Jsc Halyk Reg S Regulatory News (HSBK)

4 Feb 2008 09:04

JSC Halyk Savings Bank Kazakhstan04 February 2008 4 February 2008 Joint Stock Company 'Halyk Savings Bank of Kazakhstan' Preliminary unaudited consolidated results for the year ended 31 December 2007 Joint Stock Company 'Halyk Savings Bank of Kazakhstan' (Halyk Bank) (LSE: HSBK)today announces its preliminary unaudited consolidated financial results for theyear ended 31 December 2007. These have been prepared in accordance withInternational Financial Reporting Standards. • Net income increased by 49% from KZT 27.2 billion in 2006 to KZT 40.5billion in 2007 • The key driver of net income growth was net interest income beforeimpairment charges, up 53% in comparison to 2006 • Net interest margin remained strong at 6.7% in 2007 • The ratio of operating expenses(1) to operating income beforeimpairment charges(2) (cost-to-income ratio) improved from 39.7% in 2006 to34.9% in 2007 • Loans to customers increased by 74% to KZT 1,040.3 billion as at YE2007 • Total assets were up 61% to KZT 1,595.5 billion as at YE2007 • Growth in retail deposits reached 70% in 2007: from KZT 209.9 billionas at YE2006 to KZT 357.4 billion as at YE2007 • Total amounts due to customers increased by 56% to KZT 935.1 billion asat YE2007 • Total equity increased by 33% from KZT 120.6 billion as at YE2006 toKZT 160.8 billion as at YE2007 • Capital adequacy remained strong with the total capital adequacy ratioat 12% and the Tier 1 ratio at 9% as at 15 January 2008 according to therequirements of the FMSA(3). • Loans to customers / amounts due to customers ratio increased from1.00x as at YE2006 to 1.11x as at YE2007 • Liquid assets/total assets remained strong at 31.2% as at YE2007 • Return on average common shareholders equity as well as return onaverage assets remained strong in 2007 at 32.8% and 3.2%, respectively • According to the Statistical Bulletin of the National Bank ofKazakhstan, Halyk Bank's market shares (based on unconsolidated numbers) as at30 November 2007 were 12.7% in total assets, 21.3% in total deposits, 24.9% inretail deposits, and 17.1% in net income The exact announcement date of the final audited consolidated financial resultsfor the year ended 31 December 2007 will be communicated in due course throughRNS and Halyk Bank's web-site. CONSOLIDATED SUMMARY BALANCE SHEET As at Variations 31-Dec-07 30-Sep-07 31-Dec-06 31-Dec-055 2007/06 3Q07/YE06 2006/05 (4) (5) (unaudited) (reviewed) (audited) (audited) (KZT millions) (%) AssetsCash and cash equivalents 247,855 172,744 127,799 57,102 94 35 124Obligatory reserves 87,268 80,814 55,106 8,632 58 47 538Financial assets at fair 44,596 48,033 53,016 50,018 (16) (9) 6value through profit or lossAmounts due from credit 10,789 4,974 2,049 2,777 427 143 (26)institutionsAvailable-for-sale investment 107,839 144,518 123,339 12,099 (13) 17 919securitiesLoans to customers 1,040,273 905,102 596,216 411,097 74 52 45Property, equipment, 29,919 24,918 21,215 11,722 41 17 81intangible assets andgoodwillInsurance assets 3,886 5,666 5,626 - (31) 1 -Other assets 23,046 21,229 6,993 6,218 230 204 12Total assets 1,595,471 1,407,998 991,359 559,665 61 42 77 LiabilitiesAmounts due to credit 248,002 222,167 118,719 107,284 109 87 11institutionsAmounts due to customers: 935,133 767,169 597,935 323,515 56 28 85Debt securities issued 224,492 239,853 134,413 58,814 67 78 129Provisions 1,875 1,284 3,021 2,280 (38) (57) 33Deferred tax liability 3,809 2,645 2,530 425 51 5 495Insurance liabilities 7,389 8,827 7,535 - (2) 17 -Other liabilities 13,928 13,112 6,579 2,903 112 99 127Total liabilities 