The following companies are part of AS Eesti Krediidipank group: AS Eesti Krediidipank (bank, parent company), subsidiaries Krediidipanga Liisingu AS (leasing), AS Krediidipank Finants (private loans) and AS Martinoza (real estate). The organisational structure of AS Eesti Krediidipank group was rebuilt in 2015 with the aim to strengthen all sales units of the company and provide effective support back office for them.
Management of AS Eesti Krediidipank Group
AS Eesti Krediidipank Group is guided in its activities, including in Group management, from the principle of consolidation, which is reflected in the setting of common and coordinated objectives, compliance with common basic values and creation of bodies with decision-making and/or advisory powers for the purpose of managing risks pertaining to the operation on the level of the Group.
The management bodies of the companies in the Group are the Supervisory Board and the Management Board of the company concerned. The strategy, objectives and risk management principles of the Group are approved by the Supervisory Board of the Bank. The Management Board of the Bank and the Supervisory Boards of the companies in the Group approve more detailed action plans for the companies concerned, taking account of the strategy and objectives of the Bank's Group as well as its willingness to take risks as approved by the Supervisory Board of the Bank. The basic values expressed in the strategy of the Group are common for all the companies in the Bank's Group.
For more efficient management of the Group and for assisting the management bodies, various committees have been set up on the level of the Group as follows:
- Audit Committee, which consists of the members of the Supervisory Board of the Bank and the purpose of which is to be an advisory body in the areas of accounting, audit, risk management, lawfulness of operation, internal control and internal audit, supervision and budgeting.
- Remuneration Committee, which consists of the members of the Supervisory Board of the Bank and the purpose of which is to evaluate the implementation of the remuneration principles and their conformity to the operating targets of the Group as well as to evaluate the impact of the decisions related to remuneration on the compliance with the requirements set for risk management, own funds and liquidity of the Group.
- Credit Committee and Credit Commission, which are bodies with decision-making powers upon making credit decisions and the purpose of which is to ensure by their decisions compliance with the common credit policy on the level of the Group.
- Price Commission, which is a body with decision-making powers upon management of real estate risk and management of collaterals for realised credit risk on the level of the Group.
- Assets and Liabilities Management Committee, which is a body with decision-making powers on the level of the Group for managing liquidity risk, bank portfolio interest rate risk and securities portfolio, for structuring assets and liabilities, managing profitability and planning capital.
In order to ensure the efficiency of operation of the Group, reliability of financial reporting, compliance of the operation with laws, other legislation and internal rules approved by the management bodies and making of decisions on the basis of reliable and appropriate information, an internal control system on the level of the Group, which covers all the levels of operation and management, has been set up in the Group. Control of operations is based on a 3-level control system. On the first level, control is exercised within each unit internally as self-control. On the second level, risk management and compliance functions act as independent and autonomous control units. The internal audit unit, which controls the entire operation of the Group, acts on the third level.
Management Bodies of AS Eesti Krediidipank
The management bodies of AS Eesti Krediidipank are the Supervisory Board and the Management Board.
The Supervisory Board is elected by the General Meeting for a term of five years. Proposals for nomination as a member of the Supervisory Board in the form of a draft resolution of the General Meeting can be made by the shareholders, whose votes represent at least 1/10 of the share capital.
The Management Board is elected as a collegial body by the Supervisory Board of the Bank also for a term of five years. Upon electing members of the Management Board as a collegial body the Supervisory Board observes that the formed Management Board would be adequately diverse in its composition in term of its members' expertise, skills, experience and education in order to ensure the ability of the Management Board to efficiently manage all the areas of activity of the Bank. When forming the composition of the Management Board, account is also taken of gender diversity and, if possible, formation of a Management Board which consists of members of a single gender is avoided.
Election of members of management bodies is based on the requirements for members of management bodies established by the Credit Institutions Act: the elected person must have the expertise, skills, experience, education and professional qualifications necessary for managing a credit institution and an impeccable business reputation. A person is not elected as a member of the Management Board if the person's earlier activities have caused the bankruptcy or compulsory liquidation or revocation of the activity licence of a company, or from whom the right to engage in economic activity has been taken away pursuant to law, or whose earlier activities as a manager of a company have shown that he or she is not capable of organising the management of a company such that the interests of the shareholders, members, creditors and clients of the company are adequately protected, or whose earlier activities have shown that he or she is not suitable to manage a company for other good reasons.
In order to ensure compliance with the above requirements, internal rules have been established in the Bank for evaluation of suitability of members of management bodies: suitability is evaluated both prior to the election of a person concerned and if necessary during his or her term of office. In order to ensure sustainable competence of members of the Management Board, there is a prescribed procedure in the Bank for regular self-education of members of the Management Board.
There is an effective common remuneration policy in Krediidipank Group, which has been approved by the Supervisory Board of the Bank and which efficiency, purposefulness and compliance are verified by the Remuneration Committee. The remuneration policy applies uniformly to both employees and members of the Management Boards of the companies in the Group.
The effective structure of remuneration in Krediidipank Group consists of three parts:
- Basic salary (fixed and variable remuneration for successful performance);
- Performance pay, in accordance with the profitability of the Bank's Group, which is based on the return on assets;
- Bonus, which is paid for an outstanding achievement.
Performance pay is payable in cash in the period following the accounting period to those employees who have contributed to the achievement of the result while observing the objective and values of the Group and are continually employees of the Group. No share-based or option-based performance incentives are prescribed. Performance pay supports efficient risk management and does not encourage the taking of excessive risks. To complement the salary, there are also other non-monetary bonuses, e.g. flexible working hours, various joint events and additional paid holiday depending on the length of employment.