Credit Bank of Moscow:
Key results
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CREDIT BANK OF MOSCOW’S 1H 2012 IFRS net income grew 15.8% compared to
1H 2011 and amounted to RUB 2,152 mln ($70.1 mln).
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The Bank’s assets rose 13.3% by the mid-year reaching RUB 263,231 mln
($7,882.5 mln).
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The loan portfolio expanded by 16.1% ytd to RUB 184,577 mln ($5,527.2
mln).
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The ratio of NPLs (loans overdue more than 90 days) was 1.2% of the
total portfolio.
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The Bank’s performance remains good with return on equity of 15.7%,
return on assets of 1.7% and cost-to-income ratio of 43.1% as of the
1H 2012. Net interest margin rose to 5.0% as of 1H 2012 compared to
4.8% as of 1H 2011.
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The Bank’s fee income in the 1H 2012 soared 53.0% yoy, reaching RUB
1,743 mln.
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The equity augmented by 14.2% ytd up to RUB 29,240 mln ($847.1 mln).
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The capital calculated under the Basel Accord increased 10.7% in 1H
2012 reaching RUB 32,625 mln ($977 mln), the capital adequacy ratio
being 13.9%.
The Bank’s net income reached RUB 2,152 mln in the reporting
period. The ROAE stood at 15.7% and the ROAA at 1.7%. As of end-2011,
ROAE and ROAA were 19.7% and 2.0%, respectively. The net income in 1H
2012 was mainly inhibited by the growth of operational expenses.
Net interest income grew 42.6% yoy to RUB 5,523 mln driven by the
return on the expanding loan portfolio, while the interest margin
increased to 5.0% as of 1H 2012 compared to 4.8% as of 1H 2012.
The Bank’s fee income soared by 53.0% compared to 1H 2011
reaching RUB 1,742.5 mln (25.3% of the bank’s operational income) of
which 25.7% is attributable to cash collection services and 23.2% to
each of settlement services, and issuance of guarantees and letters of
credit.
The Bank retains leading positions in cash collection. Apart from
servicing its own network and clients, CREDIT BANK OF MOSCOW also
provides cash collection services to other financial institutions and
their clients. In 1H 2012, the number of cash collection points rose by
1,063 and reached the total of 7,546. Thirty eight new collection
itineraries were put in place bringing their total number to 134.
Operational income increased by 34.7% compared to 1H 2011
reaching RUB 6,879.7 mln, and operational expenses in 1H 2012
amounted to RUB 2,963.7 mln which is 61.8% more than in 1H 2011. The
operational expenses rose, just like in 1Q 2012, due to growing
administrative expenses related to the infrastructural development and
due to greater staff costs. The latter reflect an increase in the staff
attributable to the network expansion and growing volumes of business.
As a result of these factors, operational performance in the 1 half of
2012 deteriorated as contrasted to the same period of 2011: CTI
(cost-to-income ratio) amounted to 43.1% against 35.9% in 1H 2011.
The assets grew by 13.3% ytd to RUB 263.2 bln. The
Interfax-100. Banks of Russia. Key performance indicators in 1H
2012 lists CREDIT BANK OF MOSCOW as number 21 by assets (same as in
the 1H 2011 ranking).
The Bank’s
loan portfolio after impairment provisions
expanded by 16.1% in the 6 months of 2012 and reached RUB 184.6 bln as
of the reporting date. The corporate loan portfolio grew to RUB 147.7
bln representing 80% of the total loan book, and the retail loan
portfolio to RUB 36.9 bln representing 20% of the total loan book.
Loan portfolio quality remains at a high level: the share of NPLs
(loans overdue more than 90 days) in the loan portfolio rose from 1.1%
as at the end-2011 to 1.2% as of the end of the reporting period. Ratio
of loss provisions to the loan portfolio stands invariably at 2.3% since
the beginning of the year. The percentage of overdue loans in the
portfolio increased insignificantly from 1.6% as at the last year-end to
1.8%.
