Jsc Halyk Reg S Regulatory News (HSBK)

8 May 2007 12:09

JSC Halyk Savings Bank Kazakhstan08 May 2007 8 May 2007 Press Release JSC Halyk Bank of Kazakhstan ("Halyk Bank" or "the Bank") Unaudited consolidated financial results for the quarter ended 31 March 2007 (The first-quarter financial statements have not been audited by an external auditor nor have they been approved by the Board of Directors or the GeneralShareholders Meeting of the Bank. The Bank does not intend to obtain the opinion of external auditors nor approval from the Board of Directors or the General Shareholders Meeting on these financial statements.) STRONG EARNINGS GROWTH MOMENTUM FROM 2006 CONTINUES INTO Q1 2007 PROVIDING SOLID BASIS FOR SUSTAINABLE AND BALANCED GROWTH IN 2007 Financial Highlights - Net income after tax increased by 107% compared with Q1 2006, to KZT 10,849 million - Operating income increased by 82% compared with Q1 2006, to KZT 23,174 million - Net interest income increased by 96% compared with Q1 2006, to KZT 14,556 million - Cost to income ratio remains strong at 37.2% - Net loan portfolio increased by 8% compared with 31 December 2006, to KZT 643,786 million - Capital adequacy remains strong at 18%* with Tier 1 at 15%* * In accordance with Basel Financial Overview The Bank's consolidated net income after tax increased by 107 percent to KZT10,849 million in the first quarter of 2007 from KZT 5,234 million in theequivalent period in 2006. This increase was mainly attributable to an increasein net interest income of 96 percent and a significant increase in othernon-interest income. Operating income, which includes net interest income, net fee and commissionincome and other non-interest income, increased by 82 percent to KZT 23,174million in the first quarter from KZT 12,757 million in 2006. Net interest income, representing 59 percent of operating income, increased by96 percent to KZT 14,556 from KZT 7,438 million in the first quarter of 2006,mainly due to increases in the average loan portfolio and our share of retailloans which typically earn higher interest. Lower impairment charges as at 31March 2007 resulted from general improvement in the overall quality of the loanportfolio. Other non-interest income increased to KZT 3,459 million in the first quarter of2007, up from KZT 195 million in 2006, primarily as a result of increases involumes of foreign currency dealing operations, full consolidation of JSCKazakhinstrakh (the non-life insurance subsidiary of the Bank) starting fromNovember 2006 and increased earnings from leasing operations. The net loan portfolio increased by 8 percent to KZT 643,786 million as at 31March 2007 from KZT 596,216 million at the end of 2006 as a result of an overallincrease in lending activity of the Bank across all three of the Bank's corebusiness lines - retail, SME and corporate banking. Despite increase in the loanportfolio, the Bank's total assets decreased by 1 percent to KZT 979,951 millionas at 31 March 2007 from KZT 991,359 million as at 31 December 2006 due todecreases in cash and cash equivalents and in the investment securitiesportfolio. Halyk Bank is one of Kazakhstan's leading financial services groups and itsleading retail bank with the largest customer base and distribution network ofany bank in Kazakhstan. The Bank is developing as a universal financial groupoffering a broad range of services (banking, pensions, insurance, leasing,brokerage and asset management) to its retail, small and medium enterprise ("SME") and corporate customers. The Bank is rated by the three main rating agencies:Moody's Investor Service (Ba1), Fitch Ratings (BB+) and Standard&Poor's (BB+). Contact details: Dauren Karabayev daurenk@halykbank.kz 007 327 259 88 66 Assel Atinova asela@halykbank.kz 007 327 259 04 30 APPENDIX CONSOLIDATED SUMMARY BALANCE SHEET KZT millions As at March 31, 2007 December 31, 2006Assets Cash and cash equivalents 62,374 127,799 Obligatory reserves 53,564 55,106 Financial assets at fair value through profit or loss 55,104 53,016 Amounts due from credit institutions 2,308 2,049 Available-for-sale investment securities 122,380 123,338 Loans to customers, net 643,786 596,216 Property and equipment, net 17,352 16,412 Insurance assets 4,756 5,626 Other assets 18,327 11,796Total assets 979,951 991,359 Liabilities Amounts due to credit institutions 106,008 118,719 Amounts due to customers: 571,267 597,935- Retail 234,317 209,877- Corporate 336,949 387,347 Debt securities issued 144,237 134,413 Provisions 2,247 3,021 Deffered tax liability 1,665 2,530 Insurance liabilities 7,041 7,535 Other liabilities 12,057 6,579Total liabilities 844,523 870,732 Shareholders' equity: Share capital 65,048 60,684 Share premium reserve 2,008 2,183 Treasury shares (41) (39) Retained earnings and other reserves 67,386 56,736 134,401 119,565 Minority interest 1,027 1,062Total shareholders' equity 135,428 120,628 Total liabilities and shareholders' equity 979,951 991,359 CONSOLIDATED SUMMARY STATEMENTS OF INCOME KZT millions For the three-month period ended March 31, 2007 March 31, 2006 Interest income 25,431 17,276 Interest expense (10,869) (6,625) Net interest income before impairment 14,562 10,651Impairment charge (6) (3,212)Net interest income 14,556 7,438 Fees and commissions, net 5,159 5,124 Non interest income 3,459 195 Non interest expense (8,551) (6,049) Net income after income tax expense 10,849 5,234 Net income after minority interest 10,849 5,234 This information is provided by RNS The company news service from the London Stock Exchange