Vozrozhdenie Bank announced RAS results for Q1 2015

14 May 2015

Vozrozhdenie Bank has published its RAS results for Q1 2015.

Operating income before provisions for Q1 2015 reached RUB 4.0 billion, up by 9.1% compared to the same prior-year period on the back of growth of income from operations with financial assets and securities by RUB 338.6 million.

The bank recorded RUB 336.7 million of pre-tax profit for the three months of 2015, down by 12.1% YoY due to outpacing operating expenses growth. Net income came in at RUB 22.7 million, a decrease by 92.6% compared to Q1 2014 as a result of higher income tax payments.

As of April 1, 2015, the bank’s assets totalled RUB 213.8 billion, 5.4% down compared to January 1, 2015 and 3.4% up compared to April 1, 2014. The contraction in Q1 2015 was mostly driven by lower excessive liquidity in cash and equivalents and securities that were down by 45.5% and 23.3%, respectively, as well as lower volumes of FX-denominated assets due to Ruble strengthening during the reporting period. The largest share of 71.3% (up by 2.4 pps from the start of 2015) in the assets structure accounts for net loan indebtedness.

Loan portfolio before provisions* declined by 1.7% QoQ and totalled RUB 172.4 billion triggered by a number of factors affecting borrowers’ activity, including elevation of interest rates, drop of real disposable income and tighter credit policies. Corporate loan book contracted by 4.1% YoY and 1.5% YtD amounting to RUB 126.8 billion, while retail loans, including securitised mortgages, were up by 3.3% YoY and down by 2.3% YtD reaching RUB 45.6 billion (sector decrease was 3.4% for Q1 2015, according to the Bank of Russia data).

To comply with the Bank of Russia requirements and cover risks of assets impairment, the bank charged RUB 993.7 million to provisions in Q1 2015, 23.8% lower than for the same prior-year period.

Customer funds, key funding source, amounted to RUB 173.1 billion, up 15% compared to the level of Q1 2014. Major growth derived from retail funds that surged by 20.5% YoY to RUB 124.2 billion owing to inflow of new deposits outpacing sector growth by 5.2 pps (according to the Bank of Russia data). Dynamics of corporate client funds that came in at RUB 48.8 billion was mixed: +3.1% YoY and −2.6% YtD.

Capital of the bank remained flat during the quarter at RUB 26.1 billion according to Basel III standards. Driven by lower risk-weighted assets, the total regulatory capital adequacy ratio (N1.0 norm) grew to 12.2% (+0.2 pps YtD) as of April 1, 2015 while the minimum acceptable level is set at 10%. The common equity Tier1 capital adequacy ratio (N1.1 norm) added 1.2 pps over the same period and reached 10.5%, while the minimum requirement is 5%.

Please note that IFRS consolidated financial statements of Vozrozhdenie Bank for 3M 2015 will be published on May 27, 2015.

* Hereinafter loan and deposit portfolio figures are provided in accordance with internal reporting forms of Vozrozhdenie Bank.

Vozrozhdenie Bank will publish its Q1 2015 IFRS results and hold a conference call for investors on May 27
Vozrozhdenie Bank Board of Directors has held a regular meeting