OREANDA-NEWS. September 09, 2013. The Alfa Banking Group, which includes Alfa-Bank and its subsidiaries, reported IFRS financial results for the first half 2013.

Net profit of the Alfa Banking Group for the period amounted to USD 479 million (1H 2012 — USD 544 million), representing a 22.1% return on average equity. At the same time operating profit before provisioning increased by 43.2% to USD 1 455 million (1H 2012 — USD 1 016 million). Total equity increased by 8.6% to USD 4.5 billion. The Alfa Banking Group maintained a high capital adequacy ratio of 16.3%, mostly due to a solid growth of retained earnings in the period ended June 30, 2013 (December 31, 2012 — 15.6%).

In the reporting period the Alfa Banking Group recorded a slight decrease of its total assets of 1.1% to USD 45.4 billion at June 30, 2013 from USD 45.9 billion at December 31, 2012. As at June 30, 2013, total gross corporate loans increased by 2.8% to USD 27.9 billion (USD 27.2 billion as at December 31, 2012), while total gross loans to individuals increased by 9.2% to USD 5.1 billion (USD 4.6 billion as at December 31, 2012). Loan loss provisions remained stable at USD 1.3 billion or 3.9% of gross loan portfolio. Overdue loans (by one and more days) amounted to USD 651 million or 2.0% of gross loans as at June 30, 2013. Overdue loans are covered by loan loss provisions by 196% as at June 30, 2013.

Funding structure of the Alfa Banking Group remained stable, with corporate customer accounts, retail customer accounts and wholesale funding (including interbank) each accounting for approximately one third of total liabilities. In February 2013 the Group issued RR 5 000 million (equivalent of USD 165 million) bonds with 36 months maturity and interest rate of 8.65% p.a. In April 2013 the Alfa Banking Group placed its debut RR 10 000 million (equivalent of USD 319 million) Loan Participation Notes with 36 months maturity and interest rate of 8.63% p.a. In June 2013, USD 400 million Medium Term Notes were redeemed according to the repayment schedule.

At June 30, 2013, the Alfa Banking Group held approximately 10% of its total assets in cash and cash equivalents. Furthermore, the Alfa Banking Group has an investment portfolio of highly liquid debt securities available for sale in the amount of USD 1.3 billion, and has access to secured and unsecured borrowing facilities provided by the Central Bank of Russia.

The Alfa Banking Group has maintained its position as the top Russian private bank by total assets, total equity, customer accounts and loan portfolio. Market share by retail demand accounts is constantly growing and stood at 7.0% as at 30 June, 2013 according to management computation and CBR statistics.

In July 2013, Fitch Ratings confirmed the long term credit rating of Alfa-Bank at BBB-, stable outlook. Alfa-Bank is the only privately owned Russian bank with an investment grade rating assigned by one of the leading international rating agencies. In December 2012, Standard & Poor’s upgraded the long-term credit rating of Alfa-Bank to BB+, stable outlook. In April 2013, Moody’s confirmed their rating at Ba1 with a stable outlook.

The Alfa Banking Group’s first half 2013 IFRS figures have been reviewed by PricewaterhouseCoopers.