Sberbank releases Financial Highlights for 11 months of 2020 (under RAS; non-consolidated)

Dec 07, 2020

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, 2020. Therefore, the numbers for 2019 have been recalculated to make them comparable.

Key highlights for November 2020:

  • The Bank earned RUB78.0 bn in net profit, ROE came in at 20.2% and ROA – at 2.9% annualized for the month.
  • Retail loan portfolio grew by 2.1%. Retail loan issuance amounted to more than RUB468 bn with over a half of that due to mortgages.
  • Corporate loan portfolio increased by 0.8%, excluding the effect of FX revaluation. This positive dynamic has been on track since the mid-year.   
  • Client funding increased by 1.0%, excluding the effect of FX revaluation.

Alexandra Buriko, CFO, stated:

“In November, Sber once again delivered a high return on equity at 20.2%, despite an overall slowdown in consumption. Sber’s annual “Green day” campaign this time engaged more than 7 mn clients and supported positive trends in lending and fee income formation. In the meantime, cost inflation remained as low as 3% yoy. The prime event of November was the presentation of Sber’s Strategy 2023, where we set out ambitious targets for building an integrated ecosystem of financial and non-financial products and services.”

  

Comments for 11M 2020:

Net interest income increased by 14.3% as compared to 11M 2019 and amounted to RUB1,311 bn. Net interest growth in November exceeded 15% yoy due to loan expansion and reduced allocations for deposit insurance. In the meantime, positive impact from lower cost of funding becomes less feasible on the back of ongoing repricing of the loan portfolio.

Net fee and commission income was up by 8.4% to RUB454.0 bn, due to increased income from settlement transactions and acquiring as well as income from client operations on financial markets. In November, fees income growth decelerated as consumption slowed down by and large due to the pandemic.

Operating expenses amounted to RUB550.9 bn for 11M 2020, up by 3.9% yoy. Cost growth slowed below inflation as a result of the pandemic-related efficiency enhancement program and the levelling of the comparable base after the payroll indexation that took place in July 2019. Cost-to-income ratio improved for 11M 2020 to 28.1% vs 32.0% a year ago.

Total gain from provision release and fair-value revaluation of loans amounted to RUB10.1 bn in November, as ruble strengthened against major currencies. For 11M 2020, the credit risk charge totaled RUB517.7 bn vs RUB113.7 bn a year ago, which owed to the COVID-19 related global distress. Loan coverage ratio remained intact at 2.2 times overdue loans.

Net profit before income tax for 11M 2020 came in at RUB889.2 bn, while net profit amounted to RUB719.1 bn.

Total assets increased to RUB33.4 trn, driven by loan portfolio expansion and increased balance of securities portfolio. Excluding the effect of FX revaluation, assets grew by 3.9% for the month.

The Bank issued RUB1.2 trn to corporate clients in November and RUB11.8 trn for 11M 2020. Corporate loan portfolio kept growing in November – up by 0.8% excluding the effect of FX revaluation to RUB15.4 trn.

Retail loan production kept high for a third month in a row and totaled RUB468 bn in November. The Bank issued over RUB3.8 trn in retail loans year to date, which exceeds the amount of last year by a quarter. Retail loan portfolio grew by 2.1% for the month and exceeded RUB8.4 trn. Growth mainly owed to mortgages, which were up by 2.7% for the month.

The share of overdues in the total loan portfolio remained stable: 3.24% as of the 1st of November and 3.23% as of the 1st of December.

Securities portfolio increased in November by 4.2% or by RUB0.2 trn, due to purchases of OFZs. As of the 1st of December, the outstanding balance of securities portfolio stood at RUB5.1 trn.

Client funding excluding the effect of FX revaluation grew by 1.0%: retail funding was up by 1.1% and corporate funding increased by 0.8%.

In November, the Bank issued RUB18 bn of exchange-traded bonds with a tenor of 3 years and a 5.55% coupon rate. The outstanding balance of exchange–traded bonds exceeded RUB523.5 bn.

Core Tier 1 and Tier 1 were barely changed in November and stood at RUB3,586 bn and RUB3,736 bn respectively. This year’s earnings are not included in calculation of the Core Tier 1 and Tier 1 capital, which will be done upon annual audit.

Total capital grew by 3.2% for the month to RUB4,683 bn mainly due to the earnings for the period.

Risk-weighted assets remained virtually unchanged in November and amounted to RUB31.5 trn as of the 1st of December, 2020.

Capital, RUB bn

1 Dec’20*

1 Nov’20

1 Dec'20*/

 1 Nov’20

1 Jan’20  

1 Dec'20*/

 1 Jan’20

Core Tier 1 capital N1.1

3,586

3,587

-0.01%

3,300

8.68%

Tier 1 capital N1.2

3,736

3,737

-0.01%

3,300

13.22%

Total capital N1.0

4,683

4,537

3.22%

4,568

2.53%

Capital adequacy ratios, %

Core Tier 1 capital N1.1, min 4.5%

11.40%

11.40%

0.00 pp

10.51%

0.89 pp

Tier 1 capital N1.2, min 6.0%

11.88%

11.88%

0.00 pp

10.51%

1.37 pp

Total capital N1.0, min 8.0%

14.87%

14.40%

0.46 pp

14.52%

0.35 pp

Risk-weighted assets, RUB bn

31,500

31,497

0.01%

31,470

0.10%

* preliminary calculations

Sberbank Financial Highlights for 11M 2020 (under RAS, non-consolidated)