Banks Seek Licences in London

It was practically inevitable: the well-heeled young turks of Russia's banking world, on the quest for (in search of) the elusive prize of a prestigious British licence, are setting up shop in London.

Six of Russia's leading financial institutions now have London representative offices, which although prohibited from conducting commercial operations offer a high-profile avenue for (possibility) courting government regulators¹ and potential clients.

"London is the oldest and best-known financial center in the world," said representative of Alfa-Bank, which opened premises in the City Tower in the heart of London's banking district earlier this year. "If you have Bank of England recognition, you are recognized by everyone."

The Russian banks, however, face a difficult task in winning a foreign operating licence. They have to show that they have not come to launder money, and they have to reconcile their Russian accounting practices with (зд. привести всоответствие) the Western accounting system.

"The principal concern of the Bank of England must be criminality," said a source at a U.S. bank with interests in London and Moscow, who asked not to be named. "Ownership of Russia's banks is very opaque. You cannot tell if the shareholders include mafia elements."

Alla Haines, a specialist on Russian banks with the respected IBCA rating agency, said: "There are a lot of suspicions regarding Russian banks. People don't know much about them here. The main problem is one of attitude (position)."

The Bank of England itself refuses to comment on specific problems with granting licences to Russian banks, but the requirements it spells out are strict.

The chief technical obstacle is the Risk-Asset Ratio, or RAR, of Russian banks, which measures an institution's capital base against its risk-weighted outstanding loans. A bank cannot obtain or retain a licence if this ratio falls below a certain level, set at a minimum of 8 per cent in the international Basle Accord on banking norms.

Many Russian banks currently meet the 8 per cent threshold, according to the IBCA. But the Bank of England fears sudden upsets. "The situation would need constant monitoring, since high Russian inflation tends to make a bank's lending grow faster than its retained earnings," said another IBCA specialist.

Another obstacle is the state of the bank's internal accounts. "We have only two years of Western auditing, and a minimum three years is required before the Bank of England will consider granting a licence," an Alfa-Bank official said. "The Bank of England has told us to establish a relationship with it before submitting any application."

Fear that Russian economic instability could spread to the West through licenced Russian banks is another factor. Haines said the recent interbank market crisis in Russia when liquidity dried up and loans between banks grounded to a near halt, "slowed down the licencing process."

Western bank supervision agencies will feel more comfortable about licencing once the Russian authorities have set up supervisory norms corresponding to those in the West.

TheRussians seem to be sparing little expense in making their presence felt. Although use ofthe offices is limited to information gathering and meetings, they also have a showcase value: Alfa's City Tower premises are down the corridor from the Bank of England itself. Promstroibank is in Mayfair.

Many of banks establishing themselves in London already have set up in Germany, currently home to a dozen representative offices. But the banking authorities there, too, have made it clear that they are not yet ready to consider licence applications from the arrivals.

Комментарии representative office – представительство;

young turks – «младотурки» – радикальное движение в Турции начала XX века; пер. – молодые энергичные деятели, стремящиеся порвать с прошлым;

to set up (shop) – зд. обосновать;

courting = wooing, зд. налаживать контакты;

opaque = vague;

capital base – основной капитал;

outstanding loans – невозвращенные кредиты;

Basle Accord on banking norms – Базельское соглашение о банковских нормативах;

threshold = level criterion;

upsets = problems, snags;

internal accounts – внутренняя отчетность;

liquidity - наличность;

grounded to a near halt = practically stopped, discontinued;

showcase value – зд. prestige (cp. offer high – profile avenue);

to spare little expense = to stop at nothing.

Тема: Налоги (см. Taxation Terms Mini Chart, стр.113).

Подоходный налог становится одним из самых рентабельных

Законом о подоходном налоге предусмотрено, что граждане, занимающиеся предпринимательской либо другой деятельностью, не связанной трудовыми отношениями, подлежат обложению налогом на основании подаваемых ими в налоговые органы деклараций. Также декларацию подают те, кто имел в течение календарного года доходы от двух и более источников в размерах, превышающих суммы дохода, облагаемого по минимальной ставке налога. На сегодняшний день 60% населения имеют источники разного характера, налоговыми органами проверке подвергаются лишь 20–25%.

Увеличить поступления от подоходного налога могут последние изменения в налоговом законодательстве. Уже затронуты четыре льготы из существовавших до недавнего времени шестидесяти.

