OREANDA-NEWS. October 13, 2011. Gazprombank (Open Joint-Stock Company) issued consolidated IFRS financial statements for the six months ended 30 June 2011 (1H2011). Some of the major financial indicators are presented below.

Billions of Rubles

 

30 June 2011

31 December 2010

Change

Total assets

1,985.8

1,951.6

+1.8%

Equity

243.6

221.9

+9.8%

Corporate loans, gross

962.0

988.2

-2.7%

Retail loans, gross

113.8

95.8

+18.8%

Investments in securities

272.3

233.6

+16.6%

Corporate accounts and deposits

983.7

947.0

+3.9%

Retail accounts and deposits

259.9

238.4

+9.0%

Eurobonds and local debt issued

149.9

145.3

+3.2%

Subordinated deposits

133.7

143.4

-6.8%

 

 

 

 

Total capital adequacy (Basel I)

17.3%

16.8%

+0.5 pp

Tier 1 capital adequacy (Basel I)

11.4%

10.6%

+0.8 pp

Non-performing loans to gross loans

1.9%

2.1%

-0.2 pp

Impairment provision to gross loans

4.9%

4.7%

+0.2 pp

 

 

 

 

 

1H2011

1H2010

Change

Net profit

38.1

32.7

+16.7%

ROAE (return on average equity)*

32.3%

30.4%

 

ROAA (return on average assets)*

3.8%

3.7%

 

Net interest margin*

3.6%

1.9%

 

Cost to income*

27.1%

31.8%

 

* for the six months annualized

Profit and capital adequacy

Net profit of Gazprombank Group for the six months ended 30 June 2011 was RUR 38.1 billion compared to RUR 32.7 billion for the 1st half of 2010. Return on equity for the six months of 2011 was 32.3%, return on assets – 3.8%.

The Group’s equity increased by 9.8% to RUR 244 billion compared to year-end 2010 due to retained profit for the period. Capital adequacy ratio according to Basel I stood at 17.3% as of 30 June 2011 compared to 16.8% at year-end 2010, while Tier 1 ratio equaled to 11.4% versus 10.6% in 2010.

Gazprombank’s asset quality

During 1H2011 non-performing loans (90+ days overdue, before provision for impairment) decreased in absolute terms as well as percentage-wise and equaled 1.9% of gross loans compared to 2.1% at year-end 2010.

As of 30 June 2011 loan loss provisions were 4.9% of gross loans compared to 4.7% as of year-end 2010. As of 30 June 2011 non-performing loans were covered by impairment provision by over 2.5 times.

Loan impairment expense in 1H2011 in the amount of RUR 2.9 billion was driven by the growth of retail lending and by minor changes in the structure of corporate loans portfolio in respect of acquisition finance lending.

Development of core banking business

In 1H2011 Gazprombank’s assets grew by 1.8%. The overall volume of lending operations stood at the year-end 2010 level: as of 30 June 2011 the gross loan portfolio of Gazprombank Group was RUR 1,076 billion. Corporate loan portfolio continues to represent loans to the largest enterprises in strategic sectors of the national economy and did not demonstrate significant structural changes since the year-end 2010. Retail lending grew substantially in 1H2011: from RUR 96 billion as of the year-end 2010 to RUR 114 billion as of 30 June 2011 (an 18.8% growth). The major part of retail lending is still represented by mortgages comprising 69.2% as of the end of 1H2011.

In the six months ended 30 June 2011 securities portfolio increased by 16.6% to RUR 272 billion mainly due to the increase of investments into Russian corporate bonds and domestic government bonds. Fixed income instruments represent a 77% share of the total securities portfolio.

The share of customer funds in total liabilities grew from 68.5% as of the year-end 2010 to 71.4% as of 30 June 2011. Corporate deposits grew by 3.9% compared to the year-end 2010 and reached RUR 984 billion; retail deposits increased by 9.0% to RUR 260 billion since the year-end 2010. As of 30 June 2010 gross loans to deposits ratio was 86.5% compared to 91.4% as of 31 December 2010.

Despite the continuing tendency of decreasing interest rates that started in 2010, normalized sustainable banking income from lending and fee-based businesses for the six months ended 30 June 2011 doubled compared to 1H2010 and reached RUR 32.5 billion. Net interest margin for 1H2011 was 3.6% compared to 1.9% for the comparable period of 2010. The major factors leading to improving net interest margin include a decrease in the cost of funding and changes in the structure of interest earning assets.

The financial performance of Gazprombank Group for the 1st half of 2011 is evidence to successful implementation of its strategy to consistently increase the share of sustainable banking profits in the total financial results of the Group.