition of 5.02% of Golomt Bank shares under “Subscription and shareholders agreement along with US$ 35 million “Term Loan Facility agreement” for Trafigura Ptein 2012, as well as issuance of first ever of MNT 750 billion bond for Mongolia’s State-Owned Shareholding Company in 2020.

He holds a bachelor’s degree in both Finance and Management from the University of Colorado, and a Master’s degree in Banking and Finance from the Luxembourg School of Finance-University of Luxembourg from 2008 to 2009.

We are confident that the new CEO’s talent and expertise will benefit the Bank significantly.

Quarterly financial statements

As of December 31, 2022

Post author By Telmuun Gankhuyag
Post date January 26, 2023

(in millions of MNT)

BALANCE SHEET ITEMS		31/12/2021	31/12/2022
1	ASSET
1.1	Cash and cash equivalents	131,425	484,176
1.2	Due from banks and financial institutions	28,907	69,136
1.3	Financial investments	82,961	12,290
1.4	Loans and advances to customers (net)	423,569	549,812
1.4.1	Performing loans	425,169	490,950
1.4.2	Non-performing loans	11,722	77,125
1.4.3	Deferred loan payment	(126)	(140)
1.4.4	Accrued interest receivable	6,219	11,337
1.4.5	Loan Loss Provision	(19,415)	(29,460)
1.5	Derivative financial assets	36	3,416
1.6	Other financial assets	42	694
1.7	Other non-financial assets	34,630	3,369
1.8	Fixed assets (net)	11,459	22,988
1.9	Intangible assets	10,024	10,490
1.10	Total assets	723,053	1,156,371
2	LIABILITIES
2.1	Current account	58,149	120,912
2.2	Savings account	259,021	400,133
2.3	Due to banks and financial institutions	132,946	404,289
2.4	Other funds	82,048	20,560
2.5	Derivative financial liabilities	20	5,610
2.6	Other liabilities	8,165	18,409
2.7	Total liabilities	540,349	969,913
3	EQUITY
3.1	Share capital	146,474	146,474
3.2	Share premium	15,645	15,647
3.3	Treasury shares	–	(7,032)
3.4	Revaluation surplus	1	–
3.5	Retained earnings /loss/	20,446	30,255
3.6	Other reserves	138	1,114
4	Total equity	182,704	186,458
5	TOTAL LIABILITIES AND EQUITY	723,053	1,156,371

(in millions of MNT)

INCOME STATEMENT		31/12/2021	31/12/2022
1	Interest income	50,684	84,938
1.1	From Bank of Mongolia	132	415
1.2	From Other banks & financial institutions	855	2,582
1.3	From securities	4,493	4,372
1.4	From loans	44,370	72,480
1.5	Other interest income	834	5,089
2	Interest expense	24,882	45,939
2.1	Interest expense on current account	–	–
2.2	Interest expense on savings account	19,963	37,816
2.3	Interest expense on borrowed funds	1,948	2,376
2.4	Interest expense on securities	1,574	1,711
2.5	Other interest expense	1,397	4,036
3	NET INTEREST INCOME (1-2)	25,802	38,999
4	Provision expenses (provision reverse income)	599	9,225
4.1	Deposits at other banks and financial institutions	327	768
4.2	Securities	25	73
4.3	Loans	247	8,384
5	Net interest income after provision [(3)-(4)]	25,203	29,774
6	Other income	4,249	31,889
6.1	Non-interest income	4,249	31,440
6.1.1	Trading income	3,393	19,213
6.1.2	Exchange and revaluation adjustment expense	349	10,838
6.1.3	Fees and commission income	507	1,389
6.1.4	Other non-interest income	–	–
6.2	Other income	–	449
7	Other expense	15,559	48,238
7.1	Non-interest expense	15,194	47,591
7.1.1	Other provision expense	1	58
7.1.2	Trade expense	1,936	15,191
7.1.3	Exchange and revaluation adjustment expense	429	9,883
7.1.4	Fees and commission expense	462	1,108
7.1.5	Other operating expense	12,366	21,351
7.2	Other expense	365	647
8	Profit Before Tax (5+6-7)	13,893	13,425
9	Income tax expense	2,441	2,560
10	Profit After Taxes (8-9)	11,452	10,865
11	Other comprehensive income	92	(80)
12	Total comprehensive income for the year (10+11)	11,544	10,785

