Page 65 - RusRPTSept20

8.1.8 Sberbank news
The net profit of Russia’s biggest lender Sberbank fell 22.4% on the year to RUB403.1bn ($5.4bn) in January–July, as calculated under Russian Accounting Standards (RAS), the bank said on August 7. In July, the bank’s net profit fell 13.1% on the year to RUB65.6bn. Retail deposits with the bank rose 6.9% in January–July to RUB14.56 trillion as of August 1, while corporate deposits increased 7.4% to RUB7.14 trillion. In July, retail deposits grew 1.3% and corporate deposits fell 0.4%. Retail loans rose 5.9% in January–July to RUB7.668 trillion as of August 1, while corporate loans increased 8.1% to RUB14.41 trillion.
Sberbank 2Q20 IFRS show stronger than expected results on lower cost of risk (CoR). Strong results – Rb167bn net income, 40% and 20% beat consensus with 14% ROE, supported by CoR decline by 70bp q/q to 2.3%. Very solid CET1R of 14.78% with RWA decrease of 5.3% q/q, supportive for 50% payout for 2019 with SupBoard in late August. Besides, CFO stated in PR – view on 2H20 is cautiously optimistic, we wait for 2020G to be presented later for 2H20 expectations.
§ NIM expanded to 5.33% (+17bp q/q), helped by decreased cost of funding on the back of key rate cuts as well as DIA decrease. Yet, asset yield continued gradual decline -20bp in retail and -10bp in corporate yield, although supported by +1.9% q/q growth in mortgages and virtually 0% change in consumer and corporate loans up 1.8% adj on FX change.
§ Net F&C acme stronger vs expectations at Rb120bn – 11% / 5% beat to BCSe and cons-s, yet -5% q/q, affected by lockdown in April- May.
§ CoR improved from 3% in 1Q20 to 2.3% 2Q20 vs our expectations of flat CoR and 2.8% on cons-s. Asset quality showed some deterioration mostly on corporate side, yet Stage 3+POCI ratio deteriorated slightly by 0.1ppt to 7.5%. Decline of CoR could be a good read across for other banks. § OpEx came mostly inline with BCSe and 3% beat to cons-s with Rb172.4bn +2% q/q and y/y, given efficiency enhancement program pandemia-related with CIR down to 33.5%.
§ CAR ratio is the bright spot in results with CET1R improved to 14.78% +1.4ppt q/q, supported by stronger earnings and RWA decrease by 5.3% q/q. Note, RWA as of 30.06.2020 assessed according to B3.5 and on Basel III previously.
8.1.8 Bank news
VTB 2Q20 came short of BCSe with 76% miss, yet 2x beat to consensus
with RUB2.7bn net result in 2Q20 (-91% y/y; -94% q/q) just 0.6% ROE. The
main pressure remains on CoR and negative revaluations of investment
property as well as RUB19bn FX loss we attribute to open currency position
revaluation, yet fees were weakish in 2Q20. Good NIM and NII is the major
bright spot. We wait for 2020G, potentially provided at the conference call
today.
65 RUSSIA Country Report September 2020 www.intellinews.com