Page 73 - RusRPTJun19

up and may need another $10bn in the next two to three years to complete the revamp, according to Fitch ratings agency.
8.1.8 Sberbank news
Russia's largest bank state-controlled Sberbank reported 1Q19 IFRS results which were about 7% ahead of the analyst consensus on RUB226.6bn ($3.5bn) net income (up by 7% year-on-year and 28% quarter- on-quarter), making a 23% Return on Equity (ROE). Sberbank is Russia's largest creditor and deposit holder.
As reported by bne IntelliNews, the bank is consistently tending as the most valuable Russian company. It is an investor’s darling because it is seen as a proxy for the whole Russian economy, but also an innovative bank and one of the largest players in the new digital economy. That said, the valuation of Sberbank remains well below what is should be thanks to sanctions and the perennial “Russia discount.”
For the first quarter of 2019 the results expected revealed still falling net interest income (NIM), but good fees and opex, BCS Global Markets commented on May 3. At the same time, the bank showed stable equity build- up with 78bp added to the CET1R capital requirement reaching 12.6%. While NIM was weaker than expectations (44bp and 25bp decline y/y and q/q), asset yield also stayed on a decline path with -20bp in corporate and -50bp in retail, BCS GM notes. However, fees and commissions remained on track and in line with consensus, posting 11% y/y growth to RUB104bn, with growth coming mostly from cards and clients FX operations. The bank's operational expenses inched by 4% y/y to RUB152bn in the first quarter, but declined by 27 q/q after a peak fourth quarter of 2018. Making a CIR of 31.9%, in line with expectations. Overall, results look neutral to BCS GM, which maintained a Buy recommendation for Sberbank shares at a target price of RUB330 per share.
Russia’s leading bank state-controlled Sberbank has published its April 2019 Russian Accounting Standards (RAS) results that showed the usual strong returns on equity, and a gain in the net interest margins (NIMs).
73 RUSSIA Country Report June 2019 www.intellinews.com