Tinkoff Credit Systems Bank’s 1Q IFRS net profit declined 65% y-
“Net profit was dampened by the formation of additional loan loss provisions in order to maintain the ratio between provisions and non-performing loans (NPL) at a conservative 1.6%," comments on the bank’s financial numbers said. In January — March 2014 the bank’s provisions against devaluation of the credit portfolio totaled Rub 12.5 bln vs. Rub 9.4 bln as of year-end. The bank had to compile additional provisions due to mounting risks in the Russian consumer lending sector, in particular, as the debt burden of several groups of Russian households increased.
The bank’s assets grew 2.2% to Rub 101.2 bin in 1Q, while the credit portfolio expanded 4.9% to Rub 87.5 bln. Moreover, by early April 2014 the financial institution also saw non-performing loans (overdue by more than 90 days) rise to 8.9% of the credit portfolio from 7% at the beginning of the year.
In the January — March quarter of 2014 Tinkoff Credit Systems Bank issued 278,000 credit cards, i.e. flat on the year. However, bank card operations grew 8% y-
As of the reporting date Oleg Tinkoff’s aggregate assets equaled Rub 80.3 bln, up 2.3% since the end of 2013. The lending institution’s tier 1 capital adequacy ratio (№ 1) rose 2.5% to 18.3% in January — March 2014 after the bank drew $175 mln in additional capital from the initial public offering (IPO).
