- WKN: A1JB8N
- ISIN: US80585Y3080
- Land: Russland
Nachricht vom 31.10.2019 | 08:27
Sberbank reports 3Q 2019 Net Profit of RUB230.8 bn under International Financial Reporting Standards (IFRS)
Sberbank reports 3Q 2019 financial results under International Financial Reporting Standards (IFRS)
Moscow, October 31, 2019 - Sberbank (hereafter "the Group") has released its interim condensed IFRS financial statements (hereafter "the Financial Statements") as at and for the 9 months ended 30 September 2019, with report on review by AO PricewaterhouseCoopers Audit. All information is presented net of Denizbank A.S. operations, unless stated otherwise.
Alexander Morozov, Deputy Chairman of the Executive Board, CFO, commented: «The Bank earned RUB230 bn net profit from continuing operations in 3Q 2019. Given the effect from the Denizbank sale the Group net profit was RUB156.1 bn. The deal resulted in a 123 bp increase in the CET 1 capital adequacy ratio. This quarter showed a turnaround in the corporate loan portfolio dynamics and substantial acceleration of net fee and commission income. It's also important to note the growth in frequency of usage of Sberbank's digital services through mobile application, thus the engagement increased to 41.4% DAU/MAU. The solid performance in all key strategic areas allows us to confirm our ROE guidance at the targeted level of over 20%."
The 3Q 2019 Financial Highlights:
Sberbank pays special attention to the growth of client engagement and quality of client experience. As a result, the number of active clients has increased significantly since the beginning of the year:
Selected Financial Results
* Total equity attributable to shareholders of the Bank / Total numbers of shares outstanding (ordinary + preferred)
** Net interest margin was recalculated as working assets adjusted for the amount of provisions, created against Stage 3 loans
*** Operating income before provisions for debt financial assets, credit related commitments and revaluation of loans at fair value due to change in credit quality
Selected Balance Sheet Results
* Before loan loss allowance and including loans at amortized cost and at fair value
Net interest income came at RUB353.9 bn in 3Q 2019, down by 1.5% y/y mainly due to an accelerated growth of interest expenses.
Interest income increased by 8.1% y/y to RUB602.6 bn in 3Q 2019 on the back of the gross loan portfolio (including loans at amortized cost and at fair value) expansion by 5.2% to RUB21.2 trn.
Interest expense, including deposit insurance expenses, was up by 25.4% y/y in 3Q 2019 to RUB248.7 bln.
In 3Q 2019 Sberbank Group placed bonds on the Russian market in the amount of RUB70 bn. At the end of 3Q 2019, the nominal volume of exchange-traded bonds, issued on the Russian market, amounted to RUB395.5 bn. The share of wholesale funding in total liabilities of the Bank is 1.2%.
Net LDR ratio equaled 88.7%, up by 60 bp compared to 2Q 2019.
The Group net fee and commission income for 3Q 2019 came at RUB130.0 bn, up by more than 15% from the year-ago period mainly driven by transactional business. The number of cities covered by transport acquiring services is growing and now exceeds 90. From 1 January 2019 VAT from loyalty programs is included into net fee and commission income, which was earlier recognized in operating expenses, the comparative base was adjusted as well.
According to management accounts, year-to-date operating income of insurance, pension and asset management businesses was up by 14% y/y and achieved RUB90 bln. Assets under management of the Wealth Management business increased by 15% from the beginning of the year and achieved RUB1.4 trn.
The Group operating expenses (staff and administrative) for 3Q 2019 grew by 7.9% as compared to the same period a year ago to RUB167.4 bn. The annual payroll indexation, happened in the reporting period which was carried out a quarter earlier than last year, as well VAT rate increase from the beginning of the year, affected the operating expenses dynamics. The Group Cost-to-Income ratio*** came at 32.8%.
Net credit loss allowance charge for loans at amortized costs amounted to RUB 31.8 bn for 3Q 2019. This translates into Cost of Risk at 63 bps for this loan book in 3Q 2019. According to IFRS 9 part of the loan portfolio is accounted at fair value through profit or loss. Negative revaluation of loans at fair value due to change in credit quality amounted to RUB23.4bn in 3Q 2019. The combined Cost of Risk for loans at amortized cost and at fair value in 3Q 2019 was 106 bp. Starting from 1Q19 we exclude FX-component from provision charge/ recovery for FX-denominated loans at amortized cost as well as from revaluation of FX-denominated loans at fair value. This FX component was shown as foreign exchange translation (losses) / gains and amounted to RUB 3.4 bn for the reporting period.
Total provision coverage of Stage 3 and POCI loans decreased in 3Q 2019 compared to the previous quarter by 2.6 pp and comprised 88.0%. The share of Stage 3 and POCI loans in total gross loans at amortized cost changed insignificantly, up by 0.1 pp to 7.9%.
(the data in the table is in accordance with standardized and IRB approaches applied to the corresponding assets groups)
The Group's total capital under Basel III reached RUB4 273.3 bn as of 30/09/2019, up by 6.7% as compared to previous quarter.
The Group's risk-weighted assets were down by 2.8% to RUB30 791.8 bn during 3Q 2019 mainly due to the Denizbank sale. The Group leverage ratio increased by 150 bp to 13.0% in 3Q 2019.
Starting from 3Q 2019 the Group synchronized calculation methodologies for risk-weighted assets in terms of the credit risk for IFRS capital adequacy ratio (Basel III) with the macro-prudential requirements of the Central Bank of Russia (CBR):
These changes reduced CET 1 capital adequacy ratio by 35 bp.
As a result, both common equity Tier 1 capital adequacy ratio and total capital adequacy ratio increased by 124 bp each to 13.53% and 13.88% correspondingly as of 30/09/2019.
i Including corresponding line from discontinued operations, that, effective May 2018, Denizbank is classified as
ii Other non-interest income / (expense) includes: Net gains from non-derivative financial instruments at fair value through profit or loss excluding revaluation of loans at FV through P&L due to change in credit quality; Net gains from financial instruments at fair value through other comprehensive income; Net gains / (losses) from derivatives, trading in foreign currencies, foreign exchange and precious metals accounts translation; Net gains on initial recognition of financial instruments and on loans restructuring; Impairment of non-financial assets; Net recovery of / (charge for) other provisions; Revenue of non-banking business activities; Cost of sales and other expenses of non-banking business activities; Net premiums from insurance and pension fund operations; Net claims related to insurance and pension fund operations; Income from operating lease of equipment; Expenses related to equipment leased out; Other net operating income
iii Active clients are calculated using the new revised methodology
This document has been prepared by Sberbank of Russia (the "Bank") and has not been independently verified. This press release does not constitute or form part or all of, and should not be construed as, any offer of, or any invitation to sell or issue, or any solicitation of any offer to purchase, subscribe for, underwrite or otherwise acquire, or a recommendation regarding, any shares or other securities representing shares in, or any other securities of the Bank, or any member of the Bank's group, nor shall it or any part of it nor the fact of its presentation or distribution form the basis of, or be relied on in connection with, any contract or any commitment whatsoever or any investment decision. The information in this press release is confidential and is being provided to you solely for your information and may not be reproduced, retransmitted or further distributed to any other person or published, in whole or in part, for any purpose.
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Document title: EN_Sberbank Financial Statements IFRS 3Q2019
|ISIN:||US80585Y3080, RU0009029540, RU0009029557, US80585Y4070|
|OAM Categories:||2.2. Inside information|
|EQS News ID:||901499|
|End of Announcement||EQS News Service|
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