(in millions of MNT)

OFF BALANCE SHEET	31/12/2021	31/12/2022
Contingencies and commitments (net)	16,939	11,078

PRUDENTIAL RATIOS BY THE BANK OF MONGOLIA	Limit	31/12/2022
Tier 1 ratio	≥ 9%	26.9%
Capital adequacy ratio	≥ 12%	26.9%
Liquidity	≥ 25%	37.0%
Foreign currency open position ratio (by each currency)	< ±15%	-2.6%
Foreign currency open position ratio (total)	< ±30%	-3.2%

(in millions of MNT)

Related parties		Category of assets	Balance	% in total Equity
1	Loans and other equivalent asset provided to a related party (less than 5% of capital)			4.9%
1.1	Shareholders of the Bank	–	–	0.0%
1.2	Key management personnel	–	–	0.0%
1.3	Other related parties	Loan	9,140	4.9%
2	Total Loans and other equivalent asset provided to related parties (less than 20% of capital)			18.5%
2.1	Shareholders of the Bank	Loan	100	0.1%
2.2	Key management personnel	Loan	331	0.2%
2.3	Other related parties	Loan	34,020	18.2%

Compliance

Anti-money laundering and countering the financing of terrorism policy:

Transport and Development Bank has implemented compliance principles into our business operation in accordance with the Law on Anti-money laundering and countering the financing of terrorism (AML/CFT Law), as well as regulations, recommendations and standards issued by international and domestic regulatory bodies.

The Bank has developed an AML/CFT program covering Know Your Customer (KYC) Procedure, Customer/Product ML/TF Risk assessment, Implementation of international sanctions and Correspondent bank and financial institution’s relationship in accordance with applicable laws and regulations.

In accordance with the AML/CFT Law and Regulations, the Bank shall undertake appropriate KYC measures to fully ensure and verify customer’s data, payment slip, agreements, invoices and any other documents prior to providing any banking services.

The information indicated below shall be authenticated by an official source and documents. These include:

The purpose of business relationship with the bank;
Beneficial owner and shareholder structure, asset management information;
Customers’ nature of business and operations are in line with the purpose of the transaction;

Prior to establishing any financial and business relationship with foreign banks, the Bank shall comply with the requirements of the Correspondent Banking Due Diligence Questionnaire (CBDDQ) and recommendations on correspondent banking relationships issued by Wolfsberg Group, US Patriot Act and FATCA Regulation.

Wolfsberg CBDDQ:

Please click on here to access Correspondent Banking Due Diligence Questionnaire (CBDDQ) for FIs defined by the “Wolfsberg Group”.

US Patriot Act:

Please click on here to access Global USA Patriot Act certification issued by the U.S. Department of the Treasury.

FATCA:

Transport and Development Bank, akin to every financial institution in the world is obligated to report foreign financial assets and accounts held by US Person and legal entities to the US Internal Revenue Service (IRS) under the Foreign Account Tax Compliance Act (FATCA).

Please click on here to access FATCA W-8BEN-E form completed by the Transport and Development Bank.

TransBank is committed to ensuring that it has adequate controls to counter money laundering and terrorist financing activities, in line with all applicable laws, rules and regulations mandated by the governments of Mongolia as well as other relevant international standards and/or recommendations.

Translation of legal and regulatory obligations into procedures

We have established policy and procedures designated to combat Money laundering and Terrorism Financing in line Mongolian AML law, FATF standards and other regulatory’ s respective rules and regulations. The AML/KYC policy is included policy of identifying and verifying the identity of the customers and of the beneficial owners on the basis of documents, data or information obtained from a reliable and independent source. We do not allow anonymous accounts.

