Page 66 - RusRPTMay19

8.1.4 Banks specific issues
Russia may need to spend another $10bn in the next two or three years to continue a banking sector clean-up, which has already required eight times as much, Fitch rating agency said on April 16. In 2017 alone, the Bank of Russia spent more than $40bn bailing out three major lenders.
8.1.5 Sberbank news
In the first quarter of this year, Sberbank earned RUB218.2bn net profit according to Russian accounting standards. This is 11.4% more than in January - March last year. At the same time, the net interest income of the state bank reduced by 0.8% to RUB299bn in comparison with the first quarter of 2018. The fall was in March, follows from the statements of Sberbank: in January - February, net interest income was the same as a year earlier. Interest income increased by 11.4%, while interest expense increased by 31.2%. The reason is the growth of the market value of the funds raised and their size, explained in the Sberbank message. During the quarter, the population’s funds decreased by 1.5% to RUB12.84 trillion, companies ’funds grew by 4% to RUB7.26 trillion. In real terms (taking into account the exclusion of currency revaluation) in March, deposits of individuals increased by 0.2%, legal deposits - by 0.1%, the bank press service specified to Vedomosti. Over the quarter, public funds in real terms declined by 0.3%, and legal entities increased by 7.2%. The outflow of funds of individuals in January is seasonal, it is emphasized in the response of Sberbank to the request of "Vedomosti".
Sberbank to pay dividend of 43% in 2018. The payout for 2018 may comprise 43% of net profit or RUB358bn (DPS RUB15.8/sh) that still implies 32% y/y DPS growth. The Supervisory Board on dividend recommendation will take place on 16 April. “The possible 43% payout implies RUB15.8/sh or 6.5% DY. The acquisition of 51% in Speech Technology Center from Gazprombank looks minor, but important deal in voice and facial biometrics developments,” said Elena Tsareva of BCS Global Markets in a note.
66 RUSSIA Country Report May 2019 www.intellinews.com