Last checked at 21 May 2015 08:11
JSC Halyk Bank / Miscellaneous 21.05.2015 08:11 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.--------------------------------------------------------------------------- 21 May 2015 Joint Stock Company 'Halyk Savings Bank of Kazakhstan' Consolidated financialresults for the three months ended 31 March 2015 Joint Stock Company 'Halyk Savings Bank of Kazakhstan' and its subsidiariestogether 'the Bank') (LSE: HSBK) releases its condensed interim consolidatedfinancial information for the three months ended 31 March 2015. 1Q 2015 financial highlights * Net income is down by 28.9% YoY and up by 20.5% QoQ to KZT 27.0bn; * Net interest income before impairment charge is up by 14.4%; * Recoveries of provisions at KZT 1.7bn; * Net interest income is up by 21.5%; * Fees and commissions from transactional banking are up by 19.0%; * Net interest margin is up to 6.6% p.a. (5.6% p.a. for 1Q 2014); * Cost-to-income ratio is at 32.9% (24.2% for 1Q 2014); * RoAE is at 22.8% p.a. (38.7% p.a. for 1Q 2014); * RoAA is at 3.9% p.a. (5.6% p.a. for 1Q 2014); * Total assets are down by 0.8%, YTD; * Net loans to customers are up by 1.4%; * Total equity is up by 5.4%; * NPLs 90-day+ ratio is up to 13.6% (12.9% as at 31 December 2014); * Cost of risk is at negative 0.3% p.a. (0.1% p.a. for 1Q 2014). Statement of profit or loss review Interest income increased by 12.8% for 1Q 2015 vs. 1Q 2014 mainly due to increasein average balances of net loans to customers by 16.0% and in average interestrate on net loans to customers to 12.4% p.a. for 1Q 2015 from 11.8% p.a. for 1Q2014. Interest expense increased by 10.2% for 1Q 2015 vs. 1Q 2014 mainly due tolocal bond issues in January and March 2015 and loans drawn from JSCEntrepreneurship Development Fund 'Damu' ('DAMU') and JSC 'Development Bank ofKazakhstan' ('DBK'). The increase in interest expense was partially offset bydecrease in average balances of term deposits. As a result, net interest incomebefore impairment charge increased by 14.4% to KZT 36.7bn for 1Q 2015 vs. 1Q 2014. The transfer of several problem loans to the SPV Halyk-Project LLP and therepayment of one large-ticket impaired corporate loan led to recoveries ofprovisions for KZT 1.7bn during 1Q 2015. During 1Q 2015 the Bank wrote-off fullyprovisioned non-performing loans for KZT 6.1bn. Loan write-offs and transfers toHalyk-Project brought down allowances for loan impairment by 1.9% vs. YE 2014 andprovisioning level to 14.4% as at 31 March 2015 vs. 14.8% as at 31 December 2014. Fee and commission income from transactional banking (i.e. excluding pension fundand asset management) increased by 19.0% for 1Q 2015 vs. 1Q 2014 as a result ofgrowing volumes of transactional banking business, mainly in bank transfers,payment cards maintenance and servicing customers' pension payments. Other non-interest income (excluding insurance) decreased by 85.7% for 1Q 2015 vs.1Q 2014 mainly as a result of (1) 75.7% decrease in gains on FX trading operationsin spot and forward markets, including translation losses on FX balance sheetitems (reported in the Statement of Profit and Loss as gain/loss from financialassets and liabilities at fair value through profit and loss and gain/loss onforeign exchange operations) due to lower volumes of trading and limited KZTliquidity in the market and (2) loss on sale of securities (mainly internationalbonds) from available-for-sale portfolio. Insurance underwriting income, less insurance expense, increased by 15.8% for 1Q2015 vs.1Q 2014 mainly due to growing volumes of life insurance business, whereasgeneral insurance business remained almost flat. Operating expenses increased by 16.6% for 1Q 2015 vs.1Q 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 32.9% for 1Q 2015 from 24.2% for 1Q2014 mainly as a result of deconsolidation of pension fund business and, to alesser extent, due to consolidation of JSC Altyn Bank. Statement of financial position review Total assets decreased by 0.8% vs. YE 2014 mainly in available-for-sale investmentsecurities (13.2%) and cash and cash equivalents (4.3%), partially offset byincrease in amounts due from credit institutions 63.4%) and loans to customers(1.4%). Loans to customers increased by 0.9% on a gross basis and by 1.4% on a net basisvs. YE2014. Gross loan portfolio increase was in consumer loans (5.9%) andmortgage (4.8%), partially offset by decrease in corporate loans (-0.2%) and loansto SME (-2.6%). 90-day NPL ratio increased to 13.6% as at 31 March 2015 vs. 12.9% as at 31December 2014. The increase in 90-day NPL ratio was mainly due to delinquencies inloans to borrowers in agricultural sector resulted from poor harvest last year. Asat 31 March 2015, the Bank's IFRS provisions covered 90-day NPLs by 104.5%. Term deposits of legal entities decreased by 19.6% and current accounts of legalentities increased by 3.4% vs. YE 2014. The decrease in term deposits was due topartial withdrawal of funds by some corporate clients to finance their on-goingbusiness needs. Term deposits and current accounts of individuals decreased by 6.9% and 5.7%,respectively, vs.YE 2014 mainly as a result of partial withdrawal of funds by someclients. Amounts due to credit institutions increased by 8.2% 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. Debt securities issued increased by 17.6% vs. YE 2014 mainly due to KZT 21.1bn andKZT 30.0bn senior unsubordinated local bonds placed by the Bank with JSC SingleAccumulated Pension Fund on 12 February 2015 and 3 March 2015, respectively. Bothplacements bear a 7.5% coupon rate and mature in February 2025. On 20 April and 20 May 2015, the Bank placed with JSC Single Accumulated PensionFund two other tranches of senior unsubordinated local bonds for KZT 30.0bn each,also bearing 7.5% coupon rate and maturing in February 2025. On 13 April 2015, at maturity, the Bank repaid in full KZT 4.0 bn 10-yearsubordinated local bond bearing a coupon of inflation rate plus 1%. Total equity increased by 5.4% vs.YE 2014 mainly on the back of net profit earnedduring 1Q 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 31 March 2015, the Bank's CARs wereas follows: k1 - 20.0%, k1_2 - 21.0% and k2 - 21.3%. On 23 April 2015, the Bank's General Shareholder Meeting passed a resolution topay dividends to common shareholders of KZT 34.3 billion (KZT 3.14 per commonshare) which equals to 30.0% of FY2014 consolidated net income and KZT 2.6 billionto preferred shareholders (KZT 13.44 per preferred share) which equals to 2.3% ofFY 2014 consolidated net income. The condensed interim consolidated financial information for the three monthsended 31 March 2015, including notes attached thereto, are available on HalykBank's websitehttp://www.halykbank.kz/en/financial-reports andhttp://www.halykbank.kz/en/news. For further information please contact: Halyk Bank Dauren KarabayevViktor SkrylMira Kasenova +7 727 259 68 10+7 727 259 04 27+7 727 259 04 30 21.05.2015 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: 2679Time of Receipt: May 21, 2015 08:11:31 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.