Home Credit & Finance Bank 2006 IFRS results: Net profit increases to RUR 699 million
Moscow, 03/07/2007
Home Credit & Finance Bank (“HCFB”), rated Moody’s Ba3/NP/D-, S&P B/C, announces its financial results for the year ended 31st December 2006 in accordance with International Financial and Reporting Standards (IFRS).PRESS RELEASE NOT FOR PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES
HIGHLIGHTS
- HCFB reported a net profit of RUR 699 million for 2006 - an increase of 127% from RUR 309 million in the prior year period
- 44% increase in net interest income to RUR 8.1 billion (2005: RUR 5.6 billion) attributable to an increase in the volume of credit card loans
- The volume of loans granted in 2006 increased by 17% year-on-year to RUR 56.1 billion compared to RUR 47.9 billion in 2005
- The amount of credit card loans outstanding as at 31st December 2006 stood at RUR 11.7 billion - an increase of 316% over the comparable period last year. Credit card loans accounted for 32% of the gross loan book which compares to 10% of the gross loan book as at the year-end 2005
- Growth in the Bank's cash loans book performed positively with volumes increasing to RUR 2.2 billion in 2006 from RUR 92 million in 2005
- HCFB's market share in the point of sale business stood at 22%
- HCFB's client database exceeded 11 million people
- As at the year-end 2006, Home Credit & Finance Bank had a risk-weighted capital adequacy ratio of 23.7%; and a Tier 1 capital position of 21.7%
- Standard & Poor's upgraded the Bank's rating in July 2006 to 'B' from 'B-'
- The level of provisions remained adequate at 95.5% as of year end
HCFB's net profit increased by 127% year-on-year to RUR 699 million for 2006, up from RUR 309 million reported for 2005. The result was driven by the Bank's net interest income of RUR 8.1 billion for the year which represented an increase of 44% from RUR 5.6 billion for the prior year period. The growth in net interest income is attributable to increase in the volume of revolving credit card loans to 31.9% of the gross loan book as of year-end 2006.
The total volume of loans granted by HCFB in 2006 was RUR 56.1 billion which is 17.1% higher compared to the corresponding period in 2005. The Bank's gross loan book increased by 26% year-on-year to RUR 36.8 billion as at 31 December 2006, compared to RUR 29.2 billion at the end of 2005, driven mainly by the growth in the revolving credit card portfolio (316% increase year-on-year). Total number of credit cards issued exceeded 4.6 million cards as at the year-end 2006.
The Bank also increased the volume of cash loans to consumers in Russia. As at 31 December 2006, HCFB's cash loan portfolio stood at RUR 1.8 billion, making up 5% of gross loan portfolio, compared to RUR 79 million in 2005; this represents a twenty-two fold increase year-on-year.
As at the end of 2006, Home Credit & Finance Bank has a risk-weighted capital adequacy ratio of 23.7%; and a Tier 1 capital position of 21.7%. In July 2006, Standard & Poor's upgraded the Bank's rating to 'B' from 'B-'.
Financial Summary
| RUB million | 31 December 2006 | 31 December 2005 | y-o-y change |
|---|---|---|---|
| Gross Loans Granted | 56,116 | 47,911 | +17.1% |
| Operating Income | 9,479 | 6,871 | +37.9% |
| Net Profit | 699 | 309 | +126.5% |
| Total Assets | 45,386 | 39,354 | +15.3% |
| Total Equity | 9,962 | 8,557 | +16.4% |
Notes to Editors:
Home Credit & Finance Bank (Moody's Ba3/NP/D-, S&P B/C) has been operating in the Russian consumer finance market since 2002.
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.
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For further enquiries, please contact:
Press Office
Alena Zheltova
Head of PR
Home Credit & Finance Bank
Tel: (+7) 495 514 1019
Mobile: (+7) 916 350 3643
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
Important notice:
This press release does not constitute an offer of any securities of HCFB for sale in the United States nor may the securities be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended, and the rules and regulations thereunder.
Any public offering of the securities to be made in the United States will be made by means of a prospectus that may be obtained from HCFB and that will contain detailed information about HCFB and management, as well as financial statements. However, HCFB does not intend to register any portion of the offering in the United States or to conduct a public offering of any securities in the United States.
This press release is not an invitation nor is it intended to be an inducement to engage in investment activity for the purpose of Section 21 of the Financial Services and Markets Act 2000 of the United Kingdom (the "FSMA"). To the extent that this press release does constitute an inducement to engage in any investment activity included within this press release, it is directed only at (i) persons that which are outside the United Kingdom, (ii) persons who are investment professionals within the meaning of Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) of the United Kingdom (the "Financial Promotion Order"); or (iii) persons who fall within Articles 49(2)(a) to (d) ("high net worth companies, unincorporated associations etc.") of the Financial Promotion Order; and (iv) any other persons to whom this press release for the purposes of Section 21 of FSMA can otherwise lawfully be made (all such persons together being referred to as "relevant persons"), and must not be acted on or relied upon by persons other than relevant persons. Any invitation or inducement to engage in any investment activity included within the press release is available only to relevant persons and will be engaged in only with relevant persons." Anyone other than a relevant person must not rely on this press release.
This document is not a prospectus and, to the extent that it may constitute an advertisement, does not constitute an offer to sell or the solicitation of an offer to purchase notes or other securities of HCFB. Investors should not subscribe for any securities referred to in this document except on the basis of the information contained in the prospectus relating to the securities.
This document is an advertisement for the purposes of applicable measures implementing Directive 2003/71/EC (such Directive, together with any applicable implementing measures in the relevant home Member State under such Directive, the "Prospectus Directive"). A prospectus prepared pursuant to the Prospectus Directive will be published, which, when published, can be obtained from the offices of ABN AMRO Bank N.V. and BNP Paribas.
This press release does not constitute or form part of any public offer or advertisement of securities in the Russian Federation or in any other jurisdiction, and does not constitute any offer, or any invitation to make offers, to purchase any securities in the Russian Federation or in any other jurisdiction.
Forward-looking statements. Some of the information in this press release may contain projections or other forward-looking statements regarding future events or the future financial performance of HCFB. We caution you that these statements are not guarantees of future performance and future performance involves risks, uncertainties, and assumptions that we cannot predict with certainty. Accordingly, our actual outcomes and results may differ materially from what we have expressed or forecasted in the forward-looking statements. We do not intend to update these statements to make them conform with actual results.
03/07/2007
