6th Mar 2007 08:57
JSC Halyk Savings Bank Kazakhstan06 March 2007 Press Release Major Results of Performance of Halyk Bank in 2006 Almaty, 6 March 2007 - Mr.Grigoriy Marchenko, Chairman of the Management Boardof Halyk Bank, announced preliminary results of the Bank's performance in 2006based on unaudited consolidated financial statements. These financial statementshave not yet been confirmed by an external auditor nor approved by the Board ofDirectors and General Shareholders Meeting of the Bank. The final reports for2006 shall be published towards the end of March 2007. Successful IPO on the London Stock Exchange, membership with the ISDA(International Swaps and Derivatives Association, Inc.), issuance and acquiringCUP (China UnionPay) payment cards and successful Eurobond offering are amongthe Bank's most important achievements last year. Also in 2006 Euromoney magazine named Halyk Bank "The Best Bank in Kazakhstan in2006", while the Banker included Halyk Bank to the top 1,000 banks by Tier Icapital in the world, where the Bank is number 658. Halyk Group's key financial indicators as per preliminary IFRS accounts. Lastyear Halyk Group's net profit reached 25.7 billion Tenge having increased 65 percent. The Bank's net profit on an unconsolidated basis amounted to 20.7 billionTenge. Its consolidated Total Assets amounted 987.4 billion Tenge showing 76.4per cent growth ratio. Shareholders' Equity as of 1 January 2007 stood at 119.6billion Tenge after 86 per cent increase. In 2006 the Bank's ROAA was 3.49 percent, ROAE - 32.83 per cent and Net Interest Margin - 6.83 per cent. The Bank remains undisputed leader in terms of issued payment cards, the numberof which is more than 2.8 million. In 2006 Halyk Bank was first in Kazakhstan toissue new high class product - VISA Infinite. Nowadays more than 130,000 customers use "Mobile Banking" service, which is themost in-demand remote banking service in the country. Last year the income fromthe service made 168.2 million Tenge. Income from "Internet-Banking" serviceincreased in 2006 in comparison with the previous year by 6.7 per cent to reach57.2 million Tenge. The Bank is rendering services to its customers through its network of 593branches and divisions, including regional and district branches in all 14oblasts of Kazakhstan, as well as through the most extensive network ofapproximately 1,000 ATMs. The total number of retail customers of the Bank ismore than 5.9 million (the biggest client base in Kazakhstan), approximatley 62thousand SME customers and more than 300 big corporate customers. Year 2006 was marked for its large charity projects under the Halyk Bank'ssocial responsibility campaign. Total amount of funds spent on charity andsponsorship exceeded 63 million Tenge. Halyk Bank's Press Service Ainur Issabayeva, Tel. 007 3272 590 000, ext.1498 Reference Information IPO On December 20, 2006 the Bank successfully completed its IPO of GlobalDepositary Receipts (GDