Last checked at 17 Aug 2015 08:10
JSC Halyk Bank / Miscellaneous 17.08.2015 08:10 Dissemination of a Regulatory Announcement, transmitted byEquityStory.RS, LLC - a company of EQS Group AG.The issuer is solely responsible for the content of this announcement.--------------------------------------------------------------------------- 17 August 2015 Joint Stock Company 'Halyk Savings Bank of Kazakhstan' Consolidated financialresults for the six months ended 30 June 2015 Joint Stock Company 'Halyk Savings Bank of Kazakhstan' and its subsidiariestogether 'the Bank') (LSE: HSBK) releases its condensed interim consolidatedfinancial information for the six months ended 30 June 2015. 6 months 2015 financial highlights * Net income is down 13.7% YoY to KZT 55.3bn;* Net interest income before impairment charge is up by 16.5%;* Impairment charge is up by 19.5%;* Net interest income is up by 16.4%;* Fees and commissions from transactional banking are up by 16.0%;* Net interest margin is up to 6.7% p.a. (5.6% p.a. for 1H 2014);* Cost-to-income ratio is at 30.3% (26.8% for 1H 2014);* RoAE is at 23.3% p.a. (32.1% p.a. for 1H 2014);* RoAA is at 3.9% p.a. (4.7% p.a. for 1H 2014); * Total assets are up by 5.2%, YTD;* Net loans to customers are up by 6.7%;* Total equity is flat;* NPLs 90-day+ ratio is up to 13.3% (12.9% as at 31 December 2014);* Cost of risk1 is at 0.0% p.a. (0.1% p.a. for 1H 2014). 2Q 2015 financial highlights * Net income is up 8.4% YoY to KZT 28.3bn;* Net interest income before impairment charge is up by 18.6%;* Net interest income is up by 11.4%;* Fees and commissions from transactional banking are up by 13.4%;* Net interest margin is up to 6.7% p.a. (5.6% p.a. for 2Q 2014);* Cost-to-income ratio is at 28.1% (29.9% for 2Q 2014);* RoAE is at 23.7% p.a. (25.5% p.a. for 2Q 2014);* RoAA is at 4.0% p.a. (3.7% p.a. for 2Q 2014); * Total assets are up by 6.0%, q-o-q;* Net loans to customers are up by 5.2%;* NPLs 90-day+ ratio is down to 13.3% (13.6% as at 31 March 2015);* Cost of risk1 is at 0.2% p.a. (0.2% p.a. for 2Q 2014). Statement of profit or loss review Interest income increased by 14.2% for 1H 2015 vs. 1H 2014 mainly due to increasein average balances of net loans to customers by 12.2% and in average interestrate on net loans to customers to 12.5% p.a. for 1H 2015 from 12.0% p.a. for 1H2014. Interest expense increased by 10.4% for 1H 2015 vs. 1H 2014 mainly due tolocal bond issues in 1H 2015 and loans drawn from JSC Entrepreneurship DevelopmentFund 'Damu' ('DAMU') and JSC 'Development Bank of Kazakhstan' ('DBK'). Theincrease in interest expense was partially offset by decrease in average balancesof term deposits. As a result, net interest income before impairment chargeincreased by 16.5% to KZT 75.5bn for 1H 2015 vs. 1H 2014. Impairment charge increased by 19.5% mainly on the back of provisions created bythe Bank's brokerage company JSC Halyk Finance on certain of its investmentsecurities and, to lesser extent, due to increase in the Bank's consumer loans.Impairment charge increase was partially offset by KZT 1.7bn provision recoveriesduring 1Q 2015 due to the transfer of several problem loans to the SPVHalyk-Project LLP and the repayment of one large-ticket impaired corporate loan.Provisioning level decreased to 13.8% as at 30 June 2015 vs. 14.4% as at 31 March2015 vs. 14.8% as at 31 December 2014 mainly on the back of loan portfolio growth. Fee and commission income from transactional banking (i.e. excluding pension fundand asset management) increased by 16.0% for 1H 2015 vs. 1H 2014 as a result ofgrowing volumes of transactional banking business, mainly in bank transfers andpayment cards maintenance and, to a lesser extent, increase in tariffs. Other non-interest income (excluding insurance) decreased by 41.3% for 1H 2015 vs.1H 2014 mainly as a result of 36.0% decrease in net gain on foreign exchangeoperations due to translation losses on FX balance sheet items partially offset byhigher income from FX dealing operations as well as loss on sale of securitiesfrom available-for-sale portfolio in 1Q 2015. Other non-interest (excludinginsurance) income grew by 3.4% for 2Q 2015 vs. 2Q 2014 mainly due to increase innet gain on foreign exchange operations as a result of increased volumes of FXdealing operations. Operating expenses increased by 11.5% for 1H 2015 vs.1H 2014 mainly due toincrease in salaries of the Bank's employees starting from 1 July 2014. The Bank's cost-to-income ratio increased to 30.3% for 1H 2015 from 26.8% for 1H2014 mainly as a result of deconsolidation of pension fund business and, to alesser extent, due to consolidation of JSC Altyn Bank. The Bank's cost-to-incomeratio decreased to 28.1% for 2Q 2015 vs. 29.9% for 2Q 2014 due to higher operatingincome in 2Q 2015 driven by interest income growth. Statement of financial position review Total assets increased by 5.2% vs. YE 2014 mainly in amounts due from creditinstitutions (70.7%), cash and cash equivalents (14.8%), property and equipment(14.2%) and loans to customers (6.7%), partially offset by decrease inavailable-for-sale investment securities (-20.4%). Loans to customers increased by 5.5% on a gross basis and by 6.7% on a net basisvs. YE2014. Gross loan portfolio growth was attributable to increase in loansacross all types of businesses: corporate loans by 2.2%, SME loans by 7.4% andretail loans by 12.4%. 90-day NPL ratio decreased to 13.3% as at 30 June 2015 vs. 13.6% as at 31 March2015. The decrease in 90-day NPL ratio was mainly due to the Bank's loan portfoliogrowth during 2Q 2015. As at 30 June 2015, the Bank's IFRS provisions covered90-day NPLs by 102.7%. Term deposits of legal entities decreased by 3.1% and current accounts of legalentities increased by 14.4% vs. YE 2014. The decrease in term deposits was due topartial withdrawal of funds by some corporate clients in 1Q 2015 to finance theiron-going business needs. Term deposits and current accounts of legal entitiesincreased by 20.6% and 10.6%, respectively, vs. 31 March 2015 as a result of newfund inflow from corporate clients in 2Q 2015. Term deposits of individuals decreased by 10.4% and current accounts ofindividuals increased by 4.0% vs. YE 2014. The decrease in term deposits was dueto partial withdrawal of funds by some clients in 1Q 2015 and 2Q 2015. Amounts due to credit institutions increased by 11.1% vs. YE 2014 mainly due toloans drawn by the Bank from government entities within the framework of economystate support programmes. In January and March 2015, the Bank drew two KZT 6bnloans from DAMU to support small and medium businesses operating in processingindustries. In March 2015, the Bank drew a KZT 8bn loan from DBK to supportcorporate entities operating in processing industry. In April 2015, the Bank drewanother KZT 4bn loan from DBK within the framework of subsidised auto-lendingprogramme for retail customers. Debt securities issued increased by 41.4% vs. YE 2014 mainly due to seniorunsubordinated local bonds placed by the Bank with JSC Single Accumulated PensionFund during 1H 2015. The bonds were placed in several tranches for the totalamount of KZT 131.7bn at a 7.5% coupon rate and mature in February 2025. Theincrease in debt securities issued was partially offset by timely repayment of KZT4.0bn 10-year subordinated local bond bearing a coupon of inflation rate plus 1%on 13 April 2015. On 10 July 2015, the Bank made another scheduled repayment of KZT 3.0bn 10-yearsubordinated local bond bearing a coupon of 7.5%. Total equity remained flat vs. YE 2014 and decreased by 5.1% vs. 31 March 2015 dueto buy-back of the Bank's preferred shares in June 2015 at KZT 140.00 per share,totalling KZT 23.0bn and dividends paid by the Bank on its common and preferredshares. On 23 April 2015, the Bank's General Shareholder Meeting passed aresolution to pay dividends to common shareholders of KZT 34.3bn (KZT 3.14 percommon share) which equals to 30.0% of FY2014 consolidated net income and KZT2.6bn to preferred shareholders (KZT 13.44 per preferred share) which equals to2.3% of FY 2014 consolidated net income. The decrease in total equity waspartially offset by net profit earned during 2Q 2015. Starting from 1 January 2015, Kazakhstan regulator changed the minimum requiredcapital adequacy ratios to k1 - 7.5%, k1-2 - 8.5% and k2 - 10.0% from k1-1 - 5.0%,k1-2 - 5.0% and k2 - 10.0% previously. As at 30 June 2015, the Bank's regulatorycapital adequacy ratios were at k1 - 19.1%, k1-2 - 19.1% and k2 - 19.4% vs. k1 -20.0%, k1-2 - 21.0% and k2 - 21.3% as at 31 March 2015. Basel Tier 1 capitaladequacy ratio and total capital adequacy ratio were at 18.7% and 19.4%,respectively, as at 30 June 2015 vs. 20.8% and 21.4%, respectively, as at 31 March2015. The condensed interim consolidated financial information for the six months ended30 June 2015, including notes attached thereto, are available on Halyk Bank'swebsite http://www.halykbank.kz/en/financial-reports andhttp://www.halykbank.kz/en/news. For further information please contact: Halyk Bank Dauren Karabayev +7 727 259 68 10Viktor Skryl +7 727 259 04 27Mira Kasenova +7 727 259 04 30 1 impairment charge on loans to customers as a percentage of monthly averagebalances of gross loans to customers, annualised. 17.08.2015 The EquityStory.RS, LLC Distribution Services include RegulatoryAnnouncements, Financial/Corporate News and Press Releases.Media archive at www.dgap-medientreff.de and www.dgap.de --------------------------------------------------------------------------- Language: EnglishCompany: JSC Halyk Bank 109V, Abay ave 050008 Almaty KazakhstanPhone: +7 727 259 04 27Fax: +7 727 259 04 64E-mail: halykteam@halykbank.kzInternet: http://halykbank.kzISIN: US46627J3023Category Code: MSCTIDM: HSBKSequence Number: 2800Time of Receipt: Aug 17, 2015 08:10:23 End of Announcement EquityStory.RS, LLC News-Service ---------------------------------------------------------------------------UK-Regulatory-announcement transmitted by DGAP - a service of EQS Group AG.The issuer is solely responsible for the content of this announcement.