JSC VTB Bank (VTBR)
VTB Group announces IFRS results for 1Q 2019
30-May-2019 / 09:26 CET/CEST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
VTB Group announces IFRS results for 1Q 2019
VTB Bank ("VTB" or "the Bank"), the parent company of VTB Group ("the
Group"), today publishes its Interim Condensed Consolidated Financial
Statements for the first three months ended 31 March 2019.
Andrey Kostin, VTB President and Chairman of the Management Board, said:
"With net profit of RUB 46.5 billion and ROE of 12% in Q1 2019, we remain
confident in our ability to deliver on our full year guidance. VTB's core
business remains strong: we brought staff costs and administrative expenses
down by 3.8% year-on-year, and our Retail business continues to outperform
the market both in loans and deposits, with VTB further strengthening its
market shares during the quarter.
"While we continue to deliver on the main targets of our 2017-2019 strategy,
VTB recently adopted its new strategy for 2019-2022, which entails a
significant transformative agenda that will ultimately make VTB more
profitable and better positioned to outpace the rapid changes taking place
in the industry landscape, enabling us to be the bank of choice for every
type of client."
FINANCIAL AND OPERATING HIGHLIGHTS
Income Statement
RUB billion 1Q 2019 1Q 2018 Change, %
Net interest income 104.2 116.3 (10.4%)
Net fee and commission income 21.6 21.9 (1.4%)
Operating income before provisions 137.0 152.6 (10.2%)
Provision charge* (15.2) (20.7) (26.6%)
Staff costs and administrative (60.7) (63.1) (3.8%)
expenses
Net profit 46.5 55.5 (16.2%)
*Includes provision charge for impairment of debt financial assets and
provision charge for impairment of other assets, credit related commitments
and legal claims.
? Net profit for 1Q 2019 decreased by 16.2% year-on-year to RUB 46.5
billion, primarily due to lower net interest income and a 22.2%
year-on-year decline in other operating income, which was partially
balanced by a decline in provision charges and improvements in staff costs
and administrative expenses.
? Net interest income was 10.4% lower year-on-year at RUB 104.2 in 1Q 2019
and the net interest margin declined by 90 bp year-on-year to 3.2% for 1Q
2019. Funding costs rose by 40 bps year-on-year to 5.3% for 1Q 2019,
contributing to a 24.7% year-on-year rise in interest expense (including
payments to deposit insurance system), while interest income rose at a
slower pace of 8.3% year-on-year as return on interest-earning assets
declined by 40 bps year-on-year to 8.3%.
? Net fee and commission income declined by 1.4% year-on-year to RUB 21.6
billion in 1Q 2019. Total fee and commission income rose by 8.4% to RUB
33.6 billion, while total fee and commission expense increased by 31.9% to
RUB 12.0 billion with a significant 36% year-on-year rise in commission
expenses on settlement transactions and trade finance to RUB 10.2 billion.
? The cost of risk was just 0.5% in 1Q 2019, down from 1.7% in 4Q 2018 and
1.6% for FY 2018. This sharp improvement in CoR was driven by a 26.6%
year-on-year drop in the provision charge for 1Q 2019, which amounted to
RUB 15.2 billion.
? The Group's costs to operating income before provisions ratio was 44.3%
in 1Q 2019, compared to 41.3% for 1Q 2018. Despite the higher ratio staff
costs and administrative expenses declined by 3.8% year-on-year in the
first quarter, to RUB 60.7 billion.
Statement of financial position
RUB billion 31-Mar-19 31-Dec-18 Change in 1Q 2019,
% or bp
Total assets 14,841.8 14,760.6 0.6%
Loans and advances to 11,291.5 11,427.1 (1.2%)
customers, including
pledged under
repurchase agreements
(gross), as reported
Gross loans to legal 8,125.5 8,438.6 (3.7%)
entities
Gross loans to 3,166.0 2,988.5 5.9%
individuals
Customer deposits 10,149.0 10,403.7 (2.4%)
Deposits from legal 5,582.2 5,995.8 (6.9%)
entities
Deposits from 4,566.8 4,407.9 3.6%
individuals
NPL ratio 5.8% 5.7% 10 bps
LDR ratio 104.0% 102.8% 120 bps
Tier 1 CAR 12.3% 12.0% 30 bps
Total CAR 13.7% 13.5% 20 bps
? In 1Q 2019 the Group's loan book declined by 1.2% to RUB 11,291.5
billion as 5.9% growth in gross loans to individuals was balanced by a
3.7% decline in gross loans to legal entities. The Group's market share in
Russia in corporate and retail lending stood at 18.5% and 18.4%,
respectively.
? The Group's NPL ratio was 5.8% of gross customer loans as of 31 March
2019, representing a 10 bps increase compared to 5.7% as of 31 December
2018. The allowance for loan impairment at the end of the first quarter
was 6.5% of the total loan book, compared to 6.4% as of 31 December 2018.
The NPL coverage ratio was unchanged during the first three months of the
year, remaining at 112.0% as of 31 March 2019.
? Customer deposits amounted to RUB 10,149.0 billion as of 31 March 2019,
declining by 2.4% during the quarter and bringing customer funding to 76%
of the Group's liabilities, while the loans-to-deposit ratio rose slightly
to 104.0% as of 31 March 2019, compared to 102.8% at the end of 2018.
? Deposits from legal entities contracted by 6.9% in 1Q 2019, while
deposits from individuals rose by 3.6%. The Group's market share in Russia
in corporate and retail funding stood at 19.4% and 14.8%, respectively.
? The Group continued to maintain a low reliance on wholesale funding,
with the share of debt securities issued in total liabilities at just 2.2%
as of 31 March 2019, compared to 2.0% as of 31 December 2018.
? VTB Capital continued its award-winning performance, being named by EMEA
Finance Magazine as the best local investment bank in Russia, best Russian
asset manager, best securitisation house in EMEA and best rouble bond
house, while VTB Capital Broker was also honoured as best broker in
Russia.
? VTB maintained solid capital levels during the first quarter, with the
Total and Tier 1 capital adequacy ratios amounting to 13.7% and 12.3%,
respectively as of 31 March 2019, compared to 13.5% and 12.0%,
respectively, as of 31 December 2018.
Attachment
Document title: 1Q 2019 IFRS Report
Document: http://n.eqs.com/c/fncls.ssp?u=FOSFJGHYOC [1]
ISIN: US46630Q2021
Category Code: MSCU
TIDM: VTBR
LEI Code: 253400V1H6ART1UQ0N98
Sequence No.: 8876
EQS News ID: 817553
End of Announcement EQS News Service
1: https://link.cockpit.eqs.com/cgi-bin/fncls.ssp?fn=redirect&url=944b07b315a06e8d017d80b69b25bb77&application_id=817553&site_id=vwd&application_name=news
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May 30, 2019 03:26 ET (07:26 GMT)
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