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TCS HoldingAnnouncement

06/09/2014 18:27

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RNS Number : 6528M
TCS Group Holding PLC
17 July 2014 
 
Statement on TCS Bank's RAS Financial Highlights for H1 2014 
 
Moscow, Russia - 17 July 2014. TCS Group Holding PLC (TCS LI) (the "Group"),
including Tinkoff Credit Systems Bank ("TCS Bank"), Russia's leading provider
of online retail financial services, today announces TCS Bank's unaudited RAS
financial highlights for the first six months of 2014. 
 
Net income for the first six months increased by 5% y-o-y to RUB 2.5 bln.
Higher growth in revenue and net interest income was partially offset by
increased loan provisioning (partly due to new regulatory requirements and
partly due to increasing risk). 
 
It should be noted that the RAS net income figure is not a reliable indicator
of IFRS net income for the same period. There is a very low correlation
between financial results under the two reporting standards as a result of
significant accounting differences and therefore RAS figures should not be
used as the basis for conclusions on forthcoming IFRS results. 
 
The gross loan portfolio amounted to RUB 90.1 bln representing an increase of
30% y-o-y and of 10% year-to-date. The net loan portfolio amounted to RUB 71.3
bln and increased by 17% y-o-y and by 1% year-to-date. The short-term slowdown
in the growth of the gross loan portfolio in January-June 2014 was partly due
to a much stricter underwriting policy. The net loan portfolio constitutes 72%
of total assets (70% at 1 July 2013 and 67% at year-end 2013). 
 
Retail customer accounts increased by 35% y-o-y and have not changed since the
beginning of the year, remaining flat at RUB 41.6 bln. TCS Bank is currently
maintaining its retail deposit portfolio at a constant level by retaining
relatively low deposit rates and not soliciting new customer deposits through
advertising. The reason for this policy is that TCS Bank is over-liquid: The
CBR N2 ratio stands at 86.4% (minimum: 15%), and the CBR N3 ratio is 73.3%
(minimum: 50%). Retail customer accounts constitute 52% of total liabilities
(40% at 1 July 2013 and 44% at year-end 2013). 
 
Total assets increased by 14% y-o-y to RUB 99 bln. Most of this increase was
due to the growth of the loan portfolio. Compared to the beginning of the year
total assets decreased by 6% primarily due to the redemption of Eurobond (USD
175 mln) and two Euro-Commercial Papers (USD 75 and 50 mln). 
 
As of 26 March 2014, TCS Bank increased its share capital by RUB 5.3 bln after
the completion of the registration of IPO proceeds with the CBR. Together with
retained profits, these proceeds increased total capital (based on CBR Form
123) by 65% y-o-y and by 32% year-to-date to RUB 23.6 bln as of 1 July 2014.
The CBR N1 capital adequacy ratio increased to 19.54%. Both Core Capital
Adequacy Ratio (N1.1) and Main Capital Adequacy Ratio (N1.2) were 13.95%. 
 
Note on RAS results 
 
Please note that the figures in this press release are calculated in
accordance with TCS Bank's internal methodology which is available at:
http://static.tcsbank.ru/documents/eng/investor-relations/ras-methodology.pdf 
 
RAS results are not a reliable indicator of IFRS results due to significant
accounting differences that make a direct read-across from RAS to IFRS results
impossible. The main differences between RAS and IFRS are: 
 
•    Consolidated results under IFRS include a number of additional items and
results of its subsidiaries 
 
•    Accrual of expenses under IFRS 
 
•    Timing differences in accounting for restructured loans ('instalments')
and loans going through courts 
 
•    The effect from the revaluation of currency derivative instruments 
 
•    The effect of deferred income tax. 
 
For enquiries: 
 
 Tinkoff Credit Systems Bank Darya Ermolina, Head of PR + 7(495) 648 1000 (ext. 2009)d.ermolina@tcsbank.ru  Tinkoff Credit Systems Bank Peter Russell, IR Director +44 20 3691 2049ir@tcsbank.ru  
 FTI Consulting LondonLarisa Kogut-Millings +44 (0)20 3727 1364                                             FTI Consulting MoscowMaria Shiryaevskaya+7 495 795 06 23                              
 
 
About the Group 
 
TCS Group Holding PLC is an innovative provider of online retail financial
services operating in Russia through a high-tech branchless platform. In order
to support its branchless platform, the Group has also developed a "smart
courier" network covering almost 600 cities and towns in Russia which allows
next day delivery to many customers. 
 
Since its launch in 2007 by Mr. Oleg Tinkov, one of the best known Russian
entrepreneurs with a long track record of creating successful businesses, the
Group has grown into a leader in the Russian credit card market, with the
third largest credit card loan portfolio and a market share of 7.3% based on
non-delinquent receivables (according to Central Bank of Russia (CBR) data, as
of 1 April 2014). As of 1 June 2014, the Group has issued over 4.3 mln credit
cards. 
 
In addition to a market-leading credit card offering, the Group has developed
a successful online retail deposits programme. The Group's other innovative
lines of business include Tinkoff Online Insurance, which enables the Group to
underwrite and sell its own innovative online insurance products, and Tinkoff
Mobile Wallet, mobile payment solutions and financial services for Russian
consumers. 
 
As of 31 March 2014, the Group's total assets amounted to RUB 101.2 bn, net
loans and advances to customers stood at RUB 75 bn and customer accounts
(deposits) amounted to RUB 43.1 bn. In Q1 2014, the Group generated a net
profit of RUB 362.3 mln and net interest income of RUB 7.4 bn. 
 
The Group is well capitalised with its total capital ratio and Tier 1 capital
ratio of 22.3% and 17.3%, respectively, in accordance with Basel III
methodology. 
 
This information is provided by RNS
The company news service from the London Stock Exchange