VTB Group announces IFRS results for July and 7 months of 2018

VTB Bank, the parent company of VTB Group, today publishes its unaudited consolidated IFRS results for July 2018 and the 7 months ended 31 July 2018.

Income Statement

• Net profit was RUB 115.2 billion (70.2% increase year-on-year) in 7M 2018 and RUB 16.7 billion (70.4% increase year-on-year) in July 2018 versus net profit of RUB 67.7 billion in 7M 2017 and RUB 9.8 billion in July 2017. Net operating income before provisions grew 14.6% year-on-year in 7M 2018 and 15.6% year-on-year in July 2018;
• Net interest income was RUB 279.2 billion in 7M 2018, up 4.6% year-on-year, and RUB 41.1 billion in July 2018, up 3.3% year-on-year. Net interest margin was 4.1% in 7M 2018 and 4.1% in July 2018 unchanged versus 7M 2018 and down 10 bps versus July 2017;
• Net fee and commission income was RUB 54.3 billion in 7M 2018 and RUB 8.2 billion in July 2018, up 6.7% and 5.1% year-on-year, respectively;
• Total provision charge for credit losses and other provisions amounted to RUB 80.8 billion in 7M 2018 and RUB 11.8 billion in July 2018, down 12.2% and 26.3% year-on-year, respectively. Cost of risk was 1.5% in 7M 2018 and 1.1% in July 2018 versus 1.6% in 7M 2017 and 2.0% in July 2017;
• Staff costs and administrative expenses amounted to RUB 146.1 billion in 7M 2018 and RUB 21.4 billion in July 2018, up 2.9% and 10.3% year-on-year, respectively. Cost-to-income ratio was 39.4% in 7M 2018 and 39.1% in July 2018 versus 43.8% in 7M 2017 and 40.8% in July 2017.

Statement of Financial Position

• Total assets amounted to RUB 13,448.6 billion as of 31 July 2018, down 1.7% in July and up 3.9% year-to-date (30 June 2018: RUB 13,683.3 billion; 01 January 2018: RUB 12,947.4 billion). Gross loans and advances to customers grew 0.9% in July and 4.7% year-to-date to 10,298.8 billion as of 31 July 2018 (30 June 2018: RUB 10,206.2 billion; 01 January 2018: RUB 9,841.1 billion). Gross loans to legal entities increased by 0.6% in July and by 2.7% year-to-date, while gross loans to individuals increased by 1.7% in July and by 10.4% year-to-date;
• NPL ratio was 7.2% of total gross loans as of 31 July 2018 (1), down 40 bps month-on-month and up 30 bps year-to-date. As of 31 July 2018, NPL coverage ratio was 107.0% (30 June 2018: 102.3%; 01 January 2018: 107.9%);
• Total customer deposits decreased by 2.5% in July and increased by 4.9% year-to-date, reaching RUB 9,593.6 billion as of 31 July 2018. Deposits from legal entities decreased 4.9% in July and 0.6% year-to-date, while deposits from individuals grew 1.0% in July and 13.3% year-to-date;
• Loan-to-deposit ratio was 99.1% as of 31 July 2018 (30 June 2018: 95.7%; 01 January 2018: 99.6%);
• As of 31 July 2018, Tier 1 CAR was 12.5% (30 June 2018: 12.2%; 01 January 2018: 12.6%), and total CAR was 14.2% (30 June 2018: 13.9%; 01 January 2018: 14.4%).

(1) Subsequent to 30 June 2018 gross exposure of two borrowers was excluded from NPL category since they no longer met the definition of NPL. One of the borrowers was excluded from NPL calculation as of 31 July 2018, the other one was excluded as of 6M'2018 IFRS results reporting date (9th of August 2018), bringing NPL ratio (on proforma basis) down to 6.9%.