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PRESS-RELEASE: RA «Expert-Rating» confirms the credit rating of PJSC «CREDIT AGRICOLE BANK» at the level uaAA+ following the results of 2011


15/03/2012

PRESS-RELEASE

(Translation from Russian)

RA «Expert-Rating» confirms the credit rating of PJSC «CREDIT AGRICOLE BANK» at the level uaAA+ following the results of 2011

March 13, 2012 RA «Expert-Rating» confirms the credit rating of PJSC «CREDIT AGRICOLE BANK» and the Bank’s bonds of Series A and B at the level uaAA+ according to the national scale. When confirming the credit rating, the Agency was guided by the results of Bank’s activity for 2011 (see Table 1).

Table 1

Key performance indicators of PJSC «CREDIT AGRICOLE BANK» (th. UAH, %)

Indicator

2011  

(01.01.2012)

2010

(01.01.2011)

Change, th. UAH, p.p.

Growth rate, %

Total assets

6 891 616

5 332 316

1 559 300

29,24

Cash and cash equivalents

1 110 047

781 923

328 124

41,96

Clients’ credits and debts

5 527 681

4 366 395

1 161 286

26,60

Loan provisions

(459 858)

(598 722)

(138 864)

(23,19)

Total liabilities

6 127 885

4 610 153

1 517 732

32,92

Commitments to other banks

2 105 683

1 370 726

734 957

53,62

Funds of legal entities

1 255 679

897 884

357 795

39,85

Funds of individuals

2 354 167

2 017 616

336 551

16,68

Shareholders’ equity

763 731

722 163

41 568

5,76

Net interest income

321 449

261 259

60 190

23,04

Net profit

45 964

(23 388)

Loan provisions / loan portfolio ratio

8,32%

13,71%

(5,39 p.p.)

-

Equity / Assets ratio

11,08%

13,54%

(2,46 p.p.)

-

ROE

6,02%

(3,24%)

-

-

Source: NBU data, calculations by RA «Expert-Rating»

Key factors, which affected the confirmation of rating:

1. In 2011 PJSC «CREDIT AGRICOLE BANK» has demonstrated good dynamics of development, as indicated by high growth rates of key indicators of its activity. Thus, Bank’s assets have increased by 29,24% or by UAH 1,6 bn over 2011, and as of 01.01.2012 have amounted to UAH 6,9 bn, while the average growth of assets of the Ukrainian banking system has constituted 11,91% for the same period. Liquid assets have increased by 41,96% and have equaled to UAH 1,1 bn following the results of the year that occupy 16,1% of Bank’s total assets. Bank’s loan portfolio has grown by UAH 1,2 bn or by 26,6% over the analyzed period (with the average market growth – 8,44%) and as of 01.01.2012 it has constituted UAH 5,5 bn. The increasing of Bank’s loan portfolio occurred in parallel with the improvement of its quality, which indirectly indicates the decrease in the need of forming the loan provisions, which have reduced by 23,19% or by UAH 138,9 mln over the 2011, and as of 01.01.2012 have amounted to UAH 459,9 mln. In the period from 01.01.2011 to 01.01.2012 the loan provisions/loan portfolio ratio has reduced by 5,39 p.p.: from 13,71% down to 8,32%, while the average of this indicator on the banking system has still remained at a rather high level of 18,16%.

2. As of 01.01.2012 Bank’s liabilities have amounted to UAH 6,1 bn that exceeds their volume more than by one third (by 32,92% or by UAH 1,5 bn) as of 01.01.2011. Positive dynamics of growth has been shown by all the components of the Bank’s resource base, attracted from external sources. At the same time, the highest growth has been demonstrated by funds raised from other banks, – 53,62% or UAH 735 mln. Funds of legal entities have increased by 39,85% or by UAH 357,8 mln, the growth of funds of individuals has amounted to 16,68% or UAH 336,6 mln. As of 01.01.2012 the structure of Bank’s liabilities has been as follows: funds of individuals have equaled to 38,4% (UAH 2,4 bn), funds of legal entities – 20,5% (UAH 1,3 bn), funds of other banks have accounted for 34,4% (UAH 2,1 bn) that, on the whole, indicate a good diversification of the Bank’s resource base.

3. Bank’s net profit has amounted to UAH 45,9 mln following the results of 2011, while a year before the Bank showed loss of UAH 23,4 mln. The Bank has succeeded to obtain positive financial result due to the growth of net interest income by 23,04% or by UAH 60,2 mln, as well as due to the decrease in deductions to formation of loan provisions by 23,19% or by UAH 138,9 mln. ROE of the Bank has amounted to 6,02% as of 01.01.2012.

4. As of 01.01.2012 Bank’s shareholders’ equity has constituted UAH 763,7 mln that is by UAH 41,6 mln or by 5,76% more, than as of 01.01.2011. Bank’s capital adequacy has reduced by 2,46 p.p. due to the outstripping paces of asset growth in comparison with equity growth, and as of 01.01.2012 this indicator has amounted to 11,08%. The Agency emphasizes that this decline of capital adequacy is the reflection of the Bank’s policy, aimed to the increase in efficiency of using its own funds, and doesn’t impair the level of its solvency.  

5. Results of 2011, which have been published by the group Crédit Agricole on 23.02.2012, indicate the enhancing of the Group’s role in the financial system of EU and of its proportion in the European market. Revenues of Crédit Agricole Group for the 2011 have exceeded EUR 35,129 bn, it is by 2,7% more, than in 2010. Gross operating income of Crédit Agricole Group has grown by 1,1% comparing to the 2010. Despite the growth in indicators of business activity and the effect of operating activities, operating income of the Group has reduced by 16,8% over the 2011, and pre-tax profit – by 40% in comparison with the same indicators of 2010. Activity of Crédit Agricole Group in 2011 has remained profitable, although pre-tax income and operating income have reduced because of the need to increase the reserves for the taken risks. Crédit Agricole Group explains the rise in cost of risk by 29,2%, basing on the EU’s plans to help Greece. (see Table 2).

Table 2

Consolidated results of Crédit Agricole Group

following the results of 2011 (bn EUR, %)

Indicators

2011

Growth rate 2010-2011

Revenues

35,129

+2,7%

Operating expenses

21,629

+3,7%

Gross operating income

13,500

+1,1%

Cost of Risk

6,708

+29,2%

Operating income

6,792

-16,8%

pre-tax income

3,964

-40,0%

Source: Crédit Agricole Group consolidated results

Therefore, PJSC «CREDIT AGRICOLE BANK» has demonstrated excellent dynamics of development following the results of 2011, comparing to the results of 2010. The Bank has increased its portfolios of liabilities and assets by one third over the given year, while the average growth of these indicators of the Ukrainian banking system has fluctuated approximately at 11-12%. Bank’s withdrawal form the loss-making state and demonstration of rather significant profit have become the result of increase in loan portfolio against the background of improvement of its quality, while increasing its net interest income. At the same time, the Bank confidently maintains indicators of liquidity and solvency at the adequate level that is the guarantee of timely performing the undertaken liabilities. Activity of Crédit Agricole Group in 2011 has remained profitable and, in the Agency’s opinion, the Group has been able to provide almost unlimited external support to its business in Ukraine.

 Analytical service of RA «Expert-Rating»

 

Confirmation of PJSC «CREDIT AGRICOLE BANK» (english version) - 13.03.2012

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