REG - JSC Halyk Bank JSC Halyk Bank-37QB - Consolidated financial results for the FY 2024
27/03/2025 08:00
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RNS Number : 4707C JSC Halyk Bank 27 March 2025
27 March 2025
Joint Stock Company 'Halyk Bank of Kazakhstan'
Consolidated financial results
for the year ended 31 December 2024
Joint Stock Company 'Halyk Bank of Kazakhstan' and its subsidiaries (together
"the Bank") (LSE: HSBK; KASE: HSBK, HSBKd; AIX: HSBK, HSBK.Y) releases
consolidated financial statements and independent auditors' report for the
year ended 31 December 2024.
Consolidated Statement of Profit or Loss
KZT mln
12M 2024 12M 2023 Y-o-Y, abs Y-o-Y,% 4Q 2024 4Q 2023 Y-o-Y, abs Y-o-Y,%
Interest income(()(1)()) 2,170,786 1,669,782 501,004 30.0% 598,926 463,498 135,428 29.2%
Interest expense (1,062,876) (872,642) (190,234) 21.8% (282,701) (261,745) (20,956) 8.0%
Net interest income before credit loss expense 1,107,910 797,140 310,770 39.0% 316,225 201,753 114,472 56.7%
Fee and commission income 211,734 200,060 11,674 5.8% 58,166 49,533 8,633 17.4%
Fee and commission expense (86,450) (86,347) (103) 0.1% (22,007) (25,207) 3,200 (12.7%)
Fees and commissions, net 125,284 113,713 11,571 10.2% 36,159 24,326 11,833 48.6%
Net insurance income (()(2)()) 49,932 52,265 (2,333) (4.5%) 23,656 25,918 (2,262) (8.7%)
Net gain on foreign exchange operations, financial assets and liabilities((3)) 216,915 158,653 58,262 36.7% 67,880 56,142 11,738 20.9%
Other expense/non-interest income ((4)) (6,303) (1,490) (4,813) x4.2 21,432 (47,127) 68,559 (145.5%)
Expected credit loss expense and recovery of other credit loss expense (128,472) (89,102) (39,370) 44.2% (31,544) (18,309) (13,235) 72.3%
Operating expenses ((5)) (263,373) (216,405) (46,968) 21.7% (82,674) (62,257) (20,417) 32.8%
Income tax expense (180,902) (121,338) (59,564) 49.1% (68,958) (26,789) (42,169) 157.4%
Net income 920,991 693,436 227,555 32.8% 282,176 153,657 130,402 83.6%
Non-controlling interest 3 1 1 -
Net income attributable to common shareholders 920,988 693,435 227,553 32.8% 282,175 153,657 130,401 83.6%
Net interest margin, p.a. 7.2% 6.1% 7.5% 6.0%
Return on average equity, p.a. 34.0% 32.1% 37.5% 26.4%
Return on average assets, p.a. 5.5% 4.8% 6.3% 4.2%
Cost-to-income ratio 17.6% 19.2% 17.8% 23.5%
Cost of risk on loans to customers, p.a. 1.2% 1.0% 0.9% 0.7%
(1) Interest income calculated using the effective interest method
and other interest income;
(2) Insurance revenue less insurance service expense, financial
expenses from insurance contracts issued and net reinsurance expense;
(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,
loss from impairment of assets held for sales and other expense, net;
(5) Including reversal of impairment of non-financial assets;
Net income attributable to common shareholders for 12M 2024 is up 32.8%
year-on-year thanks to notable increase in lending and transactional
businesses.
Interest income((1)) for 12M 2024 was up 30.0% vs. 12M 2023 mainly due to
increase in average rate and balances of loans to customers.
Interest expense for 12M 2024 increased by 21.8% vs. 12M 2023 mainly as a
result of the increase in average rate on amounts due to customers, as well as
the growth in the share of KZT amounts due to customers and in the share of
deposits in total liabilities.
Certain reclassifications have been made to the consolidated statement of
profit or loss for the year ended 31 December 2023 to conform with the
presentation of the statement for the year ended 31 December 2024, as the
current year presentation provides a better understanding of the Group's
financial performance.
The reclassification of fee and commission expenses for 2023 in the amount of
KZT 13,357 million includes the reclassification of deposit insurance
expenses. As these expenses are directly related to deposit expenses, the
Group's management decided to reclassify them as interest expenses.
Accordingly, a reclassification was also made in the consolidated statement of
cash flows for the year ended 31 December 2023.
