Sberbank / Key word(s): Statement/Miscellaneous
07.10.2015 09:30

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Sberbank releases Financial Highlights for 9M 2015 (under RAS; non-consolidated)

Please note that the numbers are calculated in accordance with Sberbank's internal methodology.

October 7, 2015

Key highlights for September, 2015:

  - Net income totaled RUB32.4 bn in September. 

- Total clients' funds increased by 2.6% in September, where corporate deposits and accounts +4.9%, retail deposits +1.2%.
- Financial efficiency demonstrates further improvement: Cost-to-Income ratio for 9M 2015 decreased to 38.9% vs. 39.5% for 8M 2015
Deputy Chairman of Sberbank Alexander Morozov stated: "September net profit of RUB32.4 bn is the best result since September 2014 and is in-line with our expectations. We keep focusing on strengthening the efficiency of our business"

Analysis of the Statement of Financial Position and Statement of Profit or Loss for 9M 2015, as compared to the same period a year earlier:
- Interest income increased by 24.6% y-o-y, interest expenses increased by 75.8% y-o-y. Net interest income decreased by 16.3% y-o-y
- Noncredit commission income grew by 19.2% y-o-y, net fee and commission     income increased by 6.0% y-o-y

- Operating income before total provisions decreased by 10.1% y-o-y
- Total provision charge was RUB303.7 bn vs. RUB217.8 bn charge for 9M     2014

  - Operating expenses decreased by 0.9% y-o-y 

- Net profit before income tax reached RUB181.8 bn vs. RUB360.4 bn for 9M     2014

- Net profit totaled RUB144.4 bn vs. RUB286.7 bn for 9M 2014
Comments:

Net interest income came at RUB532.6 bn, down by 16.3% compared to that for 9M 2014. The pace of net interest income growth in 2015 is catching up to 2014 rate: 17.6% for 8 months and 16.3% for 9 months.
- Interest income increased by RUB281.4 bn, or 24.6%, driven mostly by corporate loan portfolio growth and improving yield, as well as retail     loan portfolio growth.

- Interest expenses increased by RUB385.1 bn, or 75.8%, due to the increase in market interest rates and inflow of funds. The strongest impact on interest expense for 9M 2015 came from client deposits and the CBR funding . Slowdown in interest expenses growth continues due to gradual decrease in the CBR's key interest rate since the beginning of 2015. The increase in interest expense on deposits in September m-o-m is related to transfer of contributions to the Deposit Insurance Agency     for the 3rd quarter (RUB 9.0 bn).

Net fee and commission income came at RUB207.4 bn, up by 6.0%. The Bank continued to demonstrate growth of net fees and commission income despite the decline in commission income from corporate lending and banking insurance. Transactions with bank cards and acquiring remained the main drivers.

Net income from FX revaluation and trading operations on capital markets amounted to RUB41.2 bn for 9M 2015 compared to RUB32.6 bn for 9M 2014.
Operating expenses decreased by 0.9% y-o-y for 9M 2015 due to the Bank's cost optimization program. Effective 2015 the Bank started to apply the accrual method in accounting for employee compensation expenses in order to smoothen the expenses distribution across the year. For comparison purposes the same accounting principle was applied to staff costs for 2014.
Excluding the accrual effect in accounting for employee compensation expenses for the same period of 2014, operating expenses increased by 1.3%.
Total provision charges amounted to RUB303.7 bn for 9M 2015 vs. RUB217.8 bn a year earlier. In September amount of provision charge came at RUB25.9 bn which is lower than the average monthly number for the previous 8 months (RUB34.7 bn). The Bank continues to create provisions in accordance with requirements of the Central Bank of Russia. Loan-loss provisions are 2.1 times the overdue loans.

Net profit before income tax came at RUB181.8 bn for 9M 2015 vs. RUB360.4 bn a year earlier. Net income reached RUB144.4 bn for 9m2015 compared to 286.7 bn for 9m2014.

Assets increased by 1.7% in September to reach RUB22.0 trln driven by funds placements with other banks and interbank loans as part of liquidity management.

The Bank lent about RUB0.8 trln to corporate clients in September. Loan issues from the beginning of the year were about RUB4.3 trln. Total corporate loan portfolio in September remained unchanged at RUB11.8 trln.
The Bank lent over RUB100 bn to retail clients in September, from the beginning of the year was about RUB850 bln. Total retail loan portfolio increased by RUB9 bln, or 0.2%, in September stood at RUB4.1 trln. The share of mortgages in total retail portfolio continues to increase to reach 52.1% as of October 1, 2015 from 47.8% as of January 1, 2015.
Overdue loans decreased by 0.1p.p. to 2.9% of total loans in September. The level of overdue loans at Sberbank is two times lower than the level of the banking sector's average.

Securities portfolio was up by RUB46 bn in September, or by 2.7%, due to purchases of Eurobonds and OFZ bonds. The portfolio ending balance was RUB1.8 trln as of October 1, 2015.

Retail deposits and accounts increased by RUB112 bn in September, or up by 1.2%. Overall retail deposits and accounts portfolio reached RUB9.8 trln as of October 1, 2015. Since the beginning of the year retail funds increased by RUB1.25 trln, or by 14.7%, whereas the portfolio was up by 0.2% during the same period last year.

Corporate funding increased by RUB283 bn in September, or by 4.9%, due to term deposits. Overall corporate clients' funding increased by 19.1% during 9M 2015 to reach RUB6.0 trln.

Core Tier 1 and Tier 1 capital (equal since Sberbank does not have instruments of additional capital) reached RUB1,794 bn as of October 1, 2015 under preliminary calculations. Tier 1 capital increased by RUB86 bn in September primarily due to 1H2015 audited net profit. Total capital amounted to RUB2,586 bn on the same date, up by RUB50 bn in September primarily due to September net profit and revaluation of securities.
Capital adequacy ratios under preliminary calculations as of October 1, 2015 were:

- N1.1 - 8.64% (minimum adequacy level, required by the Central Bank of     Russia at 5.0%)

- N1.2 - 8.64% (minimum adequacy level, required by the Central Bank of     Russia at 6.0%)

- N1.0 - 12.40% (minimum adequacy level, required by the Central Bank of Russia at 10.0%, considering Deposit Insurance Regulation).
Sberbank 9M 2015 Financial Highlights (under RAS, non-consolidated)

07.10.2015 The EquityStory.RS, LLC Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Media archive at www.dgap-medientreff.de and www.dgap.de

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Language:     English
Company:      Sberbank
              19 Vavilova St.
              117997 Moscow
              Russia
Phone:        +7-495-957-57-21
Fax:          
E-mail:       media@sberbank.ru
Internet:     www.sberbank.ru
ISIN: US80585Y3080, RU0009029540, RU0009029557, US80585Y4070 Listed: Open Market (Entry Standard) in Frankfurt ; London, MICEX,               RTS
 
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