SBER.L Regulatory News (SBER)

SberBank releases Financial Highlights for January 2022 (under RAS, non-consolidated)

The numbers are calculated in accordance with SberBank's internal methodology.

Please note that some minor changes became effective in SberBank's internal methodology starting from January 1, 2022. Therefore, the numbers for 2021 have been recalculated to make them comparable.

The effect of subsequent events is excluded from the numbers as of January 1, 2022.

February 7, 2022

Key highlights for January:

Alexandra Buriko, CFO, stated:

"In spite of high volatility in the capital markets, Sber demonstrated solid business dynamics and strong profitability. The net profit exceeded RUB100 bn, while return on equity reached 22%. The retail lending demand remained strong in January, with loan originations surpassing RUB400 bn, excelling the retail portfolio by 1.3%."

Comments for January:

Net interest income grew by 14.8% y/y to RUB148.7 bn, led by the loan portfolio expansion. The net interest margin demonstrated stable dynamics.

Net fee and commission income was up by 7.6% y/y and amounted to RUB39.7 bn. Excluding the impact of the methodological changes in accounting for the loyalty program and other commissions the growth in January would have been 15%. The main growth driver remains transactions with banking cards, including acquiring.

Operating expenses amounted to RUB49.1 bn, up by 10.7% y/y, mainly from the salary indexation in light of high inflation base. Cost-to-Income ratio remained at the level of last year at 23.5%.

Provision charge including fair-value revaluation in January totaled RUB36.4 bn. Rouble weakening against major currencies during the month resulted in additional provisions in the amount of RUB16.9 bn without quality deterioration in the underlining assets. Excluding the FX impact the provisioning level was comparable to that of January last year.

The share of overdue loans in total loan portfolio changed insignificantly to reach 2.4%.

Loan-loss provisions were 2.6 times the overdue loans.

Net profit before income tax in January increased by 15.0% y/y and amounted to RUB123.5 bn. Net profit increased by 15.6% y/y to RUB100.2 bn.

Total assets in January increased by 0.3% excluding the effect of FX revaluation to RUB38.4 trn.

The Bank issued over RUB0.9 trn in loans to corporate clients in January. The portfolio was up by 1.2% to RUB17.2 trn. The Rouble loan portfolio increased by 1%.

Loan production to retail clients in January was RUB404 bn with growth across all segments. Total retail portfolio was up by 1.3% for the month to exceed RUB10.8 trn.

The securities portfolio was up by 0.2% to RUB5.14 trn in January mainly from purchases of the corporate bonds.

Retail client funding decreased by 3.0% in January, or by RUB0.5 trn, which is season's common dynamics following strong inflows of funds in December last year. The ending balances of the escrow accounts continued to grow, supported by mortgage lending.

Corporate client funding in January were up by 5.0%, or by RUB0.4 trn, nearly offsetting the outflows of retail funding, to RUB9.4 trn.

Core Tier 1 and Tier 1 capital in January came down by RUB12 bn to RUB3,787 bn and RUB3,937 bn, respectively, while total capital decreased by RUB38 bn to RUB5,120 bn from negative revaluation of securities at fair value through other comprehensive income in light of high market volatility in January. Moreover, CET1 and T1 capital do not yet include profit for 2021, which will happen upon its audit.

CET1 and T1 capital ratios were 10.12% and 10.52%, respectively, as of February 1, 2022. When audited, the profit for 2021 would add about 2.5pp to capital ratios.

Risk-weighted assets* in January increased by RUB1.1 trn to RUB37.5 trn from loan portfolio growth.

* preliminary calculations

Sberbank Financial Highlights for 1M 2022 (under RAS, non-consolidated)