Key results:

- the Bank’s total assets grew by 27.1% to RUB 117,138 mln compared to the beginning of the year

- net profit for the nine months of 2013 increased by 2.2% (or RUB 49 mln) to RUB 2,276 mln compared to the same period of 2012

- return on average equity (ROAE) was 24.2% as of 9 months 2013, return on average assets (ROAA) was 2.9%, cost-to-income ratio was 41.6%

- current accounts and deposits from customers increased by 22.1% ytd to RUB 79,536 mln

- the Bank’s equity increased by 17.8% ytd and reached RUB 13,586 mln as of the reporting date

Net profit of the Bank as for the first 9 months of 2013 grew by 2.2% yoy to RUB 2,276 mln. The main driver of the net profit growth in 2013 compared to 2012 is expanding lending operations and following increase of the net interest income as well as growth of fee and commission income. Net interest income as for the 9 months 2013 grew by 33.7% yoy to RUB 5,975 mln. Net fee and commission income increased by 67.3% to RUB 2,290 mln. As in the first half of 2013, growth of the net fee and commission income was driven by increase in insurance agent commissions by 140.4% (as for the 9 months 2013 compared to 9 months 2012) to RUB 1,249 mln and settlement operations fees by 21.8% to RUB 944 mln. Impairment losses for the 9 months 2013 reached RUB 2,896 mln, which is more than 2 times higher than in the 9 months 2012, which is the reason for the net profit growth to be significantly lower than the net interest and commission income growth.

Due to the growth of impairment losses during 9 months of 2013 cost of risk reached 5.4% compared to 3.4% in 2012, which resulted in a reduction of the Bank’s profitability ratios(which are still higher than market averages): return on average equity (ROAE) was 24.2% while return on average assets (ROAA) was 2.9% (32.2% and 4.3% as of YE 2012 respectively). Level of the net interest margin was 10.4% (compared to 11.7% as of YE 2012).

Operating income of the Bank as for the 9 months of 2013 grew by 42.0% yoy to RUB 9,819 mln, operating expenses grew by 37.9% to 4,087 mln due to growth of infrastructure development and personnel expenses. Cost-to-income ratio reduced to 41.6% from to 42.9% as of the 9 months 2012.

Gross loan portfolio (before provision for loan impairment) grew by 28.8% to RUB 79,092 mln compared to the beginning of the year. Portfolio of loans to individuals rose by 27.3% to RUB 55,068 mln (69.6% of the loan portfolio) and portfolio of loans to corporate clients and individual entrepreneurs grew by 32.6% to RUB 24,024 mln. Share of NPLs (loans overdue more than 90 days) in the loan portfolio grew to 7.4% as of the reporting date compared to 5.8% as of YE 2012; the level of corporate loan portfolio NPLs is 3.0% and the level of retail loan portfolio NPLs is 9.3%. The level of provision coverage of NPLs increased to 84.6% compared to 81.7% as of YE 2012.

Loan to deposit ratio was 93.2% as of October 1, 2013. Growth of the loan portfolio was supported by increase in accounts and deposits of customers which grew by 22.1% ytd to RUB 79,536 mln. In particular, demand accounts of corporate customers grew by 62.8% ytd to RUB 19,514 mln and term deposits of retail customers grew by 14.7% to RUB 45,038 mln.

Securities portfolio representing 17.9% of the assets, increased by 32.3% ytd to RUB 20,923 mln. Asian-Pacific Bank adheres to conservative investment policy; major part of the portfolio of securities is government and municipal bonds as well as corporate bonds from the Central Bank of Russia’s Lombard List (98% of the bond portfolio).

The Bank’s equity calculated in accordance with the Basel Accord reached RUB 14,514 mln (16.6% ytd growth). Tier 1 capital adequacy ratio was 12.5% and Total capital adequacy ratio was 14.8%.

Ratings

Asian-Pacific Bank’s positions in the Russian and international markets are confirmed by the leading rating agencies:

- long-term foreign and local currency issuer default rating (IDR) B+, short-term foreign currency IDR B by Fitch

- viability rating b+ and support rating 5 by Fitch

- long-term foreign and local currency deposit ratings B2 by Moody`s

- standalone E+ bank financial strength rating (BFSR) and Not Prime short-term bank deposit ratings by Moody`s

- bank credit rating A+ by Expert RA.

Key financials (RUB mln)

Key ratios (%)