Alfa-Bank's financial performance

Main article: Alfa-Bank

2023:118 billion rubles of net profit

In 2023, Alfa-Bank earned 118 billion rubles of net profit under RAS, while a year earlier the credit institution reported net losses of 117.1 billion rubles. The bank spoke about the results of work in 2023 on January 30, 2024.

Alfa-Bank's website reports that in 2023, the bank's assets grew by 45%. Thus, the corporate loan portfolio added 51%, and the retail portfolio - 40%. The deposit portfolio also showed an increase of 46% due to an increase in the volume of funds of individuals by 53% and legal entities - by 40%.

source = Alfa-Bank

The bank also points to an increase in the customer base of 4.6 million people at the end of 2023. The number of its retail clients of the credit institution increased to 30 million customers. The customer base of small and medium-sized businesses (SMEs) increased by almost a quarter and reached 1.6 million people. According to the chief managing director of Alfa-Bank Vladimir Verkhoshinsky, this is due to the "expansion of phygital branches into the regions." By the end of 2023, the bank had more than 700 phygital branches throughout Russia.

At the end of 2023, Alfa-Bank showed significant growth not only in net profit, but also in the client base, - comments Vladimir Verkhoshinsky. - Our digital solutions continue to occupy the first lines of Markswebb ratings by an even greater margin from competitors. Such growth and development became possible primarily due to the well-coordinated work of the entire team. In 2023, Alfa-Bank became the leader of all major ratings among the best employers in Russia. We continue to actively invest in technology, in service and in people.

In 2023, Alfa-Bank announced its readiness to enter the Vietnamese market. In addition, according to RBC, the bank considered expanding its business in China.^[1]

2022: Losses of 117.1 billion rubles

Alfa-Bank's net loss under RAS in 2022 reached 117.1 billion rubles, while a year earlier net profit was recorded at 136.6 billion rubles. The reporting of the credit institution was released in early April 2023.

The last time the bank showed a negative financial result in 2009, then it amounted to 3.35 billion rubles. As RBC notes, both before and after that, it remained profitable, for example, at the end of 2021, Alfa-Bank earned 136.6 billion rubles.

Net loss of Alfa-Bank under RAS in 2022 reached 117.1 billion rubles

In the first half of 2022, the bank recorded a one-time loss due to the fact that part of the assets in foreign currency was frozen, in addition, the currency revaluation had an impact on the financial result and reporting under RAS, "Vladimir Verkhoshinsky, Chief Managing Director of Alfa-Bank, explained to the publication.

Net interest income of Alfa-Bank in 2022 amounted to 211.7 billion rubles, and commission - 160.4 billion rubles, while reservation costs increased to 167.4 billion rubles.

In 2022, the growth of the bank's retail loan portfolio exceeded 20%, and the portfolio of small and medium-sized businesses - 30%. The retail customer base over the past year increased to 26 million people (+ 17%), and the corporate customer base - to 1.3 million companies (+ 24%).

The publication notes that in 2022 Alfa-Bank did not experience problems with capital: its ratio of sufficiency of own funds (N1.0) at the end of 2022 was at the level of 14.07%, having decreased over four quarters by only 0.3 percentage points (pp). The requirements of the Central Bank, taking into account Basel allowances for this indicator, are 11.5% for systemically important credit institutions. The basic capital adequacy ratio (N1.1) of Alfa-Bank in 2022 increased by 0.7 pp to 11% (the required level, taking into account allowances - 8%). The fixed capital adequacy ratio (N1.2) remained practically unchanged at 12.1%.^[2]

2021: Net profit growth 20% to $1.61 billion

On February 21, 2022, Alfa-Bank reported a record net profit of $1.61 billion. The growth compared to 2020 was 20% (in ruble terms - 22%). At the same time, total total income grew by 74% to $1.573 billion. The capital of the banking group for the reporting period increased by 21.8% to $10.559 billion. Return on equity was 16.7%.