Подоходный налог с физических лиц является федеральным налогом, поступающим в местный бюджет. Он обязателен к уплате. Рентабельность налога – каждый затраченный рубль на сбор приносит 9 рублей дохода. (См. также раздел «Интервью».)

Комментарии подоходный налог – income tax;

налоговые органы – taxation agencies. Federal Tax Service in

RF; Internal Revenue Service (IRS) in US;

льготы – зд. types of tax exemptions;

физическое лицо – physical person (ant. legal entity);

рентабельность налога – зд. tax spin-off, profitability;

сбор (налогов) – tax collection.

Тема: Construction and Real Estate

Industry Emerges from Stagnation

The Russian construction market has endured its share of ups and downs. Huge profit margins at the start of the decade were swiftly followed by a dramatic¹ slump between 1994 – 96 before a belated recovery began to take hold (effect), followed by yet another and even bigger crash in 1998.

Attractive Real Estate Market

In the early 1990s the attractions of the Russian market for foreign construction companies were obvious. The competition was relatively negligible and the rewards for entertaining the risks inherent in working in the Russian capital were huge.

"Profit margins at the start of the decade were three times what they are now," said Pietro Giello of Codest, which has been operating throughout Russia since 1984 and has been involved in some of the capital's most prestigious projects including the Ducat buildings.

"Margins were huge and it's only recently that they have come down towards a more realistic level," agreed Konstantin Gusakov of the Stolny Grad, formed originally to manage thedevelopment of flagship project, like the Penta Hotel in the mid 1980s.

Standards of construction (quality) also sometimes left a lot to be desired. "The competition was so scarce (small) that international companies were sometimes paying pre-lease (advance) payments for 4-5 years for accommodation that was not of the best quality simply because they had no other option," said Gusakov.

"Originally, you could build anything and put it on the market at that time," confirmed Calvac O'Carrol of Murray O'Laire, one of Moscow's longest serving architectural firms having first entered the market in 1991.

Domino Crisis

There was, however, soon to be a flip side to the coin of potential riches in Russia. A dramatic slump in confidence in the banking sector in 1994 and then in 1998 severely curtailed development finance as banks, previously tripping over themselves in their anxiety to explore the lucrative real estate sector, reigned in the money, causing many projects to stall (slow down).

Not surprisingly, one of the hardest hit by this was the construction industry as silence descended on construction sites throughout Moscow. The fallout was considerable. One victim that was still awaiting completion is the massive Zenith development at Yugozapadnaya, another the Meyerhold project at Novoslobodskaya. Even Smotensky Passage, which promised to be one of Moscow's most exciting developments in 1998, stood still for a number of years asfinance dried up.

"A lot of banks were very badly burned during this period and payments, particularly to Russian firms, were often 6-12 months late if they arrived at all," said Gusakov.

"Other firms employed by the Moscow City Government sometimes had to settle for (agree) payment in non-monetary terms such as apartment blocks as the authorities simply didn't have the necessary funds to pay in dollars."

A lot of contractors were forced out of business and, in a market that is as interdependent as real estate, the knock-oneffects threatened to be dramatic.

" Pulling out of the market did become an option for us although we had made such an investment already in Moscow that we never seriously entertained it," said O'Carrol. "We actually never stopped working during this period although it was touch and go at some points but we were sure Moscow would come right eventually," added his colleague, Pascal Mahoney.

Recent Boom

Come right, it seems to have done with a vengeance in the last 12 months. The malaise that had affected the industry since 1998 and which was exacerbated by the political uncertainties surrounding the destination of the Presidency began to lift almost as soon as Putin's victory was assured. "The change in market has been dramatic in the last six months or so," said Mahoney while Gusakov commented, "Moscow is now in the midst of a serious construction boom."

That the market has recovered is perhaps most evidenced by the renewal of foreign interest in Moscow and re-entry of banks as investors, most notably witnessed by Moscow Sberbank's USD 50m loan to Smolensky Passage.

Lesson to Be Learned

Perhaps more interesting, however, is to take a look at exactly what type of market has emerged from the peaks and troughs (ups and downs) of the last six years. One thing that most experts appear to be agreed upon is that the construction industry is now considerably more professional. Undoubtedly, this has been in part engendered by a strengthening in competition. "Probably the most notable feature of the last 12-18 months is that Russian companies have successfully learned many of the practices that gave western companies a competitive edge a few years ago. Although this edge is still in evidence at the very top end of the market, the professionalization of local companies is and will be of increasing importance over the next few years," said Giello.