All of the ratios were also recalculated accordingly. For more detailed
information please refer to Halyk Group's consolidated financial statements
and independent auditors' report for the year ended 31 December 2024, note
#4b.
In 12M 2024 net interest margin was affected by the increase in average rates
on both loans to customers and amounts due to customers. Furthermore, net
interest margin was positively impacted by the increase in the share of higher
yielding retail loans in total loan portfolio and share of loans to customers
in total interest earning assets, as well as increase in the share of KZT
interest-earning cash and cash equivalents. As a result, net interest margin
has grown to 7.2% p.a. for 12M 2024 compared to 6.1% p.a. for 12M 2023.
Despite the negative effect from transition to amortization of tariff packages
for legal entities starting from November 2023 and revision of some retail
tariffs in 2H of 2023, Fee and commission income in 12M 2024 vs. 12M 2023 was
up by 5.8% as a result of increased number of clients and ramp-up of clients'
transactional activity, as well as growth in fees on letters of credit and
guarantees issued.
Fee and commission expense in 12M 2024 vs. 12M 2023 stayed almost flat. The
increase in service fees on payment cards was offset by partial reimbursement
of expenses on loyalty program by international payment system. As a result,
the net fee and commission income for 12M 2024 increased by 10.2% vs. 12M
2023.
Other expense/non-interest income ((4)) in 12M 2024 was negatively impacted by
higher one-off recognized loss in a view of expected early repayment of the
deposit of KSF in accordance with the IFRS compared to the same impact in
2023.
Operating expenses((5)) for 12M 2024 increased by 21.7% vs. 12M 2023 mainly
due to the indexation of salaries and other employee benefits, including the
costs of the long-term incentive program.
The Bank's cost-to-income ratio decreased to 17.6% compared to 19.2% for 12M
2023 amid higher operating income for 12M 2024.
Cost of risk in 12M 2024 was at a normalized level as per our guidance at the
level of 1.2%.
Consolidated Statement of Financial Position
KZT mln
31-Dec-24 30-Sep-24 Change YTD, abs Change 31-Dec-23 Change YTD, abs Change YTD, %
Q-o-Q, %
Total assets 18,548,414 17,650,108 898,306 5.1% 15,494,368 3,054,046 19.7%
Cash and reserves((6)) 1,780,132 2,248,355 (468,223) (20.8%) 1,622,181 157,951 9.7%
Amounts due from credit institutions 156,966 144,704 12,262 8.5% 171,754 (14,788) (8.6%)
T-bills of MinFin & NBRK notes((7)) 2,738,432 2,784,832 (46,400) (1.7%) 2,125,941 612,491 28.8%
Other securities & derivatives((8)) 1,776,082 1,539,503 236,579 15.4% 1,614,666 161,416 10.0%
Gross loan portfolio 12,038,868 10,884,432 1,154,436 10.6% 9,774,798 2,264,070 23.2%
Allowance for expected credit losses (573,219) (556,743) (16,476) 3.0% (489,926) (83,293) 17.0%
Net loan portfolio 11,465,649 10,327,689 1,137,960 11.0% 9,284,872 2,180,777 23.5%
Assets classified as held for sale 8,833 11,480 (2,647) (23.1%) 111,542 (102,709) (92.1%)
Other assets 622,320 593,545 28,775 4.8% 563,412 58,908 10.5%
Total liabilities 15,480,365 14,770,832 709,533 4.8% 13,017,414 2,462,951 18.9%
Amounts due to customers, including: 12,990,043 11,974,486 1,015,558 8.5% 10,929,504 2,060,539 18.9%
individuals' deposits 7,200,363 6,543,795 656,568 10.0% 5,828,645 1,371,718 23.5%
term deposits 6,063,129 5,581,796 481,334 8.6% 4,808,592 1,254,537 26.1%
current accounts 1,137,234 961,999 175,234 18.2% 1,020,053 117,181 11.5%
legal entities' deposits 5,789,681 5,430,691 358,990 6.6% 5,100,859 688,822 13.5%
term deposits 3,811,441 3,500,441 311,000 8.9% 3,338,099 473,342 14.2%
current accounts 1,978,239 1,930,250 47,990 2.5% 1,762,760 215,479 12.2%
Debt securities issued 879,212 818,756 60,456 7.4% 653,393 225,819 34.6%
Amounts due to credit institutions 814,069 1,203,263 (389,194) (32.3%) 778,311 35,758 4.6%
Other liabilities 797,041 774,327 22,713 2.9% 656,206 140,835 21.5%
Total equity 3,068,049 2,879,276 188,773 6.6% 2,476,954 591,095 23.9%
(6) Cash and cash equivalents and obligatory reserves;
(7) Treasury bills of the Ministry of Finance of the Republic of
Kazakhstan and Notes of NBRK;
(8) 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
bills of the Ministry of Finance of the Republic of Kazakhstan and Notes of
NBRK;
As at end of 4Q 2024, total assets were up 19.7% year-to-date mainly due to
increase in amounts due to customers.