In 1H 2012, the Bank remained active in trade and structured finance.
During this half-year, CREDIT BANK OF MOSCOW facilitated more than 270
transactions totalling $420 mln.
In May 2012, CREDIT BANK OF MOSCOW was awarded by the European Bank for
Reconstruction and Development (EBRD) as the "Most Active Issuing Bank
in Russia in short-term trade finance in 2011" under the Trade
Facilitation Program. In 2011 the Bank received a similar award.
The securities portfolio (trading and held-to-maturity
securities) that accounts for 9.2% of the Bank`s assets reached RUB 24.2
bln as of 1H 2012.
Retail accounts and deposits rose by 9.3% ytd to RUB 93.3 bln
(39.9% of the total liabilities). In particular, term deposits increased
by 8.1% to RUB 87.0 bln. Corporate deposits rose by 13.5% ytd to
RUB 69.6 bln (29.7% of the total liabilities).
The Bank ranked 16th in the Expert RA’s ranking by retail deposits as of
1 July 2012.
Liabilities. In April 2012, the Bank fully repaid its RUB 2 bln
3-year bond issue series 05, and successfully placed RUB 4 bln 3-year
exchange bonds series BO-03.
The Bank’s equity as calculated under the Basel Accord increased
10.7% ytd reaching RUB 32,625 mln and the capital adequacy ratio was
13.9% compared to 14.4% as of the last year.
An important subsequent event was the signing, in July 20, 2012, by the
European Bank for Reconstruction and Development (EBRD), International
Finance Corporation (IFC), CREDIT BANK OF MOSCOW and its shareholder of
agreements whereby EBRD and IFC purchased 15% of the Bank`s shares. An
additional issue of CREDIT BANK OF MOSCOW`s ordinary shares registered
by the Central Bank of Russia on May 15, 2012 was purchased by EBRD and
IFC for RUB 5.8bln in total, resulting in a 7.5% shareholding of each of
them in the Bank’s capital. The share of the current shareholder of
CREDIT BANK OF MOSCOW, ROSSIUM Concern, was reduced to 85%. This
investment will be shown in the Bank’s equity as soon as the Central
Bank of Russia registers the additional share issue closing report.
Pursuant to those agreements, EBRD and IFC become entitled to appoint
their representatives to the CREDIT BANK OF MOSCOW`s Supervisory Board.
In July 2012, The Banker published Top 1000 World Banks by Tier I
capital listing CREDIT BANK OF MOSCOW under number 724 as of 2011, which
is 98 points higher than last year and the most rapid growth of capital
in Central and Eastern Europe. Also, the Bank was ranked 145th in terms
of return on assets and 202nd in terms of return on equity. Out of the
thirty Russian banks listed, CREDIT BANK OF MOSCOW ranked 18th in terms
of equity, 12th in terms of ROE and 14th in terms of ROA.
The Bank’s infrastructural development. As of 1H 2012, CREDIT
BANK OF MOSCOW’s branch network included 61 offices in Moscow and the
Moscow Region.
The number of ATMs and payment terminals as of the reporting date
exceeded 630 and 4000, respectively. CREDIT BANK OF MOSCOW ranked 1st
bank in Moscow and 2nd in Russia by the number of proprietary
transaction & payment terminals and number 7 by the number of
proprietary ATMs in Moscow as of 1 January 2012 according to RBC Rating.
In 2Q 2012, the Bank continued to develop its remote service system and
fee generating lines of retail business. CREDIT BANK OF MOSCOW increased
its plastic card issuance by 13.6% ytd, bringing their total number in
IH 2012 to 686,000.