Alfa-Bank in 2021 increased its net profit by 20%
Photo: finclub.net

Thanks to the continued growth of the client base, net commission income increased by 38.4% in 2021 and amounted to $1.718 billion. In ruble terms, the growth was 41.3%. The share of net commission income in operating profit before the creation of reserves (including total income) at the end of 2021 amounted to 40.4%. The bank fully covers its operating expenses with risk-free commission income. At the end of 2021, net commission income coverage of the bank's operating expenses amounted to 100.1%, which ensures the stability of its business model.

Net interest income increased to $2.377 billion, showing an increase of 9.5% in dollar terms or 11.8% in ruble terms. In the context of declining interest rates, as well as taking into account the active increase in the mortgage portfolio, the net interest margin (NIM) decreased to 4.0%.

The loan portfolio before provisions increased by 21.7% to $51.985 billion compared to $42.714 billion at the end of 2020 (an increase of 22.2% excluding currency revaluation). The corporate loan portfolio grew by 12.0% to $34.717 billion (an increase of 12.4% excluding currency revaluation). The retail loan portfolio increased by 47.5% and amounted to $17.268 billion (an increase of 48.3% excluding currency revaluation). The quality of the loan portfolio improved at the end of the year. The share of third-stage corporate loans in the portfolio decreased to 1.6% from 3.7% at the beginning of the year. The share of bad retail loans decreased to 3.1% from 5.0% at the beginning of the year.

According to Alfa-Bank, the organization holds the third place in the retail lending market. Market share increased to 5.1% compared to 4.3% in 2020. The share in the corporate lending market increased to 4.8%.

The most active growth was in mortgage lending - 83% in ruble terms compared to the beginning of the year. Alfa-Bank rose from seventh to third place in Russia in terms of mortgage portfolio at the end of 2021.

Credit card market share rose to 11.9%, up from 11.4% at the start of the year.

The number of retail clients of Alfa-Bank grew to 22 million people, an increase of 4 million people in 2021. The volume of the client base of small and medium-sized businesses exceeded 1 million customers. The number of brokerage clients of the Alfa-Investments application increased 4 times compared to the beginning of 2021 to 1.7 million.

The share in the market for attracting funds of individuals increased to 5.4% from 4.5% at the beginning of the year, the share in the market for current attraction increased to 10.8% from 9.9% at the beginning of the year. Customer funds increased by 30.3% to 56.933 billion (an increase of 30.8% excluding currency revaluation). At the same time, the share of current accounts in customer funds amounted to 63.4% at the end of 2021, which ensures the stability of the funding base and its low value. The CIR performance indicator was 40% against the background of active growth in the bank's business.

The total assets of the Alfa-Bank banking group amounted to $75.882 billion at the end of 2021, showing an increase of 22.7% since the beginning of the year (excluding currency revaluation, asset growth amounted to 23.1%).

Group liabilities increased by 22.8% to $65.323 billion at the end of 2021 (by 23.3% excluding currency revaluation).

"In 2021, we not only fulfilled the previous strategy ahead of schedule, but were not afraid to take on a new super ambition. We chose the path of "financial superservice" and focused on how to best understand customer needs. A year has passed - and the results speak for themselves. We have increased our retail customer base by 4 million, to 22 million people. For the first time, the volume of the client base of small and medium-sized businesses exceeded 1 million customers. The number of clients of the brokerage business has grown 4 times, "summed up the year, Alfa-Bank CEO Vladimir Verkhoshinsky.

Alfa-Bank Group's financial results are compiled in accordance with international financial reporting standards and audited by PwC.

2019: Net profit almost halved to $704m

In 2019, Alfa-Bank received a net profit of $704 million against $1.321 billion in profit a year earlier. The decline in profits in the credit institution was associated primarily with currency fluctuations.

Total comprehensive income (including net income and other comprehensive income) increased more than 1.5 times to $1.03 billion (compared  with $697 million in 2018 ). The loan portfolio before provisions increased by 30.3% and reached $39.8 billion, the corporate loan portfolio showed an increase of 20%, to $29.4 billion, and the retail portfolio - by 71.9%, to $10.4 billion.

Alfa-Bank's net profit in 2019 fell by half

In 2019, Alfa-Bank attracted about 1 million new individual clients and 96 thousand small and medium-sized businesses. The share of overdue loans (90 + days) amounted to 1.4%  as of December 31, 2019. Coverage of overdue loans with reserves amounted to 215.3%.

Net interest income exceeded $2.2 billion, showing 15.5% growth in ruble equivalent. Net commission income increased by 10.2% to $1.04 billion. The share of net commission income in operating income before provisions rose to 35.1%, while coverage of the bank's operating expenses reached 79.2%.

Alfa-Bank's reporting also states that customer funds for 2019 increased by 29%, to $41.4 billion. The capital of the banking group increased by 12.5%, to $8.1 billion. The successful placement of subordinated perpetual bonds in rubles for 5 billion rubles and subordinated Eurobonds totaling $850 million made it possible to strengthen its capital position, the credit institution noted.

Alfa-Bank's liabilities increased by 28.3%, to $51.3 billion,  by December 31, 2019 (an increase of 18.4% excluding currency revaluation). Customer funds increased by 29%, to $41.4 billion (+ 18.7% excluding currency revaluation). Alfa-Bank Financial Statements

2017: Bank and subsidiaries net income growth by 50% to $798 million

Alfa-Bank Banking Group , which includes ABH Financial, Alfa-Bank JSC and subsidiaries, earned  $798 million in 2017. US net income. This figure increased 1.5 times compared to 2016, the press service of the credit institution^[3].

In addition, net interest income increased by 26.9% to   $1,739 million. US by outperforming interest income growth amid lower interest rates. The net interest margin (NIM) was 4.7%, higher than in 2016 .

An increase in the quality of the loan portfolio was also recorded. The share of overdue loans (90 + days) decreased from 4.2% at the beginning of the year to 2.3%. Coverage of overdue loans (90 + days) with reserves remains conservatively high at 122.8%. The reserve rate at the end of 2017 was 2.9%.

" In 2017, Alfa-Bank again demonstrated qualitative positive dynamics in terms of key financial performance indicators and confirmed the leading position of the country's largest private bank. Thanks to the well-coordinated work of the entire bank, we expanded our customer base, increased lending, especially in the retail segment, while improving the quality of assets. During the year, we saw a significant inflow of client funds, and, taking this opportunity, I want to thank all customers for their trust and choice of our bank. In the coming year, we will try to do even more for all our clients, actively continuing our strategy of active growth, "commented Alexey Chukhlov, Deputy Chairman of the Management Board, Acting Chief Managing Director and Chief Financial Officer

 According to the results of 2017, the Alfa-Bank banking group took the position of the largest Russian private bank in terms of total assets, total capital, credit and deposit portfolios.

2016: Net income growth of 9.8% to $527m

Net profit of the Banking Group increased by 9.8% compared to 2015 and reached 527 million dollars USA (compared to $480 million in 2015).

In 2016, there was a recovery in net interest margin due to lower funding costs. Net interest income increased by 3.6% to US $1,325 million, with an increase of 13.9% in ruble terms. Net interest margin (NIM) increased from 4.0% to 4.5% in 2016.

The risk value of Alfa-Bank Group significantly improved, decreasing from 3.12% to 1.30% due to a significant improvement in the quality of the loan portfolio. The share of overdue loans (90 + days) decreased to 4.2% from 6.9% as of December 31, 2015. Coverage of overdue loans (90 + days) with reserves remains conservatively high at 113.1%. The reserve rate at the end of 2016 was 4.8%.

Due to the growth of the customer base, net commission income increased by 8.4%, and in ruble terms by 19.2% compared to the same period last year, and amounted to 634 million US dollars. The share of net commission income in operating income before provisions reached a record 32.0% at the end of 2016, reflecting the bank's strategy to increase stable risk-free income and strengthen the role of the transactional business.

Total assets of Alfa-Bank Banking Group increased by 21.5% year-on-year to USD 38,247 million as of December 31, 2016. Excluding the exchange rate effect associated with the strengthening of the ruble by 16.8% in 2016, asset growth amounted to 11.9%.

The pre-reserve loan portfolio increased by 10.4% to $23,901 million compared to $21,654 million at the end of 2015. During the year, the Group maintained an approach aimed at maintaining the quality of its loan portfolio by lending to the most reliable borrowers.

Alfa-Bank Group's liabilities amounted to USD 32,513 million as at 31 December 2016. Customer funds increased in dollar terms by 22.4% to $21,721 million (excluding exchange rate effect - by 10.3%). At the same time, the volume of current accounts increased by one and a half times (+ 49.8%), and their share in customer funds amounted to 50.7%, which indicates a high confidence of clients in the Banking Group as one of the most reliable financial institutions in Russia.

Alfa-Bank Group's capital grew by 32.0% to US $5,734 million from US $4,344 million at the end of 2015. This growth was ensured, among other things, by the issuance of perpetual Eurobonds totaling 700 million US dollars - a unique transaction on the Russian market. After the introduction of Basel III standards, no one from Russia posted public issues of perpetual Eurobonds. Capital indicators according to Basel I standards are maintained at a high level: the capital adequacy ratios of the total capital and capital of the 1st level were 21.8% and 16.2%, respectively, which guarantees the stability and stability of the Banking Group even in difficult economic realities.

Alfa-Bank Banking Group maintains the position of one of the largest Russian private banks in terms of total assets, total capital, credit and deposit portfolios. In 2016, the Banking Group managed to significantly strengthen its market position in all areas of activity:

• market share by retail customer funds "on demand" rose to a historically record level of 9.09% from 8.17% at the beginning of the year;
• corporate lending market share rose to 3.46% compared to 3.18% at the beginning of the year;
• The number of customers of mass corporate business increased by 32.9% from 217,000 to 288,000 customers.

2015: 15-fold increase in net income to $480 million

The Banking Group's net profit increased by 15 times compared to 2014 and reached 480 million dollars USA (compared to US $33 million in 2014). Operating profit before provision amounted to US $2,257 million (a decrease of 12.9% compared to 2014 is due to a weakening of the average exchange rate - ruble by 58.7% for the year). In rouble terms, operating profit before provision increased by more than a third (+ 38.2%) in 2015.

A sharp increase in the key rate since the end of 2014 and a significant weakening of the ruble exchange rate had a significant negative impact on interest margin. Net interest income of the Alfa-Bank Banking Group decreased by 40.7% to US $1,321 million, although the decrease in ruble terms was only 5.8%.

Provisions for possible loan losses decreased to $777 million in 2015, compared to $1,228 million in 2014.

In 2015, Alfa-Bank Group's risk value decreased from 3.96% to 3.12% due to a decrease in the growth rate of problem debt. At the same time, the traditionally conservative approach in risk analysis was reflected in an increase in the reservation rate from 5.8% to 6.5%.

Net commission income amounted to US $585 million: a decrease of 29.1% compared to last year is due solely to the weakening of the ruble, since in ruble terms the increase was 12.5%. The share of net commission income in operating profit before provision creation remains consistently high at more than 25%.

Positive dynamics in the securities market and volatility in the foreign exchange market allowed Alfa-Bank Banking Group to receive significant income on securities, derivatives and foreign currency transactions in the amount of US $334 million in 2015.

Alfa-Bank Bank Group demonstrated better operating efficiency in 2015, with the operating expense-to-income ratio decreasing from 45.8% to 43.0%. Operating expenses decreased by 18.1% to US $971 million in 2015 compared to US $1,186 million in 2014, primarily due to a reduction in personnel costs.

Total assets of Alfa-Bank Banking Group amounted to US $31,470 million as of December 31, 2015, a decrease of 27.8% in dollar terms compared to US $43,566 million as of December 31, 2014, due to the weakening of the ruble by 29.5%. Excluding the exchange rate effect, the decrease was 19.3%.

The pre-reserve loan portfolio decreased by 23.0% to US $21,654 million compared to US $28,105 million at the end of 2014, with a decrease of 12.4% excluding the exchange rate effect. The reduction in the loan portfolio is due not only to a decrease in the economic activity of the population and enterprises, but also to the Bank's strategy aimed at maintaining the quality of the loan portfolio. The loan portfolio of corporate clients amounted to $18,940 million at the end of 2015, a decrease of 19.5% compared to $23,532 million at the end of 2014 (a decrease of 10.2% excluding the exchange rate effect). The retail loan portfolio shrank to US $2,714 million, or 40.7% year-on-year (a 24.0% decrease excluding the exchange rate effect).

The dynamics of the quality indicators of the loan portfolio is comparable to the trends of the banking sector. The share of overdue loans (90 + days) amounted to 6.9% as of December 31, 2015 compared to 2.7% at the end of 2014. Coverage of overdue loans (90 + days) with reserves remains conservatively high at 94.3%.

Alfa-Bank Group's liabilities amounted to $27,126 million as of December 31, 2015. Customer funds decreased in dollar terms by 11.5% to US $17,748 million, which is due to the depreciation of the ruble (excluding the exchange rate effect, customer funds increased by 2.6%).

Alfa-Bank Group's capital grew to US $4,344 million from US $4,296 million at the end of 2014. Capital indicators according to Basel I standards are maintained at a high level: the adequacy ratios of total capital and capital of the 1st level increased each by 4.0 pp to 21.7%, and 16.8%, respectively.

Alfa-Bank Banking Group maintains the position of one of the largest Russian private banks in terms of total assets, total capital, credit and deposit portfolios. In a difficult economic context, the Banking Group managed to strengthen its market position in all areas of its activities:

• the average market share for retail customers "on-demand funds in 2015 increased from 7.24% to a historically record level of 8.10%;
• average share in the corporate lending market increased from 3.18% to 3.24%;
• The number of mass corporate business customers grew from 140,000 to 217,000 customers.

In 2015, Alfa-Bank Bank Group confirmed that it has access to international capital markets and continues to enjoy stable investor support. In November 2015, Alfa-Bank Bank Group successfully placed three-year Eurobonds totaling US $500 million with the lowest rate in the history of Russian private banks - 5.00%. This issue was the first significant public placement of Eurobonds of the Russian financial institution in the primary market in 2015 after the revision of the attitude towards Russian country risk by the international financial community since 2014.

Financial Alfa-Bank Group's results are compiled in accordance with international financial reporting standards and reviewed by the company's auditors. PriceWaterhouseCoopers

2014: Net profit falls 27 times to $33m

Alfa-Bank's net profit fell 27 times to $33 million. The bank's profit before the creation of reserves fell by 16.4%, to $2.591 billion, compared to 2013. Net interest income fell 2.8% to $2.226 billion^[4] financial^[5].

The main components of operating profit are net interest income, which decreased by 2.8% to 2,226 million dollars USA(in rouble terms, there was an increase of 17.2%) and net commission income, which increased by 5.8% to $825 million (in rouble terms, an increase of 27.5%). The share of net commission income in the Group's operating income before provision increased to 31.8% at the end of 2014 compared to 25.2% at the end of 2013.

The bank's customer funds fell by 25%, to $20.059 billion, the volume of personal funds fell by 16%, to $12.056 billion.

Alfa-Bank's claims for bankruptcy of its subsidiary UTair were left without movement.

2009: Total assets $21.6 billion

According to the audited financial statements () IFRS for 2009, the total assets of Alfa-Bank Group, Russia which includes Alfa-Bank OJSC, subsidiaries banks and financial companies, amounted to 21.6 billion, dollars the value of the gross loan portfolio - 15.0 billion dollars, the total equity - 2.7 billion dollars.

Net profit after tax attributable to the equity capital of Alfa-Bank Russia Group amounted to $88 million.

Notes