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Sberbank (SBER)
Sberbank: Sberbank releases Financial Highlights for 2017, excluding effect
of subsequent events (under RAS; non-consolidated)
15-Jan-2018 / 08:08 CET/CEST
Dissemination of a Regulatory Announcement that contains inside information
according to REGULATION (EU) No 596/2014 (MAR), transmitted by EQS Group.
The issuer / publisher is solely responsible for the content of this
announcement.
Sberbank releases Financial Highlights for 2017, excluding effect of
subsequent events (under RAS; non-consolidated)
Please note that the numbers are calculated in accordance with Sberbank's
internal methodology. Also note that the effect of subsequent events is
included in the numbers as of January 1, 2017 but excluded from the numbers
as of January 1, 2018.
_January 15, 2018 _
Key highlights for December:
? In December, the Bank earned RUB49.9 bn in net profit;
? Record loan volume issued: almost RUB1.8 trln to corporate clients and
over RUB270 bn to retail clients. For the year, the Bank granted RUB13.5
trln in loans, which was 27% more than in 2016;
? Operating expenses were down y/y in December. As a result, operating
expenses grew only 2.2% for the year, which was below inflation.
? Overdue debt declined by RUB15.8 bn in December, and the overdue loans
as percentage of total loan portfolio was down by 0.1 p.p. to 2.4%.
Deputy Chairman of Sberbank Alexander Morozov stated:
"In 2017, the Bank showed record loan issuances outperforming the market, as
well as growth in net fee and commission income. Furthermore, the Bank
achieved its efficiency target by keeping the increase in operating expenses
below inflation. As a result, Return on Assets reached 3.1%, while Return on
Equity - 21.9%."
Comments for 2017:
Net interest income increased by 7.7% to exceed RUB1.2 trln for the year.
The increase was largely driven throughout the year by declining interest
rates on client funds and the expansion of retail loan portfolio.
Net fee and commission income was up by 12.5% to RUB355 bn, which was mainly
due to growth in operations with bank cards (+25.4%) and bank insurance
(+22.7%).
Operating income before provisions increased by 19.4% for the year, thus
outpacing operating expenses by a significant margin of 17.2 p.p. The Bank
further enhanced its approach to spread certain costs more evenly throughout
the year. As a result, operating costs for December were down y/y. For the
full year, operating expenses increased by 2.2%, which was below the annual
inflation rate of 2.5%.
Excluding payroll costs, operating expenses fell 4.1% or RUB9.7 bn for the
year, as cost reduction measures implemented by the Bank took effect.
Cost-to-Income ratio improved enhanced by 5.4 p.p. to 32.1%, which was the
lowest ever under RAS for the Bank.
Provision charges totaled RUB6.9 bn in December and amounted to RUB287 bn
for 2017, which was 13.3% higher in comparison with 2016. As of January 1,
2018, loan-loss provisions were 2.6 times overdue loans.
Net profit before income tax came at RUB848 bn for 2017, while net profit,
excluding effect of subsequent events, totaled RUB674 bn. The Bank is now
accounting for events after the reporting date. The total impact of these
events is expected at the level of 2016.
Total assets increased by 2.6% in December, driven mainly by loans to retail
clients and banks, securities portfolio expansion as well as accumulation of
sufficient cash reserves for the period of seasonal holidays. As of January
1, 2018 assets amounted to RUB23.3 trln.
The Bank granted about RUB1.8 trln in loans to corporate clients in December
and RUB11.4 trln total for the year, which is 25% more than in 2016.
Corporate loan portfolio decreased by 0.9% in December due to early loan
repayments along with revaluation of FX loans. The outstanding balance
totaled RUB12.0 trln as of January 1, 2018.
Starting from the summer onwards, the Bank has been hitting new records of
loan issuances to retail clients. The last month of the year was the most
remarkable with loans granted exceeding RUB270 bn, achieving new historical
highs both in mortgages and consumer loans. Retail loan portfolio added 1.8%
in December. As of January 1, the outstanding balance reached RUB4.93 trln.
During the full year 2017 the Bank granted over RUB2.1 bn in loans to retail
clients, or 38% more than a year ago.
Regular work with problem loans helped the Bank to reduce its overdue
exposure by RUB15.8 bn in December. As a result, the share of overdue loans
as percentage of total portfolio reduced by 0.1 p.p. to 2.4%. The indicator
remains substantially lower than the sector average (8.5% excl. Sberbank as
of December 1, 2017).
Securities portfolio expanded by 2.8% to RUB2.53 trln, due to purchases of
Russian federal and sub-federal bonds. The portfolio increased by 22.5% in
2017 and was largely represented by government and corporate bonds.
Customer deposits and accounts increased in December by 0.5% to RUB5.64
trln. Retail deposits added RUB546 bn for the month, or 4.7%, to RUB12.1
trln, largely led by balances on bank card accounts. Overall for 2017,
client funds expanded by 5.4% to RUB17.8 trln and accounted for 89% of total
liabilities.
Common Equity Tier 1 and Tier 1 capital (equal since Sberbank does not have
instruments of additional capital) stood at RUB2,646 bn as of January 1,
2018 under preliminary calculations.
Total capital amounted to RUB3,688 bn for this date, with retained earnings
being the main source of capital increase in December.
Risk-weighted assets remained virtually unchanged in December and amounted
to RUB24.8 trln as of 1 January, 2018.
Capital adequacy ratios as of January 1, 2018 under preliminary calculations
were:
? N1.1 - 10.7% (minimum adequacy level, required by the Central Bank of
Russia at 4.5%)
? N1.2 - 10.7% (minimum adequacy level, required by the Central Bank of
Russia at 6.0%)
? N1.0 - 14.9% (minimum adequacy level, required by the Central Bank of
Russia at 8.0%).
Sberbank 2017 Financial Highlights (under RAS, non-consolidated, excluding
subsequent events)
ISIN: US80585Y3080, RU0009029540, RU0009029557, US80585Y4070
Category Code: MSCU
TIDM: SBER
LEI Code: 549300WE6TAF5EEWQS81
Sequence No.: 5106
End of Announcement EQS News Service
645257 15-Jan-2018
(END) Dow Jones Newswires
January 15, 2018 02:08 ET (07:08 GMT)