1,434,628 1,255,057 870,732 495,221 65 44 76 Shareholders' equity:Share capital 65,476 65,483 60,684 29,016 8 8 109Share premium reserve 2,001 2,001 2,183 2,192 (8) (8) -Treasury shares (42) (42) (38) (16) 11 11 138Retained earnings and other 92,053 84,498 56,736 32,806 62 49 73reserves Minority interest 1,355 1,001 1,062 446 28 (6) 138Total shareholders' equity 160,843 152,941 120,627 64,444 33 27 87 Total liabilities and 1,595,471 1,407,998 991,359 559,665 61 42 77shareholders' equity CONSOLIDATED SUMMARY STATEMENT OF INCOME For the period ended Variations 31-Dec-07 30-Sep-074 31-Dec-065 31-Dec-055 2007/06 2006/05 (unaudited) (reviewed) (audited) (audited) (KZT millions) (%) Interest income 132,566 89,331 80,647 52,385 64 54Interest expense (61,565) (39,706) (34,184) (21,156) 80 62Net interest income before impairment 71,001 49,625 46,463 31,229 53 49Impairment charge (22,107) (13,481) (8,331) (11,970) 165 (30)Net interest income 48,894 36,144 38,132 19,259 28 98 Fees and commissions, net 23,906 16,504 21,135 15,248 13 39Other non interest income 17,265 14,798 5,305 4,419 225 20Non interest expense (39,143) (24,689) (28,971) (19,559) 35 48 Income before income tax expense 50,922 42,757 35,601 19,367 43 84Income tax expense (10,438) (10,313) (8,442) (3,539) 24 139Net income 40,484 32,444 27,159 15,828 49 72Minority interest in net income (428) (239) (500) (200) (14) 150Net income attributable to equity 40,056 32,205 26,659 15,628 50 71holders of the parent KEY FINANCIAL RATIOS AND STATISTICS As at 31-Dec-07 30-Sep-07 31-Dec-06 31-Dec-05Amounts due to customers / total 65.2% 61.1% 68.7% 65.3%liabilitiesLoans to customers / amounts due to 1.11x 1.18x 1.00x 1.27xcustomers ratioLiquid assets / total assets 31.2% 32.0% 36.4% 23.3%Provisions / gross loans 5.2% 5.0% 5.3% 5.9%Tier 1 capital adequacy ratio (FMSA) 9.0%(6) 7.9% 9.5% 8.5%Total capital adequacy ratio (FMSA) 11.9%6 12.9% 16.6% 15.7% Number of branches and outlets 670 665 617 578Number of ATMs 1,166 998 697 585Number of POS-terminals 3,375 3,245 2,851 1,976 For the period ended 31-Dec-07 30-Sep-07 31-Dec-06 31-Dec-05Cost-to-income 34.9% 30.5% 39.7% 38.4%Return on average common shareholders' 32.8% 38.2%(7) 43.3% 38.5%equity (ROAE)Return on average assets (ROAA) 3.2% 3.8%7 3.5% 3.0%Net interest margin 6.7% 6.8%7 7.0% 6.9%Net interest spread 6.7% 6.8%7 6.8% 6.7% About Halyk Bank Halyk Bank is one of Kazakhstan's leading financial services groups and aleading retail bank with the largest customer base and distribution networkamong Kazakh banks. Halyk Bank is developing as a universal financial servicesgroup offering a broad range of services (banking, pensions, insurance, leasing,brokerage and asset management) to its retail, small and medium enterprise ("SME") and corporate customers. It is seeking further expansion of its internationaloperations and credit exposure in the region. Halyk Bank is rated by the threemain rating agencies: Moody's Investor Service (Ba1), Fitch Ratings (BB+) andStandard&Poor's (BB+). As at 31 December 2007 Halyk Bank's branch network consisted of 670 outlets,comprising 22 regional branches, 125 district branches, 473 limited servicebranches, 46 personal service centres, and 4 VIP centres; the number of ATMs was1,166 and point-of-sale terminals was 3,375. Key events in 2007 • In March 2007 Halyk Bank successfully completed a post-IPO issue of9,432,877 common shares. • On 18 April 2007 Halyk Bank's special purpose vehicle subsidiary, HSBK(Europe) B.V., raised a syndicated loan facility for a nominal principal amountof USD 400 million with a two-year tenor and an extension option