TCS, owner of Russia’s Tinkoff Bank, sees H1 profit drop

By Alexander Marrow

MOSCOW (Reuters) -TCS Group Holding’s first-half web revenue dropped to a five-year low, hit by greater funding prices and conservative provisioning, the proprietor of Russian on-line financial institution Tinkoff mentioned on Wednesday.

The group didn’t present exact figures for a lot of metrics. In early March, days after Moscow despatched troops into Ukraine, the Financial institution of Russia informed Russian banks they need to not publish sure monetary statements, searching for to restrict dangers to credit score companies related to the imposition of Western sanctions.

“In H1, web revenue decreased considerably 12 months on 12 months, implying single-digit return on fairness,” TCS mentioned in a submitting.

Return on fairness for a similar interval of final 12 months was 44.7%.

TCS’s Moscow-listed depositary receipts had been down 5% at 1523 GMT. Buying and selling in its London-listed world depositary receipts was suspended in early March.

TCS mentioned Tinkoff’s buyer numbers rose to 24.3 million, practically 8 million greater than a 12 months in the past, which it mentioned supported double-digit development in quarterly income.

The financial institution mentioned curiosity revenue elevated by 31% 12 months on 12 months to 52.2 billion roubles ($872.9 million), however its web curiosity margin fell by a single-digit proportion.

The rise in TCS’ price of danger was just like that at first of the COVID-19 pandemic within the first half of 2020, it added.

Shortly earlier than the battle in Ukraine, Tinkoff was gearing as much as broaden in southeast Asia, earmarking as much as $200 million for the drive, partnering with a cost options supplier within the Philippines and talking to regulators in different nations.

However, as for a lot of Russian companies, the previous six months have been turbulent. TCS has gone quiet on its Asia plans.

TCS mentioned it had a major liquidity cushion and ample capital buffers that might assist it to “adapt additional to the altering surroundings in 2022”.

The lender has not been straight focused with sanctions, however Tinkoff has flagged points in conducting SWIFT transactions since main Russian banks had been minimize off from the messaging system underpinning world monetary transactions.

The group ringfenced its Russian enterprise in April, transferring shareholder’s authority over Tinkoff Financial institution to its Russian administration crew.

Weeks later, TCS founder Oleg Tinkov offered his 35% stake to an organization managed by Russian billionaire Vladimir Potanin quickly after criticising Moscow’s actions in Ukraine.

($1 = 59.8000 roubles)

(Reporting by Alexander MarrowEditing by David Goodman and Mark Potter)