SberBank releases Financial Highlights for 10 months of 2021 (under RAS, non-consolidated)

Nov 09, 2021

The numbers are calculated in accordance with SberBank`s internal methodology.

Please note that some minor changes became effective in SberBank’s internal methodology starting from January 1, 2021. Therefore, the numbers for 2020 have been recalculated to make them comparable.

Key highlights for October:

  • SberBank earned net profit of RUB109.2 bn.
  • ROE came in at 24.9%, and ROA was 3.5%.
  • Total loan portfolio grew by 1.9%, excluding the effect of FX revaluation: retail loans expanded by 2.1%, while corporate loans were up by 1.9%.
  • Retail client funding increased by 0.4%, excluding the effect of FX revaluation, and amounted to RUB16.3 trn.

Alexandra Buriko, CFO, stated:

“In October, demand for loans remained solid from both retail and corporate clients - total loan production amounted to Rub1.8 trn for the month. Corporate lending gathered pace and was up by almost 2% excluding the effect of FX revaluation. The retail loan portfolio added 2.1%, supported largely by the growing popularity of our digital services: 77% of all consumer loans and about one half of all mortgages were issued online. For the first 10 months of 2021, SberBank earned over RUB1 trn in net profit, and delivered an ROE of 25.4%.”

Comments for 10M 2021:

Net interest income amounted to RUB1,328.8 bn for 10M 2021, and were up by 12.0% from the level of a year ago, led by the loan portfolio expansion.

Net fee and commission income increased by 14.8% y/y to RUB471.8 bn. This growth was driven by transactions with banking cards, including acquiring, income from which was up by 29% y/y. The introduction of non-working days at the end of October had no noticeable impact on the transactional activity of our clients, unlike the previous similar periods.

Operating expenses were up by 11.0% as compared to 10M 2020, and amounted to RUB550.0 bn. Growth in operating expenses was impacted by the revision of employee salaries in July, as well as the calendarization of expenses in 2021. Cost-to-Income ratio came in at 28.4%.

Provision charge including fair-value revaluation totaled RUB95.3 bn for 10M 2021, which was 5.5 times less than the charge a year ago, when SberBank made significant provisions on the back of worsening macro environment and the pandemic constraints. In October 2021, the provision release amounted to RUB2.7 bn driven by Ruble strengthening against major currencies. The share of overdue loans in total loan portfolio remained at 2.3%.

Loan-loss provisions were 2.7 times the overdue loans.

Net profit before income tax for 10M 2021 amounted to RUB1,290.5 bn. Net profit increased 1.6 times, and amounted to RUB1,045.9 bn.

Total assets in October increased by 1.7%, excluding the effect of FX revaluation, to exceed RUB36.8 trn mainly from lending.

The total loan portfolio in October was up by 1.9%, excluding the effect of FX revaluation, to reach RUB26.5 trn.

The Bank issued RUB1.2 trn in loans to corporate clients in October, to reach RUB11.2 trn for 10M 2021. The portfolio was up by 1.9% in October, or 6.6% year to date, excluding the effect of FX revaluation. The portfolio was affected by the repayment of loans to state and municipal institutions on the back of the replacement of their debt with budget funding. Excluding this factor, the corporate loan book would have expanded by 9.6% for 10M 2021. The corporate loan portfolio was RUB16.2 trn as of November 1, 2021.

Loan production to retail clients in October was RUB527 bn, of which over RUB270 bn were mortgages, and over RUB240 bn were consumer unsecured loans. For 10M 2021, SberBank issued RUB4.7 trn of new loans, which was 1.4 times higher than a year ago. Different interesting own and state mortgage programs, and digital services of our housing platform Domclick, the monthly audience of which now is 16 mn users, enhance the availability of mortgages. Retail portfolio in October reached RUB10.3 trn, and was up by 2.1% for the month and by 21.5% year to date.

The securities portfolio was down by 1.4% to RUB5.1 trn in October, due to redemption of corporate bonds.

Retail client funding in October increased by 0.4%, excluding the effect of FX revaluation, to RUB16.3 trn, with inflows across all major currencies. The ending balances of the escrow accounts continued to grow, supported by high volumes of mortgage lending, and reached about RUB1.4 trn as of November 1, 2021.

Corporate client funding in October came down by 2.7%, excluding the effect of FX revaluation, to RUB8.1 trn.

Core Tier 1 and Tier 1 capital changed insignificantly in October to RUB3,822 bn and RUB3,972 bn, respectively.

Total capital increased by 0.14% in October to RUB5,032 bn, due to the net profit for the period and inclusion of subordinated bonds in the amount of RUB7.61 bn in Tier 2 capital starting from October 25th, as per CBR approval. Growth of total capital was restrained by rising OFZ yields and related revaluation of the fair-value securities portfolio through other comprehensive income.

CET1 and T1 capital ratios were 11.09% and 11.53%, respectively, as of November 1, 2021. The calculation of the ratios does not include the net profit earned during the period between January and October 2021 inclusively, until it is audited, as per the CBR Regulation 646-P on the methodology of determining the amount of capital adequacy of lending institutions (Basel III).

Risk-weighted assets* in October increased to RUB34.5 trn, mainly due to the loan portfolio growth.

Capital, RUB bn

1 Nov21*

1 Oct21

1 Nov21* / 1 Oct21

1 Jan21

1 Nov21* / 1 Jan21

Core Tier 1 capital N1.1

3 822

3 828

-0.16%

3 581

6.72%

Tier 1 capital N1.2

3 972

3 978

-0.16%

3 731

6.45%

Total capital N1.0

5 032

5 025

0.14%

4 661

7.97%

Capital adequacy ratios, %

Core Tier 1 capital N1.1, min 4.5%

11.09%

11.18%

-0.09 pp

11.19%

-0.10 pp

Tier 1 capital N1.2, min 6.0%

11.53%

11.62%

-0.09 pp

11.66%

-0.13 pp

Total capital N1.0, min 8.0%

14.59%

14.66%

-0.07 pp

14.54%

0.05 pp

Risk-weighted assets, RUB bn

34 493

34 267

0.66%

32 042

7.65%

* preliminary calculations

Sberbank Financial Highlights for 10 months 2021 (under RAS, non-consolidated)