Compared with the YE of 2023, loans to customers were up 23.2% on a gross and
23.5% on a net basis. The increase in the gross loan portfolio was driven by
the growth across all business segments, with retail loans growing by 33.3%,
and the loan portfolio of legal entities increasing by18.4%.
As at the end of 4Q 2024, Stage 3 loans decreased from the level of 7.5% to
6.3% year-to-date as a result of workout of problem loans and loan portfolio
growth.
Compared with the YE 2023, the deposits of legal entities and the deposits of
individuals were up 13.5% and 23.5%, respectively, due to fund inflow from the
Bank's clients.
As at the-end of 4Q 2024, the share of KZT deposits in total deposits was
69.1% compared to 67.8% as at the YE 2023, in corporate deposits the share was
70.9% vs. 72.9% as at the YE 2023, while the share in total retail deposits
was 67.5% vs. 63.4% as at YE 2023.
Amounts due to credit institutions increased by 4.6% vs. the YE 2023, due to
increase in loans under REPO agreements and syndicated term loan for USD
300mln attracted by the Bank.
As at the end of 12M 2024, debt securities issued were up 34.6% 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 131.7bn 7.5% p.a. February 2025
Subordinated coupon bonds KZT 101.1bn 9.5% p.a. October 2025
Local bonds KZT 140.2bn 12.79% p.a. July 2031
Local bonds KZT 20.0bn TONIA+1.25% December 2027
Local bonds listed at Astana USD 190 mln 3.5% p.a. May 2025
International Exchange
Local bonds listed at Astana USD 298 mln 3.5% p.a. May 2025
International Exchange
Local bonds listed at Astana USD 423.5mln 3.5% p.a. July 2025
International Exchange
As at the end of 12M 2024, total equity of the Bank increased by 23.9%
compared to the YE 2023, mainly due to net profit earned by the Bank during
12M 2024, which was partially offset by the payment of dividends.
The Bank's capital adequacy ratios were as follows*:
31-Dec-24 30-Sep-24 30-Jun-24 31-Mar-24 31-Dec-23
Capital adequacy ratios, unconsolidated:
Halyk Bank
k1-1 19.6% 19.2% 17.6% 19.0% 19.6%
k1-2 19.6% 19.2% 17.6% 19.0% 19.6%
k2 19.7% 19.4% 17.7% 19.2% 19.9%
Capital adequacy ratios, consolidated:
CET 1 18.8% 19.0% 17.4% 19.5% 19.3%
Tier 1 capital 18.8% 19.0% 17.4% 19.5% 19.3%
Total capital 18.9% 19.1% 17.5% 19.7% 19.6%
* 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 consolidated financial statements and independent auditors' report for the
year ended 31 December 2024, including the notes attached thereto, are
available on Halyk Bank's website: http://halykbank.com/financial-results
(http://halykbank.com/financial-results) .
A 12M and 4Q 2024 results webcast will be hosted at 2:00pm London time/7:00pm
Almaty time (UTC +05:00) on Thursday, 27 March 2025. A live webcast of the
presentation can be accessed via Zoom link after the registration. The
registration is open until 27 March 2025 (including), for the registration
please click here.
(https://halykbank-kz.zoom.us/webinar/register/WN_FCtnTzW0TeumsPjsKrW_Qg)
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 December 2024, Halyk Bank had total assets amounting to KZT
18,548.4bn, 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 542 branches and service outlets across nationwide.
Additionally, the Bank operates in Georgia and Uzbekistan.
For more information on Halyk Bank, please visit https://www.halykbank.com
- ENDS-
For further information, please contact:
Halyk Bank
Mira Tiyanak +7 727 259 04 30
MiraK@halykbank.kz
Rustam Telish +7 727 330 15 66 RustamT3@halykbank.kz
Nurgul Mukhadi +7 727 330 16 77
NyrgylMy@halykbank.kz
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