7 Apr 2015 09:48
Sberbank / Statement/Miscellaneous 07.04.2015 09:48 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.--------------------------------------------------------------------------- Sberbank releases Financial Highlights for Q1, 2015 (under RAS;non-consolidated) Please note that the numbers are calculated in accordance with Sberbank'sinternal methodology. Also note that the effect of subsequent events isincluded from the numbers as of January 1, 2015. April 7, 2015 Income Statement Highlights for Q1, 2015 (as compared to Q1, 2014): - Net interest income decreased by 29.0% y-o-y. Interest income increased by 31.5% y-o-y, but interest expenses increased by 111.6% y-o-y on more expensive cost of funding from the CBR and corporate deposits - Noncredit commission income grew by 14.8% y-o-y, net fee and commission income decreased by 0.8% y-o-y - Operating income before total provisions decreased by 22.2% y-o-y - Total provision charge was RUB78.6 bn vs. RUB70.3 bn charge for Q1, 2014 - Operating expenses were up by 6.3% y-o-y - Net profit before income tax reached RUB46.2 bn vs. RUB121.5 bn for Q1, 2014 - Net profit totaled RUB26.3 bn vs. RUB99.3 bn for Q1, 2014. Significant increase in cost of the CBR's funding and cost of client funds (mostly corporate funds) were the main drivers for the decline in Net profit. Net interest income came at RUB146.2 bn, down by 29.0% compared to that forQ1, 2014: - Interest income increased by RUB113.7 bn driven by corporate and retail loan portfolio growth. - Interest expenses increased by RUB173.3 bn, due to inflow of funds as well as increase of market interest rates. The strongest effect on interest expense came from the CBR funding and corporate deposits that reacted at a faster pace upon the increase in the key interest rate. Slowdown on interest expenses growth in March continued driven by thegradual decrease in the key interest rate by the CBR from the beginning of2014. Nevertheless, the CBR funding remains the most expensive source ofliquidity. In order to lower the average cost of funding, Sberbankcontinues reducing its CBR funding and replacing it with clients' funds. InMarch the share of the CBR funding (excluding the subordinated debt) intotal liabilities was reduced by 0.5 p.p. to 10.1% (15.2% as of January 1,2015). Net fee and commission income came at RUB58.4 bn in Q1, 2015 that wasslightly lower than in Q1, 2014 (RUB58.8 bn). Decline in commission incomefrom corporate lending was offset by noncredit commission income mostlydriven by bank cards and acquiring. Net income from FX revaluation and trading operations on capital marketsamounted to RUB2.8 for Q1, 2015. The negative result in March (-RUB14.9 bn)was driven mostly by release of loan-loss provision on FX loans againstRuble appreciation. To read more on the relationship between provisioncharge and conversion income, please note Sberbank releases FinancialHighlights for 11M 2014 (under RAS; non-consolidated). Operating expenses increased by 6.3% y-o-y for Q1, 2015 due to the increasein staff costs. Starting from February the Bank extended to apply theaccrual method in staff remuneration accounting to spread these costsacross the year. Please note that comparison to staff costs for the sameperiod of 2014 is not quite correct. Excluding the effect of thisadjustment, operating expenses for Q1, 2015 decreased by 1.9% y-o-y. Thegeneral trend of cost reduction is achieved by the Bank's cost optimizationprogram, especially in terms of administrative expenses. Bank optimizesprocurement system, utilizes real estate more efficient, systemically dealswith other expenses. Total provision charges amounted to RUB78.6 bn vs. RUB70.3 bn charge in Q1,2015. Comparing to the previous month, total provision charge in March wassubstantially lower (RUB8.6 bn), due to release of FX provisions on rubleappreciation. The Bank continues to practice a conservative approach inloan-loss provisioning based on requirements of the Central Bank of Russia.Coverage ratio remained strong: loan-loss provisions are 2.3 times theoverdue loans. Net profit before income tax came at RUB46.2 bn for Q1, 2015 vs. RUB121.5bn a year earlier. Net profit totaled RUB26.3 bn vs. RUB99.3 bn. Assets decreased by 3.2% in March to reach RUB20.7 trln. The decrease wasvisible in several line items of assets, including loans to clients and tobanks. The major factor that attributed to the decrease was negativerevaluation of FX component on ruble appreciation. The Bank lent over RUB400 bln to corporate clients in March, which iscomparable to average monthly volumes of issues. Total corporate loanportfolio decreased by 3.2% in March to RUB11.4 trln primarily fromnegative revaluation of previously issued FX loans. The Bank lent about RUB79 bn to retail clients in March, 61% of the issueswere mortgages. Yet total retail loan portfolio decreased by RUB19.5 bn inMarch to reach RUB4.03 trln on large volumes of repayments of consumerunsecured loans. Overdue loans increased slightly to reach 2.4% of total loans as of April1, 2015. Retail deposits and accounts increased by RUB47 bn in March, or up by 0.6%;the ending balances increased in all currencies. Should there have not beenthe revaluation effect the portfolio would have increased by RUB140 bn, orby 1.6%. The inflow of funds was both to deposits as well as savingscertificates. Overall retail deposits and accounts portfolio reachedRUB8.62 trln as of April 1, 2015. Corporate funding decreased by RUB399 bn in March, or down by 7.1%. Overallsince the beginning of the year the Bank raised RUB151 bn, or 3.0%, offunding on corporate term deposits. Core Tier 1 and Tier 1 capital (equal since Sberbank does not haveinstruments of additional capital) reached RUB1,754 bn as of April 1, 2015under preliminary calculations. Total capital amounted to RUB2,520 bn onthe same date. In-line with the recent change to the Federal Law №173-FZ on Additionalmeasures of support to the financial system of the Russian Federationeffective March 2015 Sberbank amended the terms of its outstandingsubordinated loans from the CBR of total nominal value of RUB500 bn:Sberbank elected the option (defined in the Law) to extend the term of thesubordinated loans to 50 years at the rate of 6.5% p.a. with a possibilityto rollover the duration term without a requirement of a consent from theCBR and an option to negotiate the interest rate after December 31, 2019.Sberbank received a confirmation from the CBR in March 2015 with anapproval to include the outstanding subordinated loans in Tier 2 capital. Risk weighted assets decreased by RUB150 bn in March due to credit risk onBalance Sheets items (RUB237 bn). Capital adequacy ratios under preliminary calculations as of April 1, 2015were: - N1.1 - 8.89% (minimum adequacy level, required by the Central Bank of Russia at 5.0%) - N1.2 - 8.89% (minimum adequacy level, required by the Central Bank of Russia at 6.0%) - N1.0 - 12.71% (minimum adequacy level, required by the Central Bank of Russia at 10.0%, considering Deposit Insurance Regulation). Sberbank 1Q, 2015 Financial Highlights (under RAS, non-consolidated) 07.04.2015 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: Sberbank 19 Vavilova St. 117997 Moscow RussiaPhone: +7-495-957-57-21Fax: E-mail: media@sberbank.ruInternet: www.sberbank.ruISIN: US80585Y3080, RU0009029540, RU0009029557, US80585Y4070Listed: Open Market (Entry Standard) in Frankfurt ; London, MICEX, RTSCategory Code: MSCTIDM: SBERSequence Number: 2588Time of Receipt: Apr 07, 2015 09:17:33 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.