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structures connected to bank's founder Oleg Tinkov. The bank's net interest margin came slightly better at 22.5% given strong lending growth in the frist quarter, BCS Global Markets commented on May 14, with the net interest income being 5% ahead of BCS analysts forecast. However, fees showed a 14% miss with 16% growth in 1Q19. TCS also announced interim quarterly dividend per share (DPS) of $0.17 per share or about 30% of its payout and 3.5% dividend yield. "Given strong growth in lending +20% over 1Q19, TCS upgraded its guidance on net loan growth from about 40% to over 40%, the rest of 2019 being left unchanged.
TCS Group announced the decision to close down its mortgage brokerage platform. The platform was a great development in easing Russia’s tough mortgage process, offering a choice of banks for the clients. However, the limited number of mortgage players in Russia prevents this product’s proper development. TCS has another product tied to real estate – home equity loans – which is growing strongly.
Russian bank VTB is relocating business lines and bankers from its London unit to Frankfurt after losses from its London unit tripled amid sanctions and the looming cloud of Brexit, bne IntelliNews can exclusively reveal. The UK business of Russia's second-biggest bank saw its post-tax loss balloon to $63.9mn last year from $20.4mn for 2017, according to a filing made to UK Companies House late in April. The comprehensive 155-page filing shows that the bank slashed its London headcount by 55 bankers to 206 from 261 and outlined plans for further cuts, as well a new “strategic focus” to build “in parallel” a trading book capability at VTB’s operation in Frankfurt.
Russian "bad assets" bank Trust owns 24.98% of Belarus potash company Slavkali of Safmar Group of Russian tycoon Mikhail Gutseriev, RBC business portal reported on May 7. Reportedly the bank will get the stake in the company as collateral against previous credit obligations of Safmar. Slavkali has undertaken one of the largest investments in Belarus investing $2bn into a potash project based on the Starobinsky mine, to be completed in 2020-2022. The project is backed by a 20-year supplies contract to China and secured a $1.4bn loan from the China Development Bank. Trust Bank has been picked by the Central Bank of Russia (CBR) as the basis for the Bank of Non-Profile Assets (BNA), absorbing RUB2 trillion worth of assets from the major banking clean-up waged by the regulator, among it also the stake in Slavkali. Representatives of Safmar group told RBC daily that a buy-back option is held on Slavkali shares, which would be executed once the credit obligations are settled in due time. As reported by bne IntelliNews, Belarus remains dependent on the re-export of Russian petroleum products and potash for the bulk of its export revenue, but the Belarusian government has been working hard to diversify its exports.
Russia's Bank Saint Petersburg reported 30% year-on-year and 50% quarter-on-quarter to RUB1.3bn ($20mn), making a return of equity of 7% and coming 10% below the consensus expectations of analysts. The miss on net profit was mostly attributed to a trading loss of RUB0.6bn, BCS Global Markets commented on May 28. In the meantime net interest income gained 13% y/y to RUB5.7bn, with net interest margin at 3.7%, supported by 4.5% growth in retail lending. Fees and commission income gained 15% y/y to RUB5.7bn. All of the indicators came in line with the expectations. At the same time the bank managed to cut provisions for bad loans by 2% y/y, beating the consensus, and bringing the cost of risk to below 2% to 1.9%, back to the bank's guidance of 170-190bp. BCS GM noted that the interest margins of
75 RUSSIA Country Report June 2019 www.intellinews.com