HCFB reports net profit increase of 52 % up to RUR 111 million

Moscow, 09/04/2006

Home Credit & Finance Bank ("HCFB") [Moody's Ba3/NP/D-, S&P B/C], one of the leading providers of consumer credit in Russia, announces its financial results for the six months ended 30th June 2006 in accordance with International Financial and Reporting Standards (IFRS).

"The first half of this year has seen us continue to deliver on our strategy of growing the credit card operations. The net profit for the period of RUR 111 million was driven by a 37.6% increase in net interest income of RUR 3.7 billion as the Bank continues to focus on growing the percentage of revolving credit cards in the gross loan book. We are confident in the positive outlook for the second half of the year."

Andrey Lykov, the Chairman of HCFB Management Board

Highlights

Net profit for the half year increased 51.5% to RUR 111 million from RUR 73 million in the prior year period
Continuing improvement in net interest income of RUR 3.7 billion - an increase of 37.6% from RUR 2.7 billion as the Bank focuses on the higher yielding properties of the revolving credit loan portfolio
Significant increase in the Bank's revolving credit activities which now account for 21% of the gross loan book. HCFB is the second largest provider of credit cards in Russia with over 3 million cards in issue and a 5.2% market share
The total volume of cumulative consumer loans granted in the first half was RUR 23 billion - a 21.2% increase over the comparable period last year. HCFB's market share in the point of sale business remained stable at 28%
HCFB strictly follows its strategy for stable and profitable growth with focus on increasing the quality of loan book and diversifying its product range by introducing new products and entering new markets
Maintenance of strong capitalisation with risk weighted CAR of 31.9% (YE 2005: 32.2%)
Capital position strenghtened in April by the conversion of US$ 25 million of subordinated debt into equity. HCFB continues to receive the full support of its parent, PPF Group
Standard & Poor's upgraded HCFB's credit rating to B from B- in July 2006

HCFB reported a net profit of RUR 111 million - an increase of 51.5% from RUR 73 million in the prior year period. This result was driven by the increase of 37.6% in net interest income of RUR 3.7 billion for the period and is primarily attributable to the increase in the volume of revolving credit card loans.

In the first six months of 2006, HCFB experienced a significant increase in the percentage of the loan portfolio represented by credit card loans as part of the Bank's strategy to focus on the revolving credit market in Russia with its higher-yielding, lower-risk characteristics and growth potential. HCFB is the second largest provider of credit cards in Russia with over 3 million cards in issue and a 5.2% market share.

The amount of credit card loans outstanding as at 30 June 2006 stood at RUR 6.1 billion which represents a 116% increase in the outstanding amount of RUR 2.8 billion as at 31 December 2005. Credit card loans now account for 21% of the gross loan book which compares to 9.6% of the gross loan book as at 31 December 2005 and just under 1% as at 30 June 2005. HCFB expects the percentage of the loan book accounted for by credit card loans will continue to increase.

HCFB's market share in the point of sales market remained stable at 28% despite and its leading position in POS-loans segments remains unchanged.. The volume of point of sales loans granted stood at RUR 18.4 billion and remains virtually unchanged from the previous year reflecting the seasonality of the consumer finance market, the stricter underwriting criteria and the Bank's progressive focus on the credit card market in Russia.

As part of HCFB's continuing focus on profitable growth, the Bank is expected to enter the cash loan market in the second half of this year. Pilot testing of cash loans has been undertaken in Nizhni Novgorod as well as in Saint Petersburg where the products have been distributed through the Post Office network in a form of postal order. In addition, HCFB is seeking to continue the diversification of its product range and expects to enter new markets in the near future.

HCFB maintains a strong capitalization position with a capital adequacy ratio of 31.9% as at the half-year and with a risk weighted Tier 1 capital position of 29%. HCFB continues to benefit from the full support of the parent company, the PPF Group.

Financial Summary

Gross Loans Granted	22, 991	19, 997	21.2%
Operating Income	3,892	3,379	15.2%
Net Profit	111	73	52.1%
Total Assets	36,501	29,417	24.1%
Total Equity	9,306	2,841	227.6%

Notes to Editors: -

Home Credit & Finance Bank (Moody's Ba3/NP/D-, S&P B/C) has been operating in the Russian consumer loan market since 2002. It has become one of Russia's market leaders with 28% market share of the point-of-sale credit market as of 30 June 2006. HCFB is majority controlled by the international company, the PPF Group.
HCFB offers its clients a wide range of credit products with variable credit terms. As of 30 June 2006, HCFB's products have been offered in 21,400 stores across 1,100 cities throughout Russia. The bank's regional network comprises 57 representative offices across the Russian Federation. At the end of 2004, HCFB entered the revolving credit business in Russia and with over 3 million credit cards in issue to date has become one of the leaders of revolving credit in Russia with 5.2% market share as at the end of June 2006.
Home Credit & Finance Bank is a member of the Home Credit Group. The companies of the Home Credit Group have been operating in the Central and Eastern European consumer loan markets since 1997. The Home Credit Group belongs to the PPF international group of companies which has interests in insurance and consumer finance, and provides complex asset management services. During its 15 years in business, PPF has become a leading international financial investor, managing assets of approximately USD 10 billion as at the end of 2005.
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For further enquiries, please contact:

Alena Zheltova
Head of PR Investor Relations
Home Credit & Finance Bank
Baumanskaya str., 4, 105005 Moscow
Russian Federation
tel.: +7 495 514 1019
www.homecredit.net
e-mail: press@homecredit.ru

Tomas Cerny
Head of Capital Markets
Home Credit Group
Tel: (+420) 224 559 174
E-mail: tomas.cerny@homecredit.eu

09/04/2006

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