Moreover, we pay special attention to:

Understand the ownership and control structure of our customers;
Obtain information on the purpose and intended nature of business relationship; and
Monitor the business relationships, including scrutiny of transactions to ensure consistency of transactions with obtained information about and intended nature of business relationship.

All legal and regulatory documents related to the Mongolian law and other international AML/CTF framework have been translated into internal written procedures and they are regularly reviewed and updated. These mandatory policies and procedures are compliant to the FATF and other AML standards.

The AML/CTF policies and procedures have been approved by the BoD.

Acceptance of new customer and new business relations

For all new accounts opening requests, branch front-office staffs are required to fill out a detailed questionnaire asking for precise information about prospective customers, their type of business, the origin of their wealth and the type of operations they to conduct with the bank, etc.

Prospective customers are screened in an ongoing process through official lists in order to avoid to enter into relationship with individuals or institutions which appear on applicable lists of terrorists or terrorist organizations, or against whom sanctions have been imposed by the UN or US OFAC list, EU or with someone being or having been involved in criminal activities.

We have procedures in place for the identification and the monitoring of politically exposed persons (PEPs). Enhanced due diligence is conducted on these customers. In accordance with a risk based approach, account opening requested by prospects considered as requiring an enhanced due diligence (such as PEP, clients’ resident in high risk country from AML/CTF perspective, clients having a high risk professional activity, etc) have to be formally approved by the Senior management with a Compliance recommendation. The Bank does not enter knowingly into any business relation with a “shell bank/shell company”.

Any new business relation with a potential banking correspondent in a country with non-equivalent international and domestic AML/CTF measures has to be approved at Compliance level on the basis of a duly motivated request and a thorough analysis of the identity, the reputation and the AML process of that particular correspondent (for instance via the Wolfsberg questionnaire). We do not allow direct use of correspondent accounts by third parties (payable through account).

Monitoring transactions

We use dedicated AML tools to be detect suspicious transactions and to filter incoming and outgoing payments. The detection of suspicious transactions will trigger an in-depth investigation of the customer account by Compliance department who analyses deeply the situation. The bank filters transfer messages and screens its clients database against official lists and internal lists.

Employee AML/CTF training

A mandatory Compliance awareness and training program has been implemented in order to provide training and information to relevant employees taking into account the level of risk exposures of their function and to comply with the standing legal requirements. These trainings include introductory training for new employees as well as ongoing training for existing employees, either face-to-face or through other means. In case of legal or regulatory changes, supplementary training and information are provided.

Responsibility of branches, departments

Transbank has instructed all branches and departments to respect the Bank standards regarding AML/CTF and KYC. General AML/CTF policies and procedures are available to the employees on our internal intranet site. Starting 2022 Transbank’s branches have appointed internal Compliance staffs, each Compliance staff responsible for implementing AML/CTF policies and procedures within the branch, train and advice branch staff in order to opening a new account, conducting wire transfer, performing customer DD etc.

Our Internal Audit Department is auditing Compliance activity on a regular basis and compliance procedures and practices from AML/CTF perspective. In parallel, Compliance is also performing controls and risk assessments of the operational procedures and their practical application, new product and services.

Please find here under the information concerning the responsible AML Officers:

Delgersaihan Amarjargal
Head of Compliance unit
Tel: 976-7716999 (ext 114)
Email: delgersaikhan.a@transbank.mn

Turgerel Tumurkhuyag
Senior AML officer
Tel: 976-7716999 (ext 106)
Email: turgerel.t@transbank.mn

News

TRANSPORT AND DEVELOPMENT BANK PRESENTS ITS FINANCIALS FOR SECOND QUARTER OF 2022

Post author By Telmuun Gankhuyag
Post date July 26, 2022
No Comments on TRANSPORT AND DEVELOPMENT BANK PRESENTS ITS FINANCIALS FOR SECOND QUARTER OF 2022

As of second quarter of 2022, the total asset of the Bank reached MNT 837.2 billion, an increase of 102% compared to the same period in 2021, while the net profit reached MNT 9.8 billion, increasing by 145% compared to the same period of the previous year.

