OREANDA-NEWS. October 11, 2012. Please note that the numbers are calculated in accordance with Sberbank’s internal methodology.

Income Statement Highlights for 9M 2012 (as compared to 9M 2011):
Net interest income grew 25.8% y-o-y
Net fee and commission income grew 17.1% y-o-y
Operating income before total provisions increased by 20.7% y-o-y
Total provision charge was RUB40 bn vs. provision release of RUB3 bn for 9M 2011
Operating expenses were up by 22.6% y-o-y
Profit before tax amounted to RUB337 bn vs. RUB318 bn for 9M 2011
Net profit totaled RUB269 bn vs. RUB254 bn for 9M 2011

Net interest income grew 25.8% y-o-y for 9M 2012:

Interest income increased by RUB185 bn due to growth of corporate and retail lending;

Interest expenses increased by RUB89 bn, in comparison with the same period last year, owing to increased fund-raising and higher interest rates on corporate funds and interbank market.

Net fee and commission income grew by RUB21 bn, or 17.1% y-o-y, due to expansion of fee-generating services with fees from plastic cards  and acquiring services being the largest contributor (RUB15 bn for 9M 2012).

Net gains from operations on financial markets amounted to RUB18 bn for 9M 2012, driven by gains from conversion operations.

For the reporting period, the Bank continued to make provisions, with those allocated for against loan portfolio amounting to RUB16 bn. Total provision charge for 9M 2012 amounted to RUB40 bn.

Operating expenses increased by 22.6% y-o-y for 9M 2012. The main drivers of the increase were planned expenses related to investments, and spending, associated with the realization of the Bank’s Strategic Transformation Plan. Cost-to-income ratio remained at 41%.

Profit before tax totaled RUB337 bn and net profit amounted to RUB269 bn for 9M 2012. Both figures exceeded those for the same period a year ago.

The Bank’s assets expanded by 17.7%, to reach RUB12.3 trln.

In spite of continued growth of the loan portfolio, assets shrank marginally in September (by 0.5%) reflecting ruble strengthening against the main foreign currencies in late September and the Bank’s short-term liquidity management.

The Bank lent about RUB 570 bn to corporate clients in September and over RUB4.0 trln YTD, which was 1.15 times more than that for 9M 2011. Corporate loan portfolio increased by 0.7% in September to RUB7.1 trln. The balance of the portfolio was negatively affected by foreign currency revaluation.

Retail customers were granted about RUB150 bn in September, or more than RUB1.4 trln YTD (1.8 times that for 9M 2011). Retail loan portfolio added 2.2% in September to reach RUB2.4 trln, driven by consumer lending.

Quality of the loan portfolio remained almost unchanged in September, with portion of the overdue loans in the total loan portfolio holding at 3.0%. Coverage ratio remained strong, with loan-loss provisions at RUB631 bn, or 2.2 times the overdue loans, as of October 1, 2012.

Securities portfolio decreased marginally (-1.0%) to RUB1.6 trln mainly due to expiration of some OFZ bonds and revaluation.

Retail deposits and accounts decreased by 0.1% in September, partially reflecting a negative revaluation of deposits denominated in foreign currencies. In the meantime, saving certificates grew by 27% for the month.

The outstanding balance of retail funds, which remain the key source of funding for the Bank, increased by 7.9% or by RUB0.4 trln YTD to RUB6.1 trln.

Corporate deposits and accounts increased by 2.4% in September, led by term deposits. As of October 1, 2012, the balance of corporate deposits and accounts exceeded RUB2.7 trln, up 25.4%, or by RUB0.6 trln YTD.

Regulatory capital (under CBR regulation No. 215-P) reduced by RUB81 bn in September to RUB1,547 bn. Capital adequacy ratio was at 12.1% as of October 1, 2012. The decline was related to the acquisition of DenizBank. Earnings growth remains the key source of capital generation.