REG - JSC Halyk Bank JSC Halyk Bank-37QB - Consolidated financial results for the 1Q 2026

Halyk Bank AOAnnouncement

18/05/2026 08:15

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RNS Number : 7026E  JSC Halyk Bank  18 May 2026

18 May 2026

 

Joint Stock Company 'Halyk Bank of Kazakhstan'

Consolidated financial results

for the three months ended 31 March 2026

 

Joint Stock Company 'Halyk Bank of Kazakhstan' and its subsidiaries (together
"the Bank") (LSE: HSBK; KASE: HSBK, HSBKd; AIX: HSBK, HSBK.Y) releases interim
consolidated financial information for the three months ended 31 March 2026.

 

 Consolidated Statement of Profit or Loss

KZT mln

 

                                                                                 1Q 2026    1Q 2025    Y-o-Y, abs  Y-o-Y,%
 Interest income(()(1)())                                                        721,112    629,197    91,915      14.6%
 Interest expense                                                                (387,743)  (303,331)  (84,412)    27.8%
 Net interest income before credit loss expense                                  333,369    325,866    7,503       2.3%
 Fee and commission income                                                       51,733     56,866     (5,133)     (9.0%)
 Fee and commission expense                                                      (26,771)   (23,088)   (3,683)     16.0%
 Fees and commissions, net                                                       24,962     33,778     (8,816)     (26.1%)
 Net insurance income (()(2)())                                                  8,185      15,458     (7,273)     (47.1%)
 Net gain on foreign exchange operations, financial assets and liabilities((3))  36,662     22,416     14,246      63.6%
 Other non-interest income ((4))                                                 5,711      20,616     (14,905)    (72.3%)
 Expected credit loss expense and recovery of other credit loss expense          (52,811)   (22,938)   (29,873)    130.2%
 Operating expenses ((5))                                                        (74,589)   (69,195)   (5,394)     7.8%
 Income tax expense                                                              (46,681)   (50,985)   4,304       (8.4%)
 Net  income                                                                     234,808    275,016    (40,208)    (14.6%)
 Non-controlling interest                                                        (1)        0          (1)         -
 Net income attributable to common shareholders                                  234,809    275,016    (40,207)    (14.6%)

 Net interest margin, p.a.                                                       7.0%       7.5%
 Return on average equity, p.a.                                                  25.9%      34.6%
 Return on average assets, p.a.                                                  4.5%       5.9%
 Cost-to-income ratio                                                            18.2%      16.5%
 Cost of risk on loans to customers, p.a.                                        1.5%       1.2%

 

 

(1)      Interest income calculated using the effective interest method
and other interest income;

(2)      Insurance revenue less insurance service expense, financial
expenses for insurance and net reinsurance service expenses;

(3)      Net gain on financial assets and liabilities at fair value
through profit or loss, net realised gain/(loss) from financial assets at fair
value through other comprehensive income, net foreign exchange gain;

(4)      Share in profit of associate, income on non-banking activities,
other income, net;

(5)      Including loss from impairment of non-financial assets;

 

 

The Group's performance in the first quarter of 2026 was in line with our
expectations and supports the full-year 2026 guidance communicated earlier.

 

Interest income((1)) for 1Q 2026 was up 14.6% vs. 1Q 2025 mainly due to
increase of average balances of loans to customers.

Interest expense for 1Q 2026 increased by 27.8% vs. 1Q 2025 mainly as a result
of the increase in average rate and balances of amounts due to customers, as
well as the growth in the share of KZT amounts due to customers. Consequently,
net interest income for 1Q 2026 grew by 2.3% vs. 1Q 2025.

Net interest margin decreased to 7.0% for 1Q 2026 compared to 7.5% for 1Q 2025
due to the introduction of new minimum reserve requirements coefficients. NIM
adjusted for the effect of tightened minimum reserve requirements would be
7.3%.

Net fee and commission income for 1Q 2026 decreased by 26.1% vs. 1Q 2025
mainly due to negative dynamics of BNPL transactional income amid tighter
underwriting resulting from regulatory changes, as well as the gradual
pass-through of VAT on certain banking services to clients.

