Russian lender TCS increases loan growth forecast, Q2 profit up 36%

Russian retail lender TCS Group lifted its 2019 loan growth forecast 2019 to more than 60% on Tuesday, revising the key operating indicator for a third time this year from initially expected growth of 40%.

TCS says net profit up 36% y/y in Q2

TCS revises 2019 loan growth forecast higher

TCS confirms 2019 net profit forecast at above 35 bln roubles

Adds detail, quotes

MOSCOW, Aug 20 (Reuters) - Russian retail lender TCS Group TCSq.L lifted its 2019 loan growth forecast 2019 to more than 60% on Tuesday, revising the key operating indicator for a third time this year from initially expected growth of 40%.

Reporting second-quarter financial results, TCS, the parent of Tinkoff Bank, said net profit rose 36% year on year to 8.2 billion roubles ($122.4 million), up from 6 billion roubles in the second quarter of 2018.

The increase in net profit was driven by TCS' core credit business and growing revenue contributions from non-credit business lines, Oliver Hughes, CEO of Tinkoff Bank, said in the quarterly earnings report.

TCS said its net margin grew by 52% to 21.6 billion roubles in April-June. Net interest margin fell by 0.9 percentage points to 23.1% in the second quarter.

In the first six months of 2019, TCS's total assets increased by 20% to 452.1 billion roubles.

Looking forward, TCS expects its net interest margin to decline further amid lower interest rates in Russia, Ilya Pisemsky, CFO at Tinkoff Bank said at a conference call.

The Russian central bank has lowered its key rate twice this year and said more cuts were in the pipeline.

TCS also upgraded its year-end guidance for cost of risk to 7-8% from 6-7%, the financial report showed.

TCS confirmed it expected to make more than 35 billion roubles in net profit in the whole of 2019.

($1 = 67.0100 roubles)

(Reporting by Tatiana Voronova; writing by Anna Rzhevkina; editing by Andrey Ostroukh and David Evans)

((anna.rzhevkina@tr.com; +48 58 7720790))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More