TCS.L Regulatory News (TCS)

TCS Group Holding PLC Adopts New Dividend Policy and Announces Payment of Interim Dividend

Moscow, Russia - 2 December 2014.TCS Group Holding PLC (TCS LI) (the "Group"), Russia's leading provider of online retail financial services, including "Tinkoff Credit Systems" Bank ("TCS Bank") and Tinkoff Online Insurance, today announces that the Board of Directors has adopted a new dividend policy and declared an interim gross dividend of USD 0.303 per ordinary share/GDR (with each GDR representing one ordinary share) with a total dividend payment of up to USD 55 mln.

The dividend is expected to be paid on 17 December 2014 to the shareholders on the Group's register as at the record date of 12 December 2014, and the ex-dividend date is set on 11 December 2014.

Holders of the Group's GDRs will, according to the terms of the GDR deposit agreement, receive their dividends approximately 2 business days after the payment date.

Oliver Hughes, Chairman of the Management Board of TCS Bank, commented: "The decision to adopt a new dividend policy and to pay a dividend now has been taken after due consideration of a number of factors. It weighs the Group's need for capital with its earnings and shareholder value. We are confident that the Group's core business will continue to generate solid cash flow to support the dividend payment to our shareholders and thus enhance the shareholders' return. The distribution of excess capital in 2014 in the form of dividends will allow us to preserve the flexibility and retain sufficient capital to invest in the organic growth of our business."

The Group's has adopted the following Dividend Policy:

Pursuant to the Articles of Association, the Group may pay dividends out of its profits. To the extent the Group declares and pays dividends owners of GDRs on the relevant record date will be entitled to receive dividends payable in respect of class A shares underlying the GDRs, subject to the terms of the Deposit Agreement. The Group expects to pay dividends in US dollars. If dividends are not paid in US dollars, again subject to the terms of the Deposit Agreement, they will be converted into US dollars by the Depositary and paid to holders of GDRs net of currency conversion expenses.

Payments of dividends would be made provided that the management can reasonably anticipate that TCS Bank's N1 capital adequacy ratio would remain (after payment of dividends and for the period between dividend payments) at or above 14%.

Subject to that, the Group intends to distribute excess cash to its shareholders in the form of dividend, with the aim of enhancing total shareholder returns. The Board of Directors reserves the right to distribute dividend on a quarterly or semi annual basis as it deems appropriate.

This statement is a general declaration of intention and the actual declaration of dividends will require corporate action at the time a decision is taken, depending on the precise circumstances at that time.

In addition, payment of any such dividend will be subject to any restrictions under applicable law and regulations, the Articles of Association, available cash flow, dividends from the Group's subsidiaries and the Group's capital investment requirements.

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About the Group

TCS Group Holding PLC is an innovative provider of online retail financial services operating in Russia through a high-tech branchless platform. In order to support its branchless platform, the Group has also developed a "smart courier" network covering almost 600 cities and towns in Russia which allows next day delivery to many customers.

Since its launch in 2007 by Mr Oleg Tinkov, a renowned Russian entrepreneur with a long track record of creating successful businesses, the Group has grown into a leader in the Russian credit card market with a market share of 6.7% based on non-delinquent receivables (according to Central Bank of Russia (CBR) data, as of 1 October 2014). As of 1 November 2014, the Group has issued over 4.8 mln credit cards.

In addition to a market-leading credit card offering, the Group has developed a successful online retail deposits programme. The Group's other innovative lines of business include Tinkoff Online Insurance, which enables the Group to underwrite and sell its own innovative online insurance products, and Tinkoff Mobile Wallet, mobile payment solutions and financial services for Russian consumers.

As of 30 September 2014, the Group's total assets amounted to RUB 96.5 bn, net loans and advances to customers stood at RUB 74.7 bn and customer accounts (deposits) amounted to RUB 41.3 bn. In 9M 2014, the Group generated a net profit of RUB 2.8 bn and net interest income of RUB 23.1 bn.

The Group is well capitalised with the total capital ratio and Tier 1 capital ratio of 26.6% and 21.2%, respectively, in accordance with Basel III methodology.

Forward-looking statements

Some of the information in this announcement may contain projections or other forward-looking statements regarding future events or the future financial performance of the Group and TCS Bank. You can identify forward looking statements by terms such as "expect", "believe", "anticipate", "estimate", "intend", "will", "could," "may" or "might", the negative of such terms or other similar expressions. The Group and TCS Bank wish to caution you that these statements are only predictions and that actual events or results may differ materially. The Group and TCS Bank do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of the Group and TCS Bank, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, rapid technological and market change in the industries the Group operates in, as well as many other risks specifically related to the Group, TCS Bank and their respective operations.