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VTB Group announces IFRS results for 3Q 2020

·14-min read

JSC VTB Bank (VTBR)
09-Nov-2020 / 07:59 CET/CEST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.

VTB Group announces IFRS results for 3Q 2020

 

VTB Bank ("VTB" or "the Bank"), the parent company of VTB Group ("the Group"), today publishes its Interim Condensed Consolidated Financial Statements for the three months and nine months ended 30 September 2020 with the independent auditor's report on review of these statements.

 

Andrey Kostin, VTB President and Chairman of the Management Board, said:

 

"VTB Group has achieved good performance against key operating metrics in 9M 2020. While we delivered sizeable growth in net interest and commission income, expenses rose at a modest pace. Against the backdrop of a recovery in business and consumer activity following the spring decline caused by the pandemic, we achieved strong growth in our loan portfolio and client base.

 

"Following the inevitable deterioration of the financial condition of some types of borrowers due to the restrictive measures, we have significantly increased loan loss provisions, which put strong pressure on the bottom line. VTB Group's net income in January-September 2020 amounted to RUB 59.1 billion, having decreased by 54% year-on-year.

 

"The unprecedented circumstances that have impacted the entire world have confirmed we have been pursuing the right strategy of accelerated digitalisation and transformation of the business and processes. Over the past several months, VTB team has made remarkable progress on further improving our services and applications and strengthening customer relations as a bank of first choice. This bodes well for profitability to get back in line with strategic targets in the foreseeable future."

 

FINANCIAL HIGHLIGHTS

 

 

VTB Group achieved strong growth in core banking income and business volumes in 9M 2020

 

The total loan book grew by 12.9% in 9M 2020

 

 

Customer funding increased by 12.7% in 9M 2020

 

 

 

 

Income statement

 

(1) Includes provision charge for credit losses on debt financial assets, provision charge for credit losses on credit-related commitments and other financial assets, and provision charge for legal claims and other commitments.

 

In 9M 2020, net operating income before provisions increased 6.0% amid strong growth in net interest and net fee and commission income

 

 

External factors, including declining oil prices and the COVID-19 pandemic, led to an increase in provision charges in 9M 2020

 

 

VTB Group achieved further operating efficiency improvements in 9M 2020

 

Other results

Leader in investment banking

During 3Q 2020, VTB Capital remained #1 in investment banking services in Russia. The Company was the #1 M&A advisor in Russia and the CIS according to Dealogic and Mergermarket, and it was also #1 in debt capital markets in Russia and the CIS according to Dealogic, Refinitiv and Bloomberg.

Continued growth of the investment products sales platform VTB Capital Investments

 

Key projects and initiatives of VTB Group's global business lines in 3Q 2020

Medium and Small Business global business line

Projects to increase transaction activity:

Product and customer experience digitalisation projects:

Retail Business global business line

A number of initiatives were implemented in 3Q 2020 to drive customer base growth and expand customer reach in the market. As a result, as of 30 September 2020 the number of active Bank clients reached an all-time high of 13.5 million. The increase in customer activity was due to a record number of new customers (561 thousand as the end of the quarter) and a considerable increase in the number of clients who carried out operations during the quarter (878 thousand). The biggest increase was seen in payroll accounts, reflecting the revival of business activity in 3Q 2020.

 

As part of efforts to improve the efficiency of customer service, a new office format was launched in 3Q 2020 that will reduce customer waiting times by a third and increase work efficiency by 40%. Beginning in 2021, VTB plans to launch every new branch in this format.

 

Projects to increase transaction activity:

 

Funding cost reduction projects:

 

Product digitalisation projects:

 

Customer experience improvement projects:

 

In Q3 2020, VTB Group developed a number of important IT initiatives

 

Attachment

File: VTB 9M IFRS REPORT

RUB billion

30 September

2020

30 June

2020

31 December

2019

Change in 9M 2020, % or bps

Change in 3Q 2020, % or bps

Total assets

17,425.7

16,346.9

15,516.1

12.3%

6.6%

Loans and advances to customers, including pledged under repurchase agreements (gross), as reported

12,936.6

11,947.2

11,461.5

12.9%

8.3%

Legal entities

9,188.5

8,347.0

8,096.2

13.5%

10.1%

Individuals

3,748.1

3,600.2

3,365.3

11.4%

4.1%

Customer funding

12,369.1

11,852.4

10,974.2

12.7%

4.4%

Legal entities

6,824.1

6,583.5

5,932.6

15.0%

3.7%

Individuals

5,545.0

5,268.9

5,041.6

10.0%

5.2%

NPL ratio

5.7%

5.1%

4.7%

100 bps

60 bps

LDR ratio

97.5%

94.1%

98.2%

-70 bps

340 bps

RUB billion

9M

 2020

9M

2019

Change, %

3Q

2020

3Q

2019

Change, %

 

 

Net interest income

387.5

323.8

19.7%

135.5

110.2

23.0%

Net fee and commission income

84.7

67.3

25.9%

31.8

22.4

42.0%

Operating income before provisions

450.4

425.0

6.0%

159.9

155.2

3.0%

Provision charge(1)

-185.9

-77.8

138.9%

-72.0

-32.4

122.2%

Staff costs and administrative expenses

-192.1

-184.3

4.2%

-63.0

-58.7

7.3%

 

Net profit

59.1

128.0

-53.8%

17.2

51.2

-66.4%

 

 

 

 

 

 

 

 

 

 

 

RUB billion

30 September

2020

30 June

2020

31 December

2019

Change in 9M 2020, % or bps

Change in 3Q 2020, % or bps

Total assets

17,425.7

16,346.9

15,516.1

12.3%

6.6%

Loans and advances to customers, including pledged under repurchase agreements (gross), as reported

12,936.6

11,947.2

11,461.5

12.9%

8.3%

Legal entities

9,188.5

8,347.0

8,096.2

13.5%

10.1%

Individuals

3,748.1

3,600.2

3,365.3

11.4%

4.1%

Customer funding

12,369.1

11,852.4

10,974.2

12.7%

4.4%

Legal entities

6,824.1

6,583.5

5,932.6

15.0%

3.7%

Individuals

5,545.0

5,268.9

5,041.6

10.0%

5.2%

NPL ratio

5.7%

5.1%

4.7%

100 bps

60 bps

LDR ratio

97.5%

94.1%

98.2%

-70 bps

340 bps

RUB billion

9M

 2020

9M

2019

Change, %

3Q

2020

3Q

2019

Change, %

 

 

Net interest income

387.5

323.8

19.7%

135.5

110.2

23.0%

Net fee and commission income

84.7

67.3

25.9%

31.8

22.4

42.0%

Operating income before provisions

450.4

425.0

6.0%

159.9

155.2

3.0%

Provision charge(1)

-185.9

-77.8

138.9%

-72.0

-32.4

122.2%

Staff costs and administrative expenses

-192.1

-184.3

4.2%

-63.0

-58.7

7.3%

 

Net profit

59.1

128.0

-53.8%

17.2

51.2

-66.4%

 

 

 

 

 

 

 

 

 

 

 

ISIN:

US46630Q2021

Category Code:

MSCM

TIDM:

VTBR

LEI Code:

253400V1H6ART1UQ0N98

Sequence No.:

87433

EQS News ID:

1146375


 

End of Announcement

EQS News Service

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