AK BARS Bank has announced a net profit of RUB 1,1 bln. for the first quarter of 2017 in accordance with IFRS financial statements.
The Chairman of the Management Board of AK BARS Bank Zufar Garaev commented: «Due to the quality improvements and transformations started in 2016, the Bank reported increase of net interest and commission income followed by decrease of interest expenses. Furthermore, due to high level of liquidity the Bank reduced short-term funding from credit organizations in the reporting period. AK BARS Bank will continue to strengthen its market position with an emphasis on providing quality products and services, advancing technologies and improving service model for our clients».
Operating profit for the first quarter was 8,3% higher as compared to the same period of 2016 and amounted to RUB 3,3 bln. The growth was driven by gaining positive net interest income (after provision) of RUB 1,1 bln. against negative value of RUB 5,3 bln. in 2016.
Net interest income (before provision) significantly increased by 83% and accounted for RUB 2,2 bln. The interest income decreased to 26% due to a reduction of the interest rates in the reporting period. In the meantime, the optimized cost of funding of the Bank resulted in decreasing interest expenses by 40%.
Net fee income for the first quarter increased by 11,7% to RUB 0,6 bln.
As at 31 March 2017 total assets of the Bank amounted to RUB 393 bln. with a reduction by 2,6 %., which partially resulted from strengthening of Russian ruble in the reporting period.
Total loan portfolio after provision amounted to 208,2 bln and decreased by 1,9%. Herewith the share of loan portfolio in the total assets comprises 53% against 52,6 % at the end of 2016.
As at 31 March 2017, customer’s funds were RUB 244,5 bln. and reduced by 7,7 %. However, the funds rose by the Bank through issuing of its own notes and bonds rose by 35,6% and amounted to RUB 74 bln. as of 31 March 2017. In addition, the Bank has a substantial liquidity cushion, in particular, cash and cash equivalents on the balance sheet increased by 16,5% in the first quarter and accounted for RUB 28,9 bln.
Return on equity was 10% and return on assets was 1,1% for the first quarter of 2017.
Presently, in accordance with the strategic plan AK BARS Bank is completing the increase of its share capital in the amount of RUB 10 bln.