JSC Halyk Bank (HSBK)
JSC Halyk Bank: Consolidated financial results for the year ended 31 December 2022
13-March-2023 / 08:50 GMT/BST
The issuer is solely responsible for the content of this announcement.
March 13, 2023 Joint Stock Company ‘Halyk Savings Bank of Kazakhstan’ Consolidated financial results for the year ended 31 December 2022 Joint Stock Company ‘Halyk Savings Bank of Kazakhstan’ and its subsidiaries (together “the Bank”) (LSE: HSBK) releases consolidated financial statements and independent auditors’ report for the year ended 31 December 2022. Consolidated income statements KZT mln | 12M 2022 | 12M 2021 | Y-o-Y,% | 4Q 2022 | 4Q 2021 | Y-o-Y,% | Interest income | 1,247,644 | 879,865 | 41.8% | 360,190 | 242,490 | 48.5% | Interest expense | (577,445) | (366,792) | 57.4% | (171,203) | (111,126) | 54.1% | Net interest income before credit loss expense | 670,199 | 513,073 | 30.6% | 188,987 | 131,364 | 43.9% | Fee and commission income | 180,066 | 138,389 | 30.1% | 51,404 | 36,639 | 40.3% | Fee and commission expense | (96,274) | (71,789) | 34.1% | (25,309) | (20,015) | 26.5% | Net fee and commission income | 83,792 | 66,600 | 25.8% | 26,095 | 16,624 | 57.0% | Net insurance income (1) | 21,812 | 43,863 | (50.3%) | 16,417 | 13,429 | 22.3% | Net foreign exchange gain | 178,900 | 30,536 | 5.9x | 48,639 | 7,541 | 6.4x | Net (loss)/gain from derivative operations and securities (2) | (4,908) | 16,472 | (0.3x) | (13,532) | 5,665 | (2.4x) | Share in profit of associate, income on non-banking activities, other (expense)/income and loss on disposal of subsidiaries | 13,854 | 31,348 | (55.8%) | (25,472) | 18,057 | (1.4x) | (Credit loss expense)/recovery of credit loss expense (3) | (106,778) | 4,004 | (26.7x) | (12,069) | 9,477 | (1.3x) | Recovery of other credit loss expense/(other credit loss expense) | 78 | (4,002) | (101.9%) | 528 | (369) | (1.4x) | Operating expenses (4) | (198,100)(5) | (177,279)(6) | 11.7% | (51,950)(7) | (55,868)(8) | (7.0%) | Income tax expense | (105,097) | (62,237) | 68.9% | (40,987) | (16,637) | 2.5x | Net profit | 553,752 | 462,378 | 19.8% | 136,656 | 129,283 | 5.7% | Non-controlling interest | 1 | 1 | - | - | 1 | (100.0%) | Net profit attributable to common shareholders | 553,751 | 462,377 | 19.8% | 136,656 | 129,282 | 5.7% | | | | | | | | Net interest margin, p.a. | 5.6% | 5.2% | | 6.0% | 5.0% | | Return on average equity, p.a. | 31.7% | 29.7% | | 29.1% | 31.7% | | Return on average assets, p.a. | 4.1% | 4.2% | | 3.8% | 4.4% | | Cost-to-income ratio | 19.0% | 24.1% | | 19.1% | 27.9% | | Cost of risk on loans to customers, p.a. | 1.2% | 0.2% | | 0.4% | 0.2% | |
- Insurance underwriting income (gross insurance premiums written, net change in unearned insurance premiums, ceded reinsurance share) less insurance claims incurred and insurance agency commissions (insurance payments, insurance reserves expenses, commissions to agents);
- Net (loss)/gain on financial assets and liabilities at fair value through profit or loss and net realised (loss)/gain from financial assets at fair value through other comprehensive income;
- Total credit loss expense, including credit loss expense on loans to customers, amounts due from credit institutions, financial assets at FVTOCI, cash and cash equivalents and other assets;
- Including loss from impairment of non-financial assets and reversal of impairment loss of property, plant and equipment:
- KZT 4.1bn;
- KZT -5.8bn;
- KZT 4.2bn;
- KZT -5.6bn.
The net profit attributable to common shareholders amounted to KZT 553.8bn in 12M 2022, up 19.8% compared with KZT 462.4bn in 12M 2021 mainly due to significant increase in lending business, including acquisition of Sber’s loan portfolio, as well as increase in net gain on foreign exchange operations and net fee and commission income. The interest income for 12M 2022 increased by 41.8% vs. 12M 2021 mainly due to increase in average rate and balances of loans to customers. The interest expense for 12M 2022 increased by 57.4% vs. 12M 2021 mainly as a result of the growth in average rate and balances of amounts due to customers. Consequently, net interest income for 12M 2022 grew by 30.6% vs. 12M 2021. In 12M 2022, the net interest margin was affected by the increase in average rates on both loans to customers and amounts due to customers following the base rate hike from 10.25% to 16.75% in 12M 2022. Furthermore, the share of loans to customers in total interest-earning assets increased substantially. Moreover, there was an increase in the average rate and average balances of FX amounts due from credit institutions and FX interest-earning cash and cash equivalents following the global increase of USD interest rates. As a result, net interest margin increased to 5.6% p.a. for 12M 2022 compared to 5.2% p.a. for 12M 2021. The cost of risk on loans to customers for 12M 2022 was at 1.2% reflecting more normalized credit loss expenses on corporate and SME loan portfolio and higher credit loss expenses on retail loan portfolio. In 12M 2022, the overall dynamics of the fee and commission income and expense was driven by the increased transactional activity as a result of the clients inflow due to changes in the operating landscape. The net fee and commission income for 12M 2022 increased by 25.8% vs. 12M 2021 due to increase in net transactional income of both legal entities and individuals (9), as well as in fees on letters of credit and guarantees issued, which was mainly propped by the increase in overall volume of letters of credit and guarantees issued. Net foreign exchange gain increased by 5.9x for 12M 2022 vs. 12M 2021 mainly due to the volatility of exchange rates and interest rates, which resulted in significant growth in net dealing income. Other non-interest income (10) decreased by 81.3% for 12M 2022 vs. 12M 2021 mainly due to the loss and other related expenses on disposal of subsidiaries amid the sale of subsidiary banks in Tajikistan and Russia. The net insurance income (11) for 12M 2022 decreased by 50.3% year-on-year, due to increase in insurance reserve expenses on unsecured consumer loans with a borrower’s life insurance bundle. The operating expenses for 12M 2022 increased by 11.7% vs. 12M 2021 mainly due to the indexation of salaries and other employee benefits starting from March 1, 2022, the employee premiums reserve accrued in 12M 2022, as well as increase in charity expenses and IT investments. The cost-to-income ratio decreased to 19.0% compared to 24.1% for 12M 2021 amid higher operating income for 12M 2022. - Transactional income of individuals, less transactional expenses of individuals and less loyalty program bonuses;
- Other non-interest income (Net (loss)/gain on financial assets and liabilities at fair value through profit or loss, net realised (loss)/gain from financial assets at fair value through other comprehensive income, share in profit of associate, income on non-banking activities, other (expense)/income and loss on disposal of subsidiaries);
- Insurance underwriting income (gross insurance premiums written, net change in unearned insurance premiums, ceded reinsurance share) less insurance claims incurred, net of reinsurance (insurance payments, insurance reserves expenses, commissions to agents).
Statement of financial position review KZT mln |
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