for one yearvia a syndicate of international banks. The benchmark loan bears a margin of 30bps over LIBOR for the first two years with a step-up to 70 bps for the thirdyear. • On 23 April 2007 the Annual General Shareholders Meeting of Halyk Bankresolved to increase the number of members of the Board of Directors and toelect Mr. Christof Ruehl and Sir Gavyn Arthur (both London-based) as newindependent non-executive directors. • At the Annual General Shareholders Meeting held on 23 April 2007shareholders approved a dividend of KZT2.50 per common share, totalingapproximately KZT 2,450 million, and KZT15.04 per preferred share, totalingKZT1,579 million. • On 3 May 2007 the Bank's special purpose vehicle subsidiary, HSBK(Europe) B.V., successfully placed 10-year Eurobonds for the nominal principalamount of USD 700 million fully guaranteed by the Bank and priced at 220 bpsover mid-swaps. • On 9 June 2007 the Bank was nominated the Best Retail Bank in CentralAsia by the Asian Banker. • On 28 September 2007 the Bank registered its third bond program for anaggregate nominal principal amount of KZT 200 billion with the FMSA. Under thisprogram in October 2007 the Bank issued 10-year subordinated bonds denominatedin Tenge in the aggregate nominal principal amount of KZT 10 billion bearing acoupon of 11%. The major holders of the bonds are domestic pension funds andasset management companies. • On 1 October 2007 the Bank raised a syndicated loan facility for anominal principal amount of USD 300 million with a 3-year tenor from a syndicateof international banks. The benchmark loan bears a margin of 40 bps over LIBOR. • In November 2007 the Board of Directors of Halyk Bank approved anupdate and continuation of its Group Strategy until 2010. The full outline ofthe Halyk Group Strategy for 2008-2010 is available at: http://eng.halykbank.kz/bank/halyk_group_strategy_for_2008_2010 • On 7 December 2007 FMSA authorized Halyk Bank to establish subsidiarybanks in Georgia and Mongolia, as well as a subsidiary non-banking financialorganisation in Mongolia. • On 26 December 2007 Halyk Bank, together with "Kar-Tel" LLP(www.beeline.kz) and Visa International (www.visa.com) announced the launch of ajoint project, which placed Halyk Bank applet on the Beeline SIM-card, enablingdirect payment for goods and services from mobile phones using "Verified by Visa" technology. • Euromoney recognized Halyk Bank as "A Leading Bank in CorporateGovernance in Emerging Europe" in its "World's Best Banks in CorporateGovernance 2007" survey. - END- For further information please contact: Dauren Karabayev daurenk@halykbank.kz +7 727 259 88 66 Assel Atinova asela@halykbank.kz +7 727 259 04 30 Zhanar Kairbayeva ZhanarKai@halykbank.kz +7 727 244 77 65 Financial Dynamics London: Paul Marriott paul.marriott@fd.com +44 (0)20 7269 7252 David Cranmer david.cranmer@fd.com +44 (0)20 7269 7217 Moscow: Leonid Solovyev leonid.solovyev@fd.com +7 495 795 06 23 -------------------------- (1) Operating expenses are non interest expense (2) Operating income before impairment charges is net interest income beforeimpairment, fees and commissions, net and other non interest income (3) The Agency of Kazakhstan on Regulation and Supervision of Financial Marketsand Financial Organisations (4) Figures were extracted from the reviewed consolidated financial statementsfor 9 months ended 30 September 2007 (5) Figures were extracted from the audited consolidated financial statementsfor 3 years (6) As at 15 January 2008 (7) Annualised This information is provided by RNS The company news service from the London Stock Exchange