OREANDA-NEWS. September 30, 2011. B&N Bank has issued unaudited Condensed Interim Consolidated Financial Information for the 6 months ended June 30, 2011, reported the press-centre of B&N Bank.

For the accounting period B&N Bank (ranked Top-40 among Russian banks by total assets) demonstrated steady growth in its key financial figures. As of July 1, 2011 the Bank was ranked 36 th among ‘Top-200 Russian Banks by Net Assets’, 18 th among ‘Top Banks by Retail Deposits’ and 3 rd among ‘Top-100 Most Reliable Russian Banks’ according to business magazine ‘Profile’. Moreover, B&N Bank remains included in CBR Top-30 ranking for biggest Russian banks.

B&N Bank’s total assets, excluding assets directly associated with discontinuing operations of JSC “Vyatka-Bank”, increased by 6% and amounted to RUB 104.2 bn (RUB 98.7 bn as at the end of 2010). Asset growth is basically driven by increase in the loan book up to RUB 63 bn (+12%) and due from banks up to RUB 14.4 bn (+36%). Corporate loans, which constitute the fundamental component of the loan portfolio, have increased by 15% and amounted to RUB 56.9 bn. At the same time, retail loans decreased by 9% and totaled RUB 6.1 bn due to repayments on “old” loans and building of a “new” loan book since April 2011 after the temporary suspension of some retail lending programs in 2009-2010.  

Loan book quality has significantly improved since the beginning of 2011: as at July 1, 2011 NPL 90+ ratio (calculated as overdue payments plus the principal amount of the loan) declined to 5.32% of the total loan portfolio, in line with the average NPL ratio in Russian banking sector.     
In 1H2011 total liabilities of the Bank increased by 6% and amounted to RUB 99.2 bn (RUB 93.6 bn as at the end of 2010). Customer accounts increased up to RUB 87.3 bn (+4%). Retail deposits constitute the core source of funding showing progress from RUB 60 bn to RUB 64.9 bn (+8%).

Interest income of the Bank increased up to RUB 4.8 bn (+8%) as compared to RUB 4.5 bn in 1H2010. Due to decrease in interest expense by 6% net interest income (before provision for impairment losses on interest bearing assets) increased from RUB 1 bn to RUB 1.6 bn. Net non-interest income significantly increased by 82% and amounted to RUB 1.1 bn (RUB 587 mn as at June 30, 2010). Basically, this growth is triggered by fee and commission income amounted to RUB 840 mn against RUB 504 mn as at June 30, 2010 (+67%).

Net profit in 1H2011 amounted to RUB 109 mn against the loss of RUB 761 mn for the same period a year earlier. Earnings growth was driven by higher returns on core operations resulting from a larger net interest margin and increased commission income, as well as cuts in allowance for impairment losses. At the same time, provisioning level remains adequate to the Bank’s risks (provisioning rate is about 7%). 

In 1H2011 total capital adequacy ratio (CAR) reduced from 11.5% to 10.9% (Tier 1 capital – from 7.7% to 7.3%) in response to redemption of shares of JSC “Vyatka-Bank” (RUB 889 mn). In September 2011 the Bank’s share capital was increased by RUB 1.5 bn through the additional share issue. Capital increase will be reflected in the Bank’s financials for the 3 rd quarter of 2011. Next injection (about USD 50 mn) into the Bank’s capital is expected early in 2012 according to the Bank’s business strategy.      

Current liquidity reserves remain high. CBR prudential ratios governing liquidity are better than satisfied: N2 “Instant Liquidity” – 88.46% at min. 15%; N3 “Current Liquidity” – 113.57% at min. 50%; N4 “Long-Term Liquidity” – 73.63% at max. 120%.
 
As of July 1, 2011 the Bank’s branch network covered 34 regions of the Russian Federation and accounted for 123 offices: 30 branches, 84 sub-branches, 8 cash and operating offices and 1 representative office. In 1H2011 B&N Bank opened 3 new offices in Moscow, Moscow region and Novosibirsk.