VTB during the year there was a gradual decrease in reserve requirements and the cost of risk, but “this flight was interrupted by a situation with “Transaero”, said CFO second by assets of the Russian Bank Herbert Moos.
MOSCOW, Nov 17. The situation with “Transaero” interrupted the trend decline of reserves VTB: the Bank estimated the losses in the third quarter from loans and leasing contracts with pre-bankrupt airline to 16.4 billion rubles, reported to journalists the Deputy Chairman, CFO second by assets in the Russian Bank Herbert Moos.
VTB during the year there was a gradual decrease in reserve requirements and the cost of risk, but “this flight was interrupted by a situation with “Transaero”, said the MEP. “The theme of gradual reduction provisions, she observed, and she… positive In the third quarter… we had quite a significant impact “Transaero”, it did not allow us to implement the same trend,” he said.
As noted the MoE, “the thread through the financial results” of the Bank since the beginning of the year was the theme of the restoration margin, lower reserve requirements and cost of risk, control over costs, “the trend of record” fee and Commission income. In addition, began to grow the Bank’s loan portfolio growth amounted to 4% in the first nine months against a rise of 6% for the first half.
VTB has repeatedly said that “closed” the issue on Ukraine and to “Mechel”, which ceased to affect the financial results of VTB. However, the problems with “Transaero” has created a significant negative impact on the Bank’s results in the third quarter.
“In the third quarter we were overtaken by “Transaero”… the Creation of reserves in retail continued to weaken in the corporate segment has also been falling since the fourth quarter of last year, first, second. Unfortunately, this flight was interrupted by getting into the reserves, “Transaero”, — he noted.
The results of the third quarter
Net loss in accordance with IFRS VTB group for the first nine months amounted to 10.9 billion rubles against a profit of 5.4 billion rubles a year earlier. In the third quarter of VTB received a net profit of 6.2 billion versus 0.4 billion for the third quarter of last year and 5 times higher than in the second quarter.
Allocations to reserves in January-September fell compared with the same period in 2014 is 17.7% and amounted to RUR 136.9 billion rubles, which is worse than the consensus forecast, based on survey analysts — 129.4 deaths billion. The costs of reserves in the third quarter amounted to 57 billion, which is 12.3% lower than a year ago. The costs of reserves in the corporate portfolio amounted to 40,9 billion. Analysts predicted that the Bank will increase its reserves by 51.6 billion.
Lending to corporate clients in the third quarter increased by 13%, in the first nine months by 5.4%, retail growth of 1.8% and a decline of 1.2% respectively. Net interest income VTB Bank in January-September decreased by 24.5%, to 202,5 billion rubles. Net interest margin for the first nine months decreased to 2.5% from 4.3% for the same period in 2014. In the third quarter it rose to 3.2% from 2.5% in the second and 1.7% in the first quarter.
“In the third quarter we demonstrated significant growth of loan portfolio and customer funds… the gradual re-estimation of liabilities interest margin of the group continued to grow, along with a high level of fee income contributed to a further recovery in net profit. The cost of credit risk remained at a controllable level, despite the fact that we had to form significant reserves for impairment of debts of individual corporate borrowers”, — said the President — Chairman of the management Board of VTB Bank Andrey Kostin, whose words are in the Bank.
The scenario of bankruptcy Transaero
The Treasurer noted that the reserves for loans “Transaero” in the third quarter amounted to 16.4 billion rubles, including provisions on leasing debt is the losses the Bank assesses in the event of bankruptcy of the air carrier. “All we had in the third quarter, we reserved. Depending on changes in the situation… As you know, the situation with Transaero airlines is not yet complete, will look at the situation. If it is to evolve for the better, we will think whether to dissolve some reserves, if the worse can to increase their,” — said the Deputy Chairman of VTB.
“Provisions related to “Transaero”, which reflect the current status of our debt and the prospects of settlement of this debt with this company. Because the number of banks filed for bankruptcy of this company, naturally, we have developed a particular scenario of the settlement of this debt. Under this scenario, we assume losses for the amount of reserves that we have created. If this scenario will change, we will revise our valuation. At the moment this is the sum of the losses that the VTB group will suffer for all products, the relationship with the company, if will be implemented scenario of bankruptcy,” added the MEP.
“This situation, unfortunately, or fortunately, still alive, she develops… the story so far, there are a lot of ways… the situation is quite heavy both for banks and for the economy,” concluded the MEP.
The court on October 19 filed a case on bankruptcy of “Transaero” at the request of the savings Bank. The validity of the claim of a major Russian Bank on implementation of the airline’s observation will be tested on 25 November. In bankruptcy proceedings came as VTB and Alfa-Bank.
Transaero airlines has been unable to service debts, which form together with the leasing obligations of about 250 billion rubles. Sale of tickets is stopped and passengers are transported group airlines “Aeroflot” and other carriers. The certificate of the operator Transaero withdrawn on 26 October.
As reported in October, the head of VTB Andrey Kostin on the verge of bankruptcy airline two months did not pay VTB leasing aircraft. Leasing debt “Transaero” in front of “VTB Leasing” is 40 billion rubles — the airline operated at that time, 21 plane group. Financial debt of “Transaero” before VTB is 12 billion rubles, of which 9 billion rubles under the state guarantees.