Комментарии profit margins = net profits;

to slump = to fall drop;

negligible = non-existent;

flagship = prominent, major (флагман);

to entertain = to consider;

flip side = the other side;

curtail development finance = cut financing of projects;

to trip over oneself = to try very hard (go out of one's way);

to reign in = to keep to oneself (попридержать);

fall-out = consequences (cp. knock-on effects);

to dry up = to discontinue, stop;

contractors – подрядчики;

to pull out = to leave;

touch and go = very risky;

with a vengeance = triumphantly; ср. «взять реванш»;

malaise = disease;

to exacerbate = to worsen;

to engender = зд. to cause;

competitive edge = advantage over competitors.

Сити ждет инвестора

Москва разорвала контракт с канадской фирмой Reichmann Asia Co. Ltd, которая ранее обязалась построить деловой и жилищный комплекс в районе Краснопресненской набережной – московский Сити стоимостью $135 млн. «Альберт Рейхманн и возглавляемая им фирма оказались несостоятельными по отношению к выполнению взятых на себя обязательств (commitments) в российской столице», – заявил ИТАР-ТАСС первый зампремьера правительства Москвы, отметив, что, согласно контракту, в нынешнем году истек (expired) срок, до которого правительство Москвы не имело права заключать соглашение с другими компаниями на застройку в этом районе.

Под контракт канадская корпорация 20 месяцев назад получила территорию практически в центре Москвы в аренду на 49 лет. Договор предусматривал, что к концу нынешнего года здесь должно быть сооружено 30 различных зданий, в том числе два высотных корпуса, торговый центр и многое другое. Администрация Москвы выполнила свою часть контракта, вложив в освоение этого участка $40 млн. Однако он до сих пор пустует, поскольку компания г-на Рейхманна не инвестировала «ни копейки, ни доллара», сказал представитель московского правительства.

Говоря о строительстве на Краснопресненской набережной, он сообщил, что уже открылся уникальный в Москве и России двухъярусный пешеходный мост, соединяющий будущий деловой центр «Москва-Сити» и набережную Шевченко. В скором времени строители приступят к возведению делового и офисного центра в Сити – Дома России, высота которого достигнет 400 м. Это сооружение обещает стать самым высоким в Москве, так как даже высота знаменитых «сталинских» высоток не превышает 150 м.

Комментарии обязалась – undertook;

оказался несостоятельным – proved unable to (ср. несостоятельный – insolvent; bankrupt);

двухъярусный – two-tier;

«высотки» – high-rises (Stalin's sky-scrapers).

Тема: Протокол и стиль одежды (для перевода «под запись»)

The Policies of Dressing

I know you are just starting reading this, but stop! Look down. What are you wearing right now? Whether you are at home, scouring the want ads or at the office leisurely reading this issue, take a moment to look at how you are dressed and the image you are projecting. Did you sleep an extra Fifteen minutes this morning and then skimped on the dressing extras, like polishing your shoes or completely pressing your shirt?

Like it or not, the world judges you by what you wear, at least on a first impression basis. Clothes to some degree define you. "People still underestimate the value of business dress," says Laurie Sagle of the employee training company, Training Works! "As the [Russian] market continues to change, clothes become more important, giving you an edge" (advantage).

After having worked in the Russian market for over six years, she says many people don't realize the importance of business dress, especially women. "What is most appropriate (acceptable) generally tends to be pretty dull. There is a big confusion between fashion and business dress." Sagle attributes this to the changing clothing market in Russia, where fashion options (selection, choice) have multiplied in recent years. She simply asks her clients: "What do you want 10 emphasize, your body or your brain? It may be a little blunt," she says, "but people need to understand the difference in social and business dress."

Another misconception is thinking you need to spend a lot of money to improve your business image. The most important thing is simple grooming. "Make sure you are clean from your shoes to the top of your head," emphasizes Sagle.

Dress Code

What is necessary or appropriate often depends on the line of work. The more conservative business sectors, such as banking, and law require grey, navy or black suits for both women and men. But whatever the sector, there are basic rules for office dressing. Keep it professional and clean. Leave the fashion pieces for social occasions, unless you work in the fashion field.

