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Otkritie Financial Corporation Banking Group Recorded Net Profit in the amount of RUB 3.6 billion in the first half of 2016

On 29 August 2016, the Supervisory Board of Bank Otkritie Financial Corporation approved its Interim Condensed Consolidated Financial Statements in accordance with International Financial Reporting Standards (IFRS) as at June 30, 2016 and for the six months ended 30 June 2016.

Financial Highlights of the Group in the first half of 2016

Net profit in the first half of 2016 amounted to RUB 3.6 billion (RUB 6.6 billion for 2015).

Return on Average Equity (ROAE) in the first half of 2016 amounted to 3.3% (3.4% for the full year of 2015).

Net interest income and net trading income were the key growth drivers for the Group’s operating income, accounting for 41.1% and 37.3% of total operating income, respectively.

Net interest income in the first half of 2016 amounted to RUB 17.9 billion (RUB 23.9 billion in the first half of 2015).

Net trading income in the first half of 2016 totaled RUB 16.2 billion (RUB 19.5 billion in the first half of 2015)1, including income from operations with foreign currencies in the amount of RUB 13.7 billion.

Net fee and commission income in the first half of 2016 amounted to RUB 5.9 billion (RUB 5.4 billion in the first half of 2015). The greater part of the Group’s net fee and commission income accounted for settlement transactions (RUB 3.9 billion), documentary operations (RUB 1.1 billion) and cash operations (RUB 0.5 billion).

Operating expenses in the first half of 2016 decreased by 1.7% as compared to the second half of 2015 and totaled RUB 22.3 billion. Payroll expenses accounted for 59.9% of the Group’s total operating expenses.

The Cost-Income Ratio (operating expenses to operating income before provision for impairment) stood at 51.2% (44.4% for 2015).

Balance Sheet Key Figures Dynamics

Otkritie Financial Corporation Banking Group’s total assets decreased by 8.2% and reached RUB 3,087.8 billion as at June 30, 2016 (a 1.0% decline excluding foreign currency revaluation).

In the first half of 2016, the Group’s net loan portfolio decreased by 11.5% (a 4.1% decline excluding foreign currency revaluation) and reached RUB 2,270.6 billion or 73.5% of the Group’s total assets as at June 30, 2016.

The loan loss provision (LLP) ratio stood at 4.1% as at June 30, 2016 (3.4% as at December 31, 2015). Cost of risk ratio amounted to 3.1% in 2015 (4.0% for 2015)2.

Investments in securities amounted to RUB 453.2 billion or 14.7% of the Group’s total assets as at June 30, 2016 (RUB 421.6 billion or 12.5% as at December 31, 2015).

The Group’s total liabilities reached RUB 2,870.0 billion as at June 30, 2016, down by 8.8% compared to 2015 year-end (a 3.1% decline excluding foreign currency revaluation).

The Group’s customer accounts totaled RUB 1,206.1 billion as at June 30, 2016, a 4.0% reduction compared with December 31, 2015 (a 1.4% decline excluding foreign currency revaluation). The share of term deposits and current accounts as a proportion of the total amount of customer funds stood at 81.3% and 18.7%, respectively.

The funds of corporate customers made up 39.9% of customer funds as at June 30, 2016, while the share of retail and small business segment amounted to 44.9% of customer accounts.

As at June 30, 2016, the loan to deposit ratio including promissory notes issued to clients stood at 96.7% (100.9% as at December 31, 2015)2

Total capital adequacy ratio stood at 16.4% as at June 30, 2016.

See interim consolidated financial statements as at June 30, 2016 at http://ir.open.ru/.

1 Including net gain from financial assets available for sale
2 Excluding repo transactions