During the reporting period, the Bank fully complied with the prudential ratios set by the Bank of Mongolia and implemented a new risk based approach into its operations. As of first half of the 2021, the NPL ratio of the Bank stood at 3.1%, which is significantly lower than the banking sector average.

Furthermore, in order to expand the scope of our operations and to bring our services closer to our customers, the Bank has opened 3 new branches (Premium, Cedar and Munkh Tower), bringing the total number of branches to 11. We would also like to highlight introduction of the WeChat Pay international payment system by the Bank, which enables our customers access to 64 countries and range of new opportunities.

As of June 30, 2022, in accordance with Article 4, Clause 4.2 of the Banking Law and Article 4 of the Procedures on Complying with the Amendment to the Banking Law, we are pleased to announce that Transport and Development Bank has been restructured as Closed Joint Stock Company.

Click here to view the financial report for the second quarter of 2022.

Quarterly financial statements

Year-2022 Quarter- 2

(in millions of MNT)

BALANCE SHEET ITEMS		31/12/2021	30/06/2022
1	ASSET
1.1	Cash and cash equivalents	131,425	162,346
1.2	Due from banks and financial institutions	28,907	56,337
1.3	Financial investments	82,961	41,330
1.4	Loans and advances to customers (net)	423,569	494,759
1.4.1	Performing loans	416,828	491,699
1.4.2	Non-performing loans	11,722	15,638
1.4.3	Deferred loan payment	(126)	(147)
1.4.4	Accrued interest receivable	6,219	9,983
1.4.5	Loan Loss Provision	(19,415)	(22,414)
1.5	Derivative financial assets	36	1,318
1.6	Other financial assets	42	144
1.7	Other non-financial assets	34,630	58,518
1.8	Fixed assets (net)	11,459	12,585
1.9	Intangible assets	10,024	9,913
1.10	Total assets	723,053	837,249
2	LIABILITIES
2.1	Current account	58,149	111,974
2.2	Savings account	259,021	304,096
2.3	Due to banks and financial institutions	132,946	177,022
2.4	Other deposits	82,048	47,042
2.5	Derivative financial liabilities	20	2,255
2.6	Other liabilities	8,165	9,362
2.7	Total liabilities	540,349	651,751
3	EQUITY
3.1	Share capital	146,474	146,474
3.2	Share premium	15,645	15,645
3.3	Treasury shares	–	(7,032)
3.4	Revaluation surplus	1	1
3.5	Retained earnings /loss/	20,446	30,272
3.6	Other reserves	138	138
4	Total equity	182,704	185,498
5	TOTAL LIABILITIES AND EQUITY	723,053	837,249

(in millions of MNT)

INCOME STATEMENT		31/12/2021	30/06/2022
1	Interest income	50,684	40,320
1.1	From Bank of Mongolia	132	60
1.2	From Other banks & financial institutions	855	1,039
1.3	From securities	4,493	2,753
1.4	From loans	44,370	34,933
1.5	Other interest income	834	1,535
2	Interest expense	24,882	19,420
2.1	Interest expense on current account	–	–
2.2	Interest expense on savings account	19,963	15,863
2.3	Interest expense on borrowed funds	1,948	1,302
2.4	Interest expense on securities	1,574	1,104
2.5	Other interest expense	1,397	1,151
3	NET INTEREST INCOME (1-2)	25,802	20,900
4	Provision expenses (provision reverse income)	599	2,216
4.1	Deposits at other banks and financial institutions	327	–
4.2	Securities	25	–
4.3	Loans	247	2,216
5	Net interest income after provision [(3)-(4)]	25,203	18,684
6	Other income	4,249	13,250
6.1	Non-interest income	4,249	13,101
6.1.1	Trading income	3,393	8,236
6.1.2	Exchange and revaluation adjustment expense	349	4,273
6.1.3	Fees and commission income	507	588
6.1.4	Other non-interest income	–	4
6.2	Other income	–	149
7	Other expense	15,559	20,127
7.1	Non-interest expense	15,194	19,856
7.1.1	Other provision expense	1	–
7.1.2	Trade expense	1,936	5,315
7.1.3	Exchange and revaluation adjustment expense	429	4,290
7.1.4	Fees and commission expense	462	596
7.1.5	Other operating expense	12,366	9,655
7.2	Other expense	365	271
8	Profit Before Tax (5+6-7)	13,893	11,807
9	Income tax expense	2,441	1,981
10	Profit After Taxes (8-9)	11,452	9,826
11	Other comprehensive income	92	–
12	Total comprehensive income for the year (10+11)	11,544	9,826