The negative dynamics of other expense/non-interest income ((4)) in 1Q 2026
was driven by the base effect from one-off income booked in stress asset
management subsidiary of the Bank due to the work-out of certain assets and
liabilities in 1Q 2025.

Expected credit losses are in line with our full year guidance. Cost of risk
in 1Q 2026 was at normalized level of 1.5%.

Operating expenses((5)) for 1Q 2026 increased by 7.8% vs. 1Q 2025 mainly due
to IT development related costs and increase in VAT.

The Bank's cost-to-income ratio increased to 18.2% compared to 16.5% for 1Q
2025 amid higher operating expenses in 1Q 2026.

 

Net income attributable to common shareholders for 1Q 2026 is down 14.6%
year-on-year due to the impact of increased minimum reserve requirements and
tighter regulation in retail lending.

 

 

Consolidated Statement of Financial Position

KZT mln

                                             31-Mar-26       31-Dec-25       Change           Change

                                                                             Q-o-Q, abs       Q-o-Q, %
 Total assets                                21,195,608      20,908,456      287,152          1.4%
 Cash and cash equivalents                   2,015,785       1,694,431       321,354          19.0%
 Obligatory reserves                         826,334         862,148         (35,814)         (4.2%)
 Amounts due from credit institutions        192,392         181,288         11,104           6.1%
 T-bonds of MinFin & notes of NBRK((6))      3,119,902       2,502,059       617,843          24.7%
 Other securities & derivatives((7))         1,559,830       1,845,652       (285,822)        (15.5%)
 Gross loan portfolio                        13,410,654      13,714,721      (304,067)        (2.2%)
 Allowance for expected credit losses        (652,123)       (603,804)       (48,319)         8.0%
 Net loan portfolio                          12,758,531      13,110,917      (352,386)        (2.7%)
 Assets classified as held for sale          13,861          8,896           4,965            55.8%
 Other assets                                708,973         703,065         5,908            0.8%
 Total liabilities                           17,454,666      17,408,105      46,561           0.3%
 Amounts due to customers, including:        13,888,541      14,338,804      (450,263)        (3.1%)
 individuals' deposits                       7,892,911       7,976,450       (83,539)         (1.0%)
    term deposits                            6,860,953       6,781,175       79,778           1.2%
    current accounts                         1,031,958       1,195,275       (163,317)        (13.7%)
 legal entities' deposits                    5,995,630       6,362,353       (366,723)        (5.8%)
    term deposits                            4,151,256       4,675,777       (524,521)        (11.2%)
    current accounts                         1,844,374       1,686,576       157,798          9.4%
 Debt securities issued                      902,828         970,098         (67,270)         (6.9%)
 Amounts due to credit institutions          1,765,173       1,270,128       495,045          39.0%
 Other liabilities                           898,124         829,075         69,049           8.3%
 Total equity                                3,740,942       3,500,351       240,591          6.9%

 

(6)      Treasury bonds of the Ministry of Finance of the Republic of
Kazakhstan and Notes of NBRK;

(7)      Financial assets at fair value through profit or loss, financial
assets at fair value through other comprehensive income and debt securities at
amortized cost, net of allowance for expected credit losses less Treasury
bonds of the Ministry of Finance of the Republic of Kazakhstan and notes of
NBRK;

 

As at the end of 1Q 2026, total assets were up 1.4% year-to-date.

 

Year-on-year, loans to customers increased by 11.3% on a gross basis and by
11.5% on a net basis. Compared with the YE of 2025, loans to customers were
down 2.2% on a gross and 2.7% on a net basis, mainly due to seasonal effect
and appreciation of KZT, as well as tighter regulation in retail lending.

 

Stage 3 loans increased to 8.2% as at the end of 1Q 2026 year-to-date as a
result of continuing moratorium on the sale of problem retail loans to
collection agencies, as well as lower loan portfolio base.

 

On year-on-year basis, deposits of legal entities and the deposits of
individuals were up 3.0% and 10.4%.

Compared with the YE 2025, the deposits of legal entities and the deposits of
individuals were down 5.8% and 1.0%, partly due to FX effects from the
appreciation of KZT.

