VTB Group announces condensed IFRS financial results for 1Q 2021 (Summary consolidated financial information)

дата19.04.2021

VTB Bank (“VTB” or “the Bank”), the parent company of VTB Group (“the Group”) today publishes its consolidated reports of financial position and income statement for the period ended 31 March 2021.

On 30 April 2021, VTB will publish the Interim Condensed Consolidated Financial Statements for the three months ended 31 March 2021 with the independent auditor’s report on review of these statements and hold a conference call with investors and analysts.

Tomorrow, on 20 April 2021, VTB will hold an online investor day with members of the senior management team. Registration for the event is available at www.vtbinvestorday.com.

Dmitry Pianov, member of the Management Board and Chief Financial Officer of VTB Bank, said:

“We are delighted to report a strong bottom line for 1Q 2021, which reflects our robust operating performance as well as the post-pandemic economic recovery. In the first quarter, VTB’s net profit amounted to RUB 85.1 billion (with an ROE of 19.2%), having increased more than twofold year-on-year. These results fully confirm our guidance for the full year and put VTB firmly on track to deliver a solid return on equity going forward.”

  • As of 31 March 2021, gross loans and advances to customers amounted to RUB 13.1 trillion, declining 0.1% year-to-date. Loans to individuals increased by 4.4% year-to-date to RUB 4.0 trillion, while loans to legal entities decreased by 2.0% to RUB 9.1 trillion. As a result, the share of retail lending in the Group’s total loan portfolio increased to 31% compared to 29% at year-end 2020.
  • Customer funding increased by 6.7% since the beginning of 2021, to RUB 13.7 trillion. The share of customer funding in the Group’s total liabilities increased to 81.9% in the first three months of 2021 (78.1% as of 31 December 2020).
  • As a result of faster growth in customer funding, the loans to deposits ratio (LDR) decreased to 89.4% as of 31 March 2021 (95.6% on 31 December 2020).

The Group significantly improved profitability on the back of strong growth in key banking income and stabilisation of loan portfolio quality.

  • VTB Group posted a net profit of RUB 85.1 billion for 1Q 2021, up 113.8% year-on-year which corresponds to an ROE of 19.2% (9.5% for 1Q 2020).
  • Net interest income was RUB 145.6 billion, an increase of 21.6% year-on-year. Net interest margin was 3.7% (up 10 bps year-on-year).
  • Net fee and commission income totalled RUB 38.6 billion, rising by 19.1% year-on-year. The strong net fee and commission income performance was driven by the Group’s growing transactional business and steadily increasing commissions for sales of insurance products and brokerage commissions.
  • The Group’s cost of risk for the first three months of 2021 amounted to 0.7%, having decreased by 80 bps compared to the same period of 2020. At the same time, the provision charge amounted to RUB 22.6 billion, down 49.9% year-on-year.
  • Staff costs and administrative expenses amounted to RUB 64.9 billion in 1Q 2021, an increase of 1.2% compared to the same period last year.
  • Growth in profitability has contributed to a significant improvement in operating efficiency: the costs to operating income before provisions ratio decreased by 580 bps year-on-year to 33.5%.

The Group maintained strong performance in client assets and fee and commission income across its investment products platform VTB Capital Investments

  • VTB Capital Investments’ total client assets increased by 11.6% to RUB 3.8 trillion at the end of the first quarter of 2021. At the same time, retail customer assets increased 16.1% YTD to RUB 2.1 trillion.
  • During the first three months of the year, VTB Capital Investments’ customer base grew by 19%, to more than 1.4 million clients.
  • VTB Capital Investments’ income doubled in the first three months of 2021 compared to the same period in 2020, reaching RUB 7.0 billion.

P&L highlights

(in RUB bn)

1Q’2021

1Q’2020

change

Net interest income

145.6

119.7

21.6%

Net fee and commission income

38.6

32.4

19.1%

Other operating income

9.8

11.1

-11.7%

Net operating income before provisions

194.0

163.2

18.9%

Provision charge for credit losses and other provisions

-22.6

-45.1

-49.9%

Staff costs and administrative expenses

-64.9

-64.1

1.2%

Profit before tax

106.5

54.0

97.2%

Income tax expense

-21.4

-14.2

50.7%

Net profit

85.1

39.8

113.8%

Performance indicators

1Q’2021

1Q’2020

change

NIM

3.7%

3.6%

10 bp

NCM

0.9%

0.8%

10 bp

CoR

0.7%

1.5%

-80 bp

CIR

33.5%

39.3%

-580 bp

ROE

19.2%

9.5%

970 bp

Balance sheet highlights

(in RUB bn)

31 March 2021

YTD

31 December 2020

Cash and short-term funds

1,353.6

10.1%

1,229.5

Financial assets

2,134.7

16.4%

1,833.5

Due from other banks, including pledged under repurchase agreements

761.4

-9.1%

837.9

Loans and advances to customers, including pledged under repurchase agreements (net)

12,239.0

-0.2%

12,264.4

Other assets

2,099.7

6.2%

1,976.9

Total assets

18,588.4

2.5%

18,142.2

Due to other banks and Other borrowed funds

1,649.0

-23.2%

2,146.2

Customer deposits

13,690.8

6.7%

12 831.0

Debt securities issued

203.6

-5.6%

215.7

Subordinated debt

325.5

2.8%

316.7

Other liabilities

850.2

-6.6%

910.0

Total liabilities

16,719.1

1.8%

16,419.6

Total equity

1,869.3

8.5%

1,722.6

Balance sheet and asset quality indicators

31 March 2021

YTD

31 December 2020

LDR

89.4%

-620 bp

95.6%

Leverage

8.9

-6.2%

9.5