Bank Uralsib Announced 3Q and 9 Months 08 Financial Results under RAS
OREANDA-NEWS On 16 October BANK URALSIB (URALSIB or Bank) (RTS: USBN) reported its 3Q2008 and 9 months 2008 financial results under Russian Accounting Standards (RAS).
Net income reached 3.228 bln rubles during January-September 2008 vs net loss of 0.753 bln rubles y-o-y 2007. Pre-tax income amounted to 5.227 bln rubles for 9 months 2008 (180.4% growth vs y-o-y 2007).
During the reporting period the Bank's core banking income was swiftly growing. During 9 month period net interest income grew to 15.231 bln rubles, thus increasing by more than 2.2 times (122.8% growth) vs y-o-y 2007. The similar tendency was in 3Q2008 vs 3Q2007 - 5.700 bln rubles vs 2.490 bln rubles (128.9% growth).
Net fee and commission income during January-September 2008 exceeded 5.170 bln rubles, indicating 35.1% growth vs y-o-y 2007. During July-September 2008 net fee and commission income grew by 29.1% up to 1.756 bln rubles vs y-o-y 2007.
Operating income for 9 months reporting period reached 17.456 bln rubles, showing 40.7% growth vs y-o-y 2007.
In the reported period the Bank managed to show high growth rates of key balance sheet figures, mostly exceeding the average market levels. The assets grew by 16.7 % up to 419.7 bln rubles for 9 month period. The loan portfolio rose up to 292.2 bln rubles (by 30.7% since the beginning of the year). Meanwhile loans to corporate customers increased up to 208.0 bln rubles (by 28.7% vs the beginning of the year), loans to individuals - up to 84.2 bln rubles (by 36.0 % by 31.12.2007).
Customer accounts grew up significantly to 234.3 bln rubles as of 30.09.2008 (up 21.3% vs 31.12.2007). In particular, the volume of corporates' accounts increased to 161.7 bln rubles (30.4% up y-t-d) from the beginning of the year; individual accounts increased to 72.6 bln rubles (5.1% up y-t-d).
Under current conditions on the financial markets the Bank's dependence on volatile financial instruments remains at a reasonably low level. In particular, the equity securities volume in the securities portfolio for 9 month period decreased by 66.5% in absolute terms, and share of equity securities in the assets structure fell down to practically non-material 1.1%. The abovementioned facts indicate that the turbulence on the stock markets has an insignificant impact on the Bank's stability.
Despite all that, the disadvantageous market trend influenced the Bank's financial results in 3Q2008. Due to the balanced asset structure and high share of core banking income in the operating income, the Bank neutralized negative market factors and showed almost zero result (net loss of 89 mln rubles in 3Q2008). Negative financial results of 3Q2008 were caused by the losses from securities. At that the Bank reported on net gains from foreign currencies and precious metals in the amount of 0.765 bln rubles in 3Q2008 and 1.361 bln rubles for 9 months 2008.
The key task of the last reporting period for the management was the increase of the core banking income and expenses control. The core banking income/operating and administrative expenses ratio amounted to 154.0% for 9 months 2008.
The stringent staff and other non-operating expenses control during January-September 2008 allowed remaining Cost-to-Income (C/I) at 64.3%. Administrative expenses for 9 months 2008 was only 16% up vs y-o-y 2007.
Stable position of the Bank is confirmed by serious improvement of current liquidity ratios for the 9 month period. Current liquidity ratio (H2) as of the end of 3Q2008 amounted to 50.6% (regulatory norm min 15%), instant liquidity ratio (H3) reached 77.1% (regulatory norm min 50%), long-term liquidity ratio (H4) - 82.1 % (regulatory norm max 120 %).
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