Page 67 - RusRPTJan22

non-financial business revenues is up to RUB200+bn and this number is to double in 2022-23. In 2022, the share of non-financial companies in total opex is to grow to 10%, from 6.6% in 9mo21, due to CAC. In Sber’s view, fourmn Sber Prime active subscribers improves the monthly frequency of service use 20-40%.
20+% ROE ambitions comes at a price. Sber got a boost from the higher rates environment, but apparently NIM peaked in 3Q21, with the 2022 guidance implying a 5-10bp contraction y/y, and a further 20bp loss in 2023 as rates fall. While the initial CoR guidance of 100-120bp always looked too conservative, the updated 80-90bp is in line with our expectations through the cycle, implying a risk-adjusted margins contraction in 2022, signalling that the bank is entering the late cycle stage. Non-financial revenue guidance was reiterated at a 2020-23F CAGR of 100+%. Still, opex is to increase at approximately a 15% CAGR, management expects, driven by CAC.
FY22 outlook. Management expects decent loan portfolio growth. RWA density is to increase to 91%, but management expects CAR to remain above 13% (target 12.5%), which secures the more than 50% DPR.
Bottom line. While Sber is caught in the vice of the rising capital burden of ecosystem assets and the Ministry of Finance’s focus on increasing dividends, that ironically helps to focus the group’s efforts on efficiency and capital allocation (including divestments and the IPO of ecosystem assets). And we left impressed with this refocus. While the geopolitical noise is unlikely to subside, the current levels offer an attractive entry point at 2022F P/BV of 0.97x and undemanding 2023F P/PPP of 3.3x.
Changes in 2021-23F forecasts. We have reviewed our forecasts in light of management’s 2022 targets. Our 2021-23F EPS assumptions are down 3-10% due to higher opex expectations.
Sberbank published its 11M21 RAS standalone accounts on December 7. Monthly net profit came in at RUB101.6bn (+30% y/y) in November, leading to net profit of RUB1.15bn for 11M21.
Monthly NII and net fee income were both up 14% y/y, with NII slightly moderating m/m in November. The growth in NII was driven by the respective 24% y/y and 8.7% y/y expansions in the retail and corporate loan books. NIM was flat y/y but down 25bps m/m, likely due to rising funding costs.
The provision charge was RUB13bn due to a weaker ruble in November. Cost of risk came in at 0.6% in November after a slight
67 RUSSIA Country Report January 2022 www.intellinews.com