 

As at the end of 1Q 2026, the share of KZT deposits in total deposits was
72.4% compared to 71.7% as at the YE 2025, in corporate deposits the share was
71.8% vs. 70.4% as at the YE 2025, while the share in total retail deposits
was 72.9% vs. 72.7% as at YE 2025.

 

Amounts due to credit institutions increased by 39.0% vs. the YE 2025, due to
increase in loans under REPO agreements.

 

As at the end of 1Q 2026, debt securities issued were down 6.9% year-to-date,
and the Bank's debt securities portfolio was as follows:

 

 Description of the security   Nominal amount outstanding  Interest rate                Maturity Date

 Local bonds                   KZT 182.1bn                 14.85% p.a. - floating rate  July 2031
 Local bonds                   KZT 20.0bn                  17.83% p.a. - floating rate  December 2027
 Local bonds listed at Astana  USD  198.5 mln              3.5% p.a.                    May 2027

 International Exchange
 Local bonds listed at Astana  USD  285.4 mln              3.5% p.a.                    May 2027

 International Exchange
 Local bonds listed at Astana  USD  472.4 mln              3.5% p.a.                    May 2027

 International Exchange
 Local bonds listed at Astana  USD  495.3 mln              3.5% p.a.                    July 2027

 International Exchange

 

As at the end of 1Q 2026, total equity of the Bank increased by 6.9% compared
to the YE 2025, due to net profit earned by the Bank during 1Q 2026.

 

The Bank's capital adequacy ratios were as follows*:

 

       31-Mar-26  31-Dec-25  30-Sep-25  30-Jun-25  31-Mar-25
 Capital adequacy ratios, unconsolidated:
 Halyk Bank
 k1-1  21.0%      18.9%      18.0%      18.5%      19.8%
 k1-2  21.0%      18.9%      18.0%      18.5%      19.8%
 k2    21.0%      18.9%      18.0%      18.5%      19.8%

 

* The minimum regulatory capital adequacy requirements are 9.5%, for k1, 10.5%
for k1-2 and 12% for k2, including a conservation buffer of 3% and systemic
buffer of 1% for each.

 

The Interim condensed consolidated financial information for the three months
ended 31 March 2026, including the notes attached thereto, are available on
Halyk Bank's website:

https://halykbank.com/results-and-presentations
(https://halykbank.com/results-and-presentations) .

 

A 1Q 2026 results webcast will be hosted at 3:00pm London time/7:00pm Almaty
time (UTC +05:00) on Monday, 18 May 2026. A live webcast of the presentation
can be accessed via Zoom link after the registration. The registration is open
until 18 May 2026 (including), for the registration please click here.
(https://halykbank-kz.zoom.us/webinar/register/WN_45T_ZOnJRv6Up4OKucvqDw)

 

 

 

 

About Halyk Bank

 

Halyk Bank is the leading financial services group in Kazakhstan, with a
diversified presence across retail, SME, and corporate banking, as well as
insurance, leasing, brokerage, asset management and lifestyle services. Halyk
Bank has been listed on the Kazakhstan Stock Exchange since 1998, the London
Stock Exchange since 2006, and the Astana International Exchange since 2019.

As of 31 March 2026, Halyk Bank had total assets amounting to KZT 21,196bn,
making it the largest lender in Kazakhstan. The Bank boasts the country's one
of the largest customer base and the most extensive branch network, with 530
branches and service outlets across nationwide. Additionally, the Bank
operates in Georgia and Uzbekistan.

 

For more information on Halyk Bank, please visit https://halykbank.com/
(https://halykbank.com/)

 

- ENDS-

 

For further information, please contact:

 Halyk Bank

 Mira Tiyanak           +7 727 259 04 30

                        Ir@halykbank.kz

                        MiraK@halykbank.kz (mailto:MiraK@halykbank.kz)

 Rustam Telish          +7 727 330 15 66

                        RustamT3@halykbank.kz (mailto:RustamT3@halykbank.kz)

 Yekaterina Svanbayeva  +7 727 330 12 88

                        EkaterinaS@halykbank.kz (mailto:EkaterinaS@halykbank.kz)

 Laura Kustubayeva      +7 (727) 259 60 27

                        LauraKus@halykbank.kz (mailto:LauraKus@halykbank.kz)

 

 

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