Operating expenses

RUB million 2011 2010 Change, %
Staff costs 203,802 161,180 26.4
Depreciation of premises and equipment and other costs
related to premises and equipment
78,849 60,792 29.7
Administrative and information services expenses 33,271 22,414 48.4
Taxes other than on income 11,712 12,586 -6.9
Other 20,709 8,929 131.9
Total operating expenses 348,343 265,901 31.0

The Group’s operating expenses grew 31.0% to RUB 348.3 billion in 2011. Staff costs, which account for 58.5% of operating expenses in 2011, represent the main item of operating expenses. Staff costs increased 26.4% to RUB 203.8 billion, driven by the planned implementation of a programme to bring salaries into conformity with the current market level, as well as by increased investments in staff professional development and skills training and higher bonuses resulting from the Group’s strong performance in 2011. Detailed information on investments in the Group’s personnel can be found in chapter 17 of this report — Investing in Human Capital.

The combined increase in other items of operating expenses was 38%. Depreciation and maintenance charges on premises and equipment and administrative and information services expenses showed the strongest growth due to investments in IT infrastructure and the reformatting of network of outlets in accordance with the Group’s development strategy. Detailed information on the development of our IT infrastructure and the Group’s branch network can be found in chapters 5 and 16 of this report — Bank Development and Ensuring Accessibility of Banking Services.


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