Bank "Saint Petersburg : Saint Petersburg’s Net Profit increased by 35% in 3Q 2020

Bank Saint Petersburg summed results for 3Q and 9M 2020 according to International Financial Reporting Standards (IFRS). Financial highlights according to IFRS Consolidated Statements:

• 9M 2020 Net profit amounted to RUB 6.3 billion (+15.4% compared with 9M 2019), including RUB 2.8 bn in 3Q 2020 (+35.5% compared with 3Q 2019);

• 9M 2020 ROAE up to 10.1% (9.5% in 9M 2019), 3Q 2020 ROAE up to 12.9% (10.4% in 3Q 2019);

• Core banking revenues increased by 7.5% y-o-y up to RUB 23.7 bn in 9M 2020), including RUB 7.9 bn in 3Q 2020 (+4.3% compared with 3Q 2019);

• Loan portfolio grew by 16.7% YTD, including 12.3% q-o-q growth.

Alexander Savelyev, Chairman of the Management Board, comments on the Bank's 9M 2020 results:

'Throughout the year we have remained cautious in terms of our expectations and guidance, having in mind high level of uncertainty during the pandemic. However strong 9M 2020 financials have proved our business model to be stable even amid the crisis, allowing for increasing profitability and business volume, as well as liquidity remaining high. Dividend payout decision stands as the consequence of our financial stability and ability to grow in spite of extrinsic circumstances'.

On October 22, 2020, Supervisory Board discussed dividend payout procedure, as well as recommended to the Extraordinary General Shareholders Meeting to pay out dividends in the total amount of RUB 1.6 bn (the dividend payout amount calculated based on 20% of IFRS FY 2019 net income). Extraordinary General Shareholders Meeting is to take place in a form of remote voting on November, 30th, 2020. Dividend record date is December 11th, 2020.

Bank Saint Petersburg is ranked 15^th in terms of assets and 15^th in terms of retail deposits among Russian banks (Interfax ranking) as of October 1, 2020. The Bank provides services to 2 042 000 individuals and 50 000 corporates. The number of cards issued by the Bank reached 1 516 000 with 805 in-network ATMs and 1 356 000 active online banking users.

Results summary for 9M 2020

Net interest income (NII) amounted to RUB 18.3 billion for 9M 2020 (+8.4% compared with 9M 2019) including RUB 6.0 bn for 3Q 2020 (+3.1% compared with 3Q 2019). Interest income for 9M 2020 decreased by 11.3% compared with 9M 2019; interest income is comprised mostly of interest income on loans and advances to customers (81.5%). Interest expense decreased by 28.4%: interest expenses on retail term deposits decreased by 22.1% (44.7% of total interest expenses) while interest expenses on corporate term deposits decreased by 26.1% (21.5% of total interest expenses).

Net interest margin (NIM) amounted to 3.8% for 9M 2020 (3.7% for 9M 2019) and 3.7% for 3Q 2020 (3.9% for 3Q 2019).

Net fee and commission income amounted to RUB 5.2 billion for 9M 2020 (+9.0% compared with 9M 2019) including RUB 1.9 bn for 3Q 2020 (+7.4% compared with 3Q 2019). Compared with 9M 2019, income from cash and settlement transactions grew by 8.5% (40.0% of total F&C income), income from plastic cards settlements increased by 2.2% (37.3% of total F&C income).

Net trading income for 9M 2020 amounted to RUB 1.0 billion (+ RUB 1.1 bn compared with 9M 2019) including RUB 0.6 bn for 3Q 2020 and is comprised mostly of income from operations with foreign currencies and derivatives in the amount of RUB 1.2 bn.

Revenues amounted to RUB 26.6 billion for 9M 2020 (+16.0% compared with 9M 2019) including RUB 9.6 bn for 3Q 2020 (+27.1% compared with the 3Q 2019).

Cost-to-Income Ratio stood at 41.0% for 9M 2020 (44.7% for 9M 2019) including 35.0% for 3Q 2020 (43.8% for the 3Q 2019). Operating costs amounted to RUB 10.9 billion for 9M 2020 (+6.2% compared with 9M 2019)) including RUB 3.3 bn for 3Q 2020 (+1.4% for the 3Q 2019).

Net income for 9M 2020 amounted to RUB 6.3 billion (+15.4% compared with 9M 2019) including RUB 2.8 bn for 3Q 2020 (+35.5% compared with the 3Q 2019). The Bank's return on equity (ROAE) amounted to 10.1% for 9M 2020 (9.5% for 9M 2019) and 12.9% for 3Q 2020 (10.4% for the 3Q 2019).

As of October 1, 2020, the Bank's assets amounted to RUB 720.8 billion (+7.0% compared with January 1, 2020 and +7.4% compared with July 1, 2020).

Customer deposits totaled RUB 474.8 billion (+13.7% compared with January 1, 2020; +9.9% compared with July 1, 2020). During 9M 2020, the volume of current and settlement accounts increased by 51.1%; the volume of term deposits decreased by 6.5%. As of October 1, 2020, 56.1% of customer deposits belonged to individuals and 43.9% - to corporate customers.

Equity and capital. As of October 1, 2020, the shareholders equity amounted to RUB 86.5 billion (+8.1% compared with January 1, 2020 and +3.4% compared with July 1, 2020). The Bank's total capital amounted to RUB 101.7 billion (+5.9% compared with January 1, 2020 and +2.7% compared with July 1, 2020). As of October 1, 2020, the Bank's Tier 1 and total capital adequacy ratios were 9.8% and 13.1% respectively.

Loan portfolio before provisions totaled RUB 468.7 billion (+16.7% compared with January 1, 2020; +12.3% compared with July 1, 2020). Loans to corporate customers represented 76.2% of the loan portfolio, loans to individuals - 23.8%. During 9M 2020, corporate loan portfolio increased by 19.6% to RUB 357.1 billion. During 9M 2020, retail loan portfolio increased by 7.8% to RUB 106.9 billion. During 9M 2020, mortgage loans grew by 10.2%, consumer loans grew by 2.7%, car loans grew by 2.6%.

Loan portfolio quality. As of October 1, 2020, the share of problem loans in the Bank's portfolio amounted to 9.4% (9.2% as of January 1, 2020). The rate of provisions for loan impairment amounted to 8.8% (8.3% as of January 1, 2020). Provision charge for 9M 2020 amounted to RUB 7.2 billion (RUB 2.0 bn for 3Q 2020). For 9M 2020, loans in the amount of RUB 3.2 billion (RUB 1.7 bn for 3Q 2020) were written off.

Bank's 9M 2020 IFRS financials are to be reviewed during regular Supervisory board meeting scheduled to be held on November, 26^th, as well as the following 9M 2020 reports: risk management, stress-testing results, smallµcorporates segment results, MOEX preferred shares listing, Bank's brand and internal audit service 2021 operational plan approval.

9M 2020 IFRS Financial Statements are available on the Bank's website:

https://www.bspb.ru/en/investors/financial-statements/IFRS/.