OREANDA-NEWS. December 14, 2012. Gazprombank (Open Joint-Stock Company) issued consolidated IFRS financial statements for the nine months ended 30 September 2012. Key financial indicators of Gazprombank Group are presented below:

RUB bn

 

30.09.2012

31.12.2011

Change over 9M 2012

Assets

2 794,5

2 477,7

+12,8%

Equity

324,1

242,9

+33,4%

Corporate loans[1]

1 654,4

1 311,6

+26,1%

Retail loans [1]

188,6

142,7

+32,2%

Securities [2]

327,9

296,5

+10,6%

Corporate deposits

1 406,3

1 272,9

+10,5%

Retail deposits

297,9

266,5

+11,8%

Capital market borrowings [3]

314,8

211,1

+49,1%

Subordinated debt

58,3

133,6

-56,4%

 

 

9M2012

9M2011

Change 2012 / 2011

Net profit

20,1

34,8

-42,2%

Total comprehensive income

18,5

23,6

-21,9%

 

 

30.09.2012/9M2012

31.12.2011/12M 2011

Change

Total capital adequacy[4]

12,7%

14,6%

-1,9 pp

Tier I capital adequacy[4]

10,6%

9,6%

+1,0 pp

Non-performing loans to gross loans to customers[5]

1,2%

1,4%

-0,2 pp

Allowance for impairment to gross loans to customers

3,4%

4,0%

-0,6 pp

Loans1 to deposits ratio

108,1%

94,5%

+13,7 pp

Net interest margin[6] (NIM)

2,8%

3,6%

-0,8 pp

Profitability and capital adequacy

Gazprombank GroupЇs (the °Group±) net profit per IFRS financial statements for the third quarter of 2012 amounted to RUB 9.5bn, significantly increasing from RUB 10.6bn for the first six months of 2012. As a result, net profit for the nine months of 2012 has reached RUB 20.1bn. Net profit for the nine months of 2011 amounted to RUB 34.8bn which was driven primarily by sizeable revenues from the sale of equity investments, as well as by one-off commissions.

The Group demonstrates a stable level of net interest margin which for the nine months of 2012 remained at the same level as for the first half year of 2012 and amounted to 2.8%. The amount of interest and fee income, which represent core banking business, stood at RUB 50.7bn, or flat to the levels reported for the nine months of 2011.

Tier I capital adequacy ratio per Basel I was 10.6% at 30 September 2012 vs. 9.6% at the end of 2011. Total capital adequacy ratio was 12.7% at the end of the third quarter of 2012, which is substantially higher than the minimum 8% required by the Basle Accord.

These capital adequacy ratios were achieved both through capitalization of profit and through capital management transactions, which included the additional placement of common shares of GPB (OJSC) in June 2012 and 7-year subordinated bonds issue in May 2012, which contributed to Tier II capital. In addition, in October 2012 the Group successfully placed perpetual subordinated bonds in the amount of USD 1bn in order to further strengthen Tier II capital.

The reinforced capital base enabled the Group to substantially increase its lending operations in the second and third quarters of 2012, while keeping its capital adequacy ratios at comfortably high levels. As a result, the GroupЇs gross loan portfolio increased by 26.7% as of 30 September 2012, reaching RUB 1 843.0bn since the end of 2011.

Business growth

The share of net loans to customers in the GroupЇs total assets grew from 56.4% at the end of 2011 to 63.7% in September 2012. Gross corporate loan book posted growth of 26.1% since the end of 2011 to reach RUB 1 654.4bn, primarily driven by the increased volumes of commercial lending. Gross retail loans also grew from RUB 142.7bn at the end of 2011 to RUB 188.6bn increasing by 32.2%. The main drivers were growth of mortgages and consumer finance lending.

Corporate deposits totaled RUB 1 406.3bn as of 30 September 2012, up by 10.5% since the end of 2011. Retail deposits grew by 11.8% and reached RUB 297.9bn at the end of September 2012. Customer accounts continue to be the principal source of funding for the Group: their share in the funding base was 69.0% on 30 September 2012.

During the 9 months 2012 the Group increased the volume of borrowings from international and local debt capital markets, improving the maturity profile of liabilities and limiting interest rate risk of the Group.

Asset quality

Asset quality of the Group remains traditionally high. At the end of September 2012 non-performing loans (overdue 90 days or more) were 1.2% of gross loans, having declined by 20 bps over the nine months of 2012.

The allowance for impairment amounted to 3.4% of gross loans as of 30 September 2012 vs. 4.0% at the end of 2011 with the coverage ratio of non-performing loans by allowance for impairment amounting to 2.8 times.

°In the unstable external environment we prefer the high quality of the loan portfolio and prudent balance sheet structure, which implies a certain decrease in net interest margin compared to the previous year. At the same time, during the third quarter of 2012 the Bank has effectively doubled the net profit and built up necessary capital base for future development±, notes Mr. Alexander Sobol, Deputy Chairman of the Management Board of Gazprombank.

[1] gross amounts (before allowance for impairment)

[2] includes trading securities, investments available-for-sale, investments in associates and investments held-to-maturity

[3] includes bonds issued and syndicated loans

[4] according to BIS guidelines (Basel I)

[5] loans are regarded as °non-performing± if the loan has been in default as to payment of principal or interest for 90 days or more

[6] calculated as net interest income for the reporting period over the chronological average of the balances of interest earning assets as at the end of each three-month period included in the reporting period. Interest-earning assets include due from credit institutions, loans to customers and debt securities (all ЁC before allowances for impairment)