Business dressing only begins with the first interview. Because you want to be hired for a position, you present yourself in the best possible way, from resume to interview attire. But what you wear and how you wear it, after you have landed the job, can mean promotion or even dismissal, especially in the conservative areas of employment. A colleague of mine, who worked for an extremely prestigious and fashionable magazine in New York, told me about her office's unwritten rule of dress: whatever you wear, make sure that it's black. Everyone dresses in black, from the designers to the receptionists. The company even went so faras to require black desk accessories (канцпринадлежности), meaning the office manager would throw out your red stapler if it wasn't hidden in your desk drawer. The unwritten rule also affected internalpromotions. People didn't get promoted if they did not "fit in," which included dressing in what is considered a fashionable and appropriate way. Although this case may seem a little extreme, it illustrates the fact that often, how you dress for work can impact how far you go in your job.

Unproperly Dressed

Another colleague, a department supervisor at a major international computer firm in Moscow, worked with a talented computer consultant at his firm. Although the consultant was highly skilled, he lacked what is considered a proper business suit. Unfortunately, it impacted (affected) his promotion opportunities. Because he didn't quite look the part, unintentionally or not, he was not asked to join business meetings with clients. Companies can be very particular about the image they want to project, and as an employee of that company, they will be particular about the role of image you project as their representative. My colleague wanted to tell the man to invest in a decent suit for client meetings. Yet discussing such a subject can be difficult- A little self-evaluation can go a long way (help).

The rule that image consultants offer is to dress for the position you want, no matter what level you may be with a company. If you are a receptionist, but strive (want) to move into the marketing department, then look at how the marketing director presents himself or herself. If those are the shoes you want to fill, then put yourself in the position where you can be considered for the part. Although skills are extremely important, part of the battle for a promotion is presenting yourself as capable of doing the job. Dressing appropriately demonstrates that you have enough wherewithal to know how to present yourself to clients and other employees. It also creates a sense of self-confidence and pride necessary to lead a team of employees or impress outside contact. Does the marketing director ever come to work in jeans or other casual wear, or is it suit and tie every day?

Bright Is Out

I remember working in a law firm in Washington, DC, where the decor was traditional American antiques and the unwritten rule of the firm was dress well – and conservatively. Black, grey and navy Brooks Brothers^[10] suits abounded in a place where Hugo Boss^[11] would be considered living dangerously. A secretary was hired for one attorney, and though she may have been extremely competent, she was also very festive. Every holiday, she would come to work dressed to thenines in the garb of the season – Halloween meant an orange shirt, white nylon pantyhose with orange pumpkins and some sort of spider earrings to match! I'm not sure how many holidays she made it through, but unfortunately, it wasn't many. Ithink it was sometime soon after the orange bat shirt that she was cleaning out her desk. Perhaps it wasn't specifically her holiday wear that lead to her dismissal, but I can't help but think that it contributed. Quirks can be tolerated, although they usually only come from superiors. I know art directors and partners in international law firms who tend to walk around the office in their sock feet (без обуви), leaving the shoes somewhere under the desk. Yet these types of people generally have proven themselves with a firm to the degree that such things become " endearing " (charming) – a part of the process in producing their quality work.

In the Western world, where fashion traditions have been built over the generations, there are stricter codes of proper business attire. In Russia, the rules are less strict. Company handbooks don't usually specify the ties that are acceptable or the appropriate length of your hair. Many businesses allow employees to wear jeans in places that would be unheard of in the States – and people seem more sympathetic to the weather. I was delighted during my first summer in Moscow to enjoy the freedom of working for an international publishing firm, without having to wear the dreaded (ненавистные) nylons with my summer suits.

Ashleigh Morris

Комментарии scouring the want ads = looking through jobs pages;

skimped on the dressing extras – зд. пренебрегли деталями;

edge = advantage;

blunt = straightforward;

social – светский; зд. вечерний, нарядный;

grooming – уход за собой;

attire = garb = clothes;

dressed to the nines – зд. разодетая в пух и прах;

pumpkins – тыквы;

quirks – выходки, причуды.

Задание

What does it mean for you to be fashionably dressed today?

Do you like today's fashions?

Do you think people should dress differently at home and in the office? What should be the difference between casual wear and business style?

Do you agree with the opinions, expressed in the article?

Did you find useful the article on protocol in Part I?

Тема: Social Life (передача юмора и иронии)