LOCKO-BANK announced its financial results for 9 months of 2018 according to IFRS: Net income amounted to RUB 1.2 bn

LOCKO-BANK announced its consolidated interim financial statements for 9 months of 2018 according to IFRS.

LOCKO-Bank’s Income before tax amounted to RUB 1.5 bn and net profit - RUB 1.2 bn for nine months of 2018.

LOCKO-Bank’s key indicators of statement of profit or loss for the nine-month period:

• Total profit for nine months of 2018 amounted to RUB 1,2 bn, decreasing by 26,3% compared to the same period of 2017.
• Net interest income performed 10,8% growth for nine months of 2018 compared to the same period of 2017 and reached RUB 4,0 bn.
• Net fee and commission income grew up to RUB 2,4 bn, increasing by 67.3% compared to the same period of the last year.
• Net loss from operations with financial instruments amounted to RUB 0,6 bn versus net income of RUB 0,4 bn last year.
• Net interest margin remains at a consistently high level and amounts to 6,6% for nine months of 2018.
• Net provision costs for expected credit losses decreased by 2,5% to RUB 0,7 bn.
• Operating expenses for 9 months of 2018 grew by 20,5% and amounted to RUB 3,6 bn compared to RUB 3,0 bn for 9 months of 2017, also due to growth in advertising costs by 40%.

Review of LOCKO-Bank’s key financial indicators:

• Total loan portfolio net of allowance for impairment decreased for 9 months of 2018 by 3,8% and amounted to RUB 49,6 bn.
• Assets for 9 months of 2018 increased by 10,6% to RUB 94,6 bn basically due to increase in investment securities portfolio.
• Current accounts and deposits from customers changed little and amounted to RUB 60,3 bn on 30 September 2018.
• Capital base for 9 months of 2018 increased by 5,2% up to RUB 16,9 bn.

Key financial ratios, %:

• Return on equity (ROE) for 9 months of 2018 amounted to 9,9% decreasing by 5,8 p.p. in comparison to 2017.
• Return on assets (ROA) for 9 months of 2018 amounted to 1,9% compared to 2,9% in 2017.
• Cost to income (CTI) based on results of 9 months of 2018 amounted to 61,3% and increased by 11,1 p.p. in comparison with the previous year.
• Capital adequacy ratio under Basel Capital Accord amounted to 23.7% as of the end of the third quarter of 2018 and increased by 3,3 p.p. in comparison with figures at the end of 2017.

Operating income for 9 months of 2018 increased by 2.4% compared to the same period of 2017 and amounted to RUB 5.9 bn.

The share of net fee and commission income in Operating income structure grew to 40.7% compared to 24.9% for 9 months of 2017.

Share of non-performing loans in the loan portfolio (NPL 90+) for 9 months of 2018 decreased by 1.6 p.p. and amounted to 6%.

Retail loan portfolio net of allowance for impairment following the results of 9 months of 2018 amounted to RUB 40.3 bn performing a 22.6% growth. The growth of the loan portfolio is subject to increase in the incoming flow of loan applications as a result of the launch of wide advertising company with the same level of approval of applications and risk appetite. The high quality of the loan portfolio continues to be a priority for the Bank.