Leading Russian financial group VTB Group published its Interim Condensed Consolidated Financial Statements as at 30 June 2013, along with the Independent Auditors' Report on Review of these Statements, on Thursday.
VTB's core income lines saw solid growth in the first half of 2013, with net interest income and fee and commission income up 33.7 percent and 17.4% percent year-on-year, respectively.
Net interest income growth during the period was driven primarily by the strong expansion of the group's loan book, including a 17. percent year-to-date increase in retail gross loans.
Retail banking and transaction banking continued to be key drivers of the group's fee and commission income growth during the first half, contributing $540 million and $276.9 million, or 57 percent and 29.1 percent, respectively, to the group's total net fee and commission income before inter-segment eliminations.
At the same time, the slowdown of Russia's GDP growth resulted in a year-on-year increase in VTB's cost of risk in both retail and corporate lending. The provision charge for impairment of debt financial assets increased year-on-year and was $1.55 billion compared to $992 million for the same period in 2012.
"VTB Group posted strong growth in its core income lines supported by the successful expansion of our corporate and retail businesses. At the same time, the Group's cost of risk was impacted by a challenging macroeconomic environment," VTB President and Chairman of the Management Board Andrey Kostin said. "We have responded to these headwinds by tightening origination policies and strengthening our debt collection function in our retail banking entities. We are also making significant progress on key long-term strategic initiatives, including developing our retail franchise, growth of lower-risk fee and commission-driven business lines, as well as the merger of TransCreditBank and continued integration of Bank of Moscow. Successful implementation of these initiatives, combined with the enhanced capital resources we have at hand, will enable us to build significant value to our shareholders."
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