Ratings
The Bank’s strong positions in the Russian and international markets are
confirmed by the leading rating agencies:
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Standard & Poor’s – “Â+” long-term credit rating, “” short-term
credit rating, “ruA+” Russia national scale rating, stable outlook;
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Fitch Ratings – Issuer Default Rating of “ÂB-”, Short-Term IDR of “B”,
Viability Rating of “bb-”, Support Rating of “5”, National Long-Term
Rating of “A+ (rus)”, stable outlook;
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Moody’s – financial strength rating “B1”, long-term global & local
currency deposit rating at “Â1/NP”, long-term national scale credit
rating at “A2.ru”, stable outlook;
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RusRating – “”, national scale credit rating at “AA”, positive
outlook.
In June 2012, Fitch Ratings upgraded the Bank’s long-term rating from
“B+” to “BB-”, viability rating from “b+” to “bb-”, and national rating
from “A- (rus)” to “A+ (rus)”, having noted among positive factors the
Bank’s healthy liquidity, sound profitability, good fee generation
capacity, broadening of the Bank’s franchise in Moscow and Moscow region
as well as expectable improvement of the Bank’s corporate governance
following the equity injections from EBRD and IFC.
In the early July 2012, RusRating upgraded the outlook for the Bank’s
and its debt obligations’ ratings from “stable” to “positive” on the
back of the diversification of the Bank’s ownership structure.
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The Bank’s key financial results for 1H 2012
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Key financials
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1H 2012, RUB mln
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2011, RUB mln
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change, %
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Assets
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263,231
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232,371
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13.3
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Liabilities
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233,991
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206,763
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13.2
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Equity (Basel)
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32,625
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29,480
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10.7
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Loan portfolio (after provisions)
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184,577
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159,020
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16.1
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NPLs (loans overdue by more than 90 days)
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2,297
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1,765
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30.1
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1H 2012, RUB mln
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1H 2011, RUB mln
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change, %
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Net income
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2,152
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1,859
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15.8
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Net interest income (before provisions)
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5,523
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3,874
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42.6
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Fees and commissions income
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1,743
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1,139
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53.0
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Key financial ratios, %
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1H 2012
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2011
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1H 2011
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Capital adequacy ratio (CAR)
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13.9
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14.4
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15.2
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90+ NPL ratio (before provisions)
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1.2
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1.1
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0.9
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LLP / 90+ NPL ratio
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191.8
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208.6
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256.3
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Net interest margin (NIM)
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5.0
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5.0
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4.8
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Cost-to-income ratio (C/I ratio)
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43.1
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39.8
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35.9
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Return on equity (ROE)
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15.7
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19.7
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19.9
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Return on assets (ROA)
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1.7
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2.0
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2.0
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Background details
CREDIT BANK OF MOSCOW was founded in 1992. It holds general license No.
1978 issued by the Bank of Russia.
The Bank ranks 21st largest bank in Russia as of 1H 2012 (INTERFAX-100).
CREDIT BANK OF MOSCOW is a universal credit and financial organisation
providing the full range of banking services.
The Bank focuses on Moscow and the Moscow Region. The Bank’s branch
network comprises more than 70 branches, 600 ATMs and 4000 payment
terminals.
The Bank has been admitted to the Deposit Insurance System since 2004.
The holder of 85% of the shares in CREDIT BANK OF MOSCOW is “ROSSIUM
Concern”, LLC, the beneficial owner of this shareholding is Roman Avdeev.
15% of the shares are held in equal parts by the European Bank for
Reconstruction and Development and International Finance Corporation.
The said financial institutions’ shareholdings will be shown in the
Bank’s equity as soon as the Central Bank of Russia registers the
additional share issue closing report.
CONTACTS :
for Credit Bank of Moscow
Pavel Voronov, 797 42 22 ext. 6200
Director of International Business and Financial Institutions Division
voronov@mkb.ru
or
Elena Finashina, 797 42 22 ext. 6202
Head of Financial Institutions Department
finashina@mkb.ru
or
Anastasia Vasilchuk, 797 42 22 ext. 6217
Chief Manager of Investor Relations Unit
vasilchuk@mkb.ru
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