OREANDA-NEWS. December 01, 2009. Over the third quarter 2009, assets of VAB Bank reduced by 2.5% (12.5% for 9 months 2009) to USD 812.3 million. The Bank continued accumulating its impairment provisions (USD 48.5 million for 9 months 2009, USD 39.1 million of which are attributable to the impairment of interest earning assets), which put pressure on its profitability and resulted in USD 37.5 million net loss for 9 months 2009, reported the press-centre of VAB Bank.

Gross loan book increased by 1.5% over the third quarter 2009 (3.3% contraction from YE2008) to reach USD 781.4 million at 30 September 2009. The growth in portfolio over the third quarter 2009 was caused mainly by a 4.3% increase in corporate loans to USD 551.3 million. Retail loans contracted 4.5% over the same period to USD 230 million. Loan loss provisions continued to grow totaling USD 85.2 million at 30 September 2009 (USD 75.3 million as of 30 June 2009). Loan book coverage by loan loss provisions improved to 10.9% (6.1% at YE2008).

Amounts due to customers slowed down their decline pace to 4.8% QoQ in the third quarter (compared to 10.3% and 19.7% in Q2 and Q1 respectively) and made up USD 345.1 million as of 30 September 2009. By the end of Q3 2009, retail deposit portfolio totaled USD 209.0 million improving its share in the total deposit portfolio to 60.6% (57.6% at YE2008); corporate deposits totaled USD 136.1 million.

Net interest income totaled USD 31.6 million for 9 months 2009, which posts a contraction from USD 46.6 million for 9 months 2008. Net fee and commission income reduced to USD 8.6 million compared to USD 26.6 million for the respective period a year before.
The Bank maintained its total capital adequacy ratio at 16.8% as of 30 September 2009 (compared to 16% as of 31 December 2008), which is however undermined by the negative financial result. Total capital reached USD 107.4 million as of end Q3 2009 (USD 126.9 million at YE2008). Subordinated debt increased by USD 32.7 million for 9 months 2009 and totaled USD 53.0 million as of 30 September 2009.

“The nine months of 2009 have been challenging and, as expected, affected the Bank’s financial performance. We continue to focus our efforts on managing balance sheet to remain liquid and well capitalized and deal with distressed assets. We are revamping our internal systems and processes to emerge of the crisis sufficiently robust and ready for the intensified competition”, commented Peter Baron, VAB Bank CEO.