Sberbank releases 8M 2009 Financial Highlights (under RAS)

Sep 22, 2009

Please note that the numbers are calculated in accordance with Sberbank’s internal methodology approved in March 2009 as a part of internal accounting optimization and convergence with IFRS. Also note that the numbers as of 1 January 2009 include the effect of subsequent events.

September 22nd, 2009

Income Statement Highlights for 8 months 2009 (as compared to 8 months 2008)

  • Operating income before provisions grew by 32.3% y-o-y
  • Net interest income increased by 42.7% y-o-y
  • Net fee and commission income rose by 5.8% y-o-y
  • Operating expenses decreased by 4.4% y-o-y
  • Provision charge increased 7-fold y-o-y
  • Profit before tax amounted to RUB9.9 bn vs. RUB121.3 bn for 8 months of 2008
  • Net profit totaled RUB7.4 bn vs. RUB92.7 bn for 8 months of 2008 

The Bank’s balance sheet contracted by 0.9% ytd to RUB6,660 bn. Decline in liabilities was mainly attributable to decreased short-term funding raised from the Bank of Russia (CBR) and corporate accounts outflow. On the asset side, the respective contraction was mainly due to decreases of the cash account and amounts due from foreign banks along with a decline in the retail loan book.

Sberbank continued with active lending to the real sector of the economy, granting more than RUB2,550 bn in loans to Russian companies over the past 8 month (excluding loans restructured in 1H09 when new loan agreements were signed to replace loans in foreign currency with ruble-denominated loans to reduce the customers’ foreign currency exposure). For 8M09, the corporate loan portfolio expanded by 9.2% to RUB4,347 bn (starting from August 1st 2009, Sberbank records assignments with deferred payment (hereinafter referred to as “assignments’’) as a part of its corporate loan portfolio under internal methodology). To encourage lending activity, the Bank lowered rates on all foreign-currency loans and introduced a range of minimum lending rates depending on the borrower’s credit rating over June-July. The corporate loan portfolio grew 1.8% m-o-m in August with growth seen almost in all regions countrywide.

Retail lending remained weak amid sluggish consumer demand. Retail loan portfolio shrank by 6.8% ytd to RUB1,172 bn. However, signs of stabilization emerged: the retail loan book expanded in six regions and the overall book posted an immaterial decline of 0.1% m-o-m in August.

Prudent credit risk management enables the Bank to sustain high quality of its loan portfolio. As of September 1st 2009, overdue loans stood at 3.56% of the loan portfolio including assignments and comprised 3.60% of the portfolio net of assignments.

The Bank’s securities portfolio increased by 32.7% ytd to RUB650.4 bn, mainly due to the Bank’s purchases of corporate bonds which is a sort of corporate lending. The Bank added RUB132 bn in corporate bonds ytd, including RUB49 bn in August. Sberbank’s portfolio comprises bond issues from JSFC Sistema, OAO Gazprom, OAO Lukoil, OAO AIZK, JSC VTB, OJSC TNK-BP Holding, JSC VimpelCom, OAO AK Transneft, OAO Severstal, etc. Active purchases of corporate bonds led to respective shifts in the portfolio structure with the share of corporate bonds up from 17% at the start of the year to 33%, while government and sub-federal bonds decreased from 80% to 61% of total.

Retail deposits continued growing, up RUB275 bn ytd to RUB3,399 bn. This fully offset the outflows from corporate accounts, which decreased by RUB152 bn ytd to RUB1,648 bn. 

Sberbank’s regulatory capital (under CBR regulation No. 215-P) increased by 0.05% m-o-m in August and totaled RUB1,337 bn as of September 1st 2009. The Bank’s regulatory capital grew by 15.6% ytd. The capital adequacy ratio stood at 22.8% as of September 1st 2009.

Sberbank’s Financial Highlights for 8M 2009 (in accordance with Russian accounting standards; non-consolidated)