(in millions of MNT)

OFF BALANCE SHEET	31/12/2021	30/06/2022
Contingencies and commitments (net)	16,939	20,462

PRUDENTIAL RATIOS BY THE BANK OF MONGOLIA	Limit	30/06/2022
Tier 1 ratio	≥ 9%	29.4%
Capital adequacy ratio	≥ 12%	29.4%
Liquidity	≥ 25%	31.1%
Foreign currency open position ratio (by each currency)	< ±15%	-5.3%
Foreign currency open position ratio (total)	< ±30%	-9.2%

(in millions of MNT)

Related parties		Category of assets	Balance	% in total Equity
1	Loans and other equivalent asset provided to a related party (less than 5% of capital)			4.5%
1.1	Shareholders of the Bank	–	–	0.0%
1.2	Key management personnel	–	–	0.0%
1.3	Other related parties	Loan	8,289	4.5%
2	Total Loans and other equivalent asset provided to related parties (less than 20% of capital)			18.3%
2.1	Shareholders of the Bank	Loan	100	0.1%
2.2	Key management personnel	Loan	279	0.2%
2.3	Other related parties	Loan	33,615	18.1%

List of licensed agents

Branch name	Name	License date	Location
Head office	GARAVSUREN.N	2023	Shangri-La Office, 19A Olimpic St, 1st khoroo, Sukhbaatar district, Ulaanbaatar, Mongolia
Ard Branch	MICHIDMAA.B	2023	1st floor, Building B8, Baga Toiruu St-9, 1st Khoroo, Chingeltei District, Ulaanbaatar, Mongolia
Naran Branch	ENKHBAT.G	2020	1ST, 2ND floor, Naran Mall Department Store, Seoul St-35, 3rd Khoroo, Sukhbaatar District, Ulaanbaatar, Mongolia
Munkh tower branch	ARIUNTUGS.E	2023	1st floor, Munkh Tower, Chinggis Avenue Street, 1st Khoroo, Khan-Uul District, Ulaanbaatar, Mongolia
Munkh tower branch	MUNKHZUL.G	2023
Central Tower Branch	BOLORMAA.Z	2020	4th floor, Central Tower, Sukhbaatar square-2 , 8th Khoroo, Sukhbaatar District, Ulaanbaatar, Mongolia
Central Tower Branch	USUKHBAYAR.B	2023
Cedar Branch	TUNGALAG.A	2022	1st floor, Cedar City Residence Town, 4th Khoroo, Khan-Uul District, Ulaanbaatar, Mongolia
Sakura Branch	BAYARMAA.G	2022	1st floor, Sakura Building Center, Ikh Mongol St, 26th Khoroo, Bayanzurkh District, Ulaanbaatar, Mongolia
Shangri-la Branch	BILGUUN.N	2022	6th floor, Shangri-La Office, 19A Olympic St, 1st Khoroo, Sukhbaatar District, Ulaanbaatar, Mongolia
Shangri-la Branch	DAGIIMAA.O	2022
Zuun durvun zam branch	KHUSLEN.B	2023	1^st floor of Naran Shopping Mall’s 2^nd Building, 15^thKhoroo, Bayanzurkh District, Ulaanbaatar, Mongolia
Premium branch	BAYARMAA.G	2023	2nd floor, Premium Palace, Ikh Toiruu St, 5th Khoroo, Chingeltei District, Ulaanbaatar, Mongolia
River garden branch	ENKHNARAN.B	2022	1st floor, Building 308, River Garden Town, Ikh Mongol St, 11th Khoroo, Khan-Uul District, Ulaanbaatar, Mongolia

Exclusive Trip

Exclusive Trip offers you great opportunities of being protected financially, while traveling in Mongolia. We never know what happens in the future if there is some bad luck of getting into an accident, food poisoning or any chronic conditions raise ups, that can interrupt your whole journey with a life threatening scenes. In such cases, we should always be protective to take the action to reduce further losses. The Exclusive Trip is a right insurance, that you can be protected financially and enjoy your journey with a peace of mind. If there is an emergency during the trip, Exclusive Trip will pay you for the air ambulance to Ulaanbaatar and hospitalization treatments.

Please e-mail us for more information reaching our experts or contact:

E-mail: daatgal@transbank.mn
Tel: +976 7716-9999

Credit Med

The most favorable way to protect your health and save money for medical expenses is to have a Credit Med insurance policy.

Exclusive Home

Insurance is the smartest way to save money. The “Exclusive Home” is the best, true cover for protecting your home financially

Exclusive Auto

This is true insurance that offers you Exclusive cover because your car is exclusive.

Exclusive Home

Benefits

If your home has burnt down, been ruined in the water damage, or been damaged with any kinds of natural disasters, the Exclusive Home will pay for the repair expenses in calculated Rebuilding cost.
The pools, yard, trees, and bushes are covered and Exclusive Home will pay for rebuilding and regrowing.
The arts, antique statues are covered, if you want the additional cover for precious your collections.
Exclusive Home will provide you with experts having free risk survey once a policy year.

Credit Med

Benefits

Credit Med will pay you for the expenses of visiting doctors, having medical check-ups, analyses, and treatments.
If you have a saving account with TransBank, you will be provided with an exclusive credit card for medical expenses.
Credit Med will provide the guarantee to the hospitals using direct billing payment methods to the local hospitals of Mongolia.
You are given the option of choosing annual health screening limits up to 100,000.-500,000.tugrics as your Policy benefits.
Your vaccination expenses are covered under Credit Med.
In case of the life-threatening diseases such as cancer, organ transplantation, Credit Med policy will pay the expenses up to 40 million tugriks.
If you are diagnosed with cancer, Credit Med will pay 10 million tugriks of cash directly to your account as cancer cash benefit to support you both emotionally and financially and you do not need to collect the medical payment receipts to get cancer cash benefit.
Please note that COVID-19 treatment, PCR analyses or quarantine expenses are not covered under Credit Med.

Exclusive Auto

Benefits

No need of bringing the police report at a road accident, if there is no bodily injury.
We promise, there will not be any disappointment in decreasing your insurance payment for recovering your loss, instead the Exclusive Auto will pay the full repair cost at the distributor’ body shop.
The Exclusive Auto will provide you with a car during the repair period of your car at the shop.
There will not be required loss adjuster’s report if there is no bodily injury and no third party involvement.
If you have trouble while driving in the countryside, the towing cost to Ulaanbaatar will be paid from your Exclusive Auto insurance.

TERMS AND CONDITIONS
Tenor		MNT
Term		12 months
Annual interest rate		The bank’s 12 months regular term deposit interest rate
Total annual interest rate		Annual interest rate + Exchange rate risk sharing interest rate*
Minimum deposit		500,000,000 MNT
Interest rate upon early termination of contract		2.4%-4.8%
Interest capitalization		Quarterly
Withdrawals		Quarterly
Conditions for earning income		Possible
TERMS OF EXCHANGE RATE RISK SHARING INTEREST RATE
№	USD exchange rate of the Bank of Mongolia** /MNT/	Exchange rate risk sharing interest rate* /annual/
1	3,000 ≤ ** < 3,100	0.5%
2	3,100 ≤ ** < 3,200	1.0%
3	3,200 ≤ ** < 3,300	1.5%
4	3,300 ≤ ** < 3,400	2.0%
5	3,400 ≤ ** < 3,500	2.5%
6	3,500≤ **	3.0%
Note : *The interest rate on this deposit will change in accordance with the policy rate of the Bank of Mongolia and the rise and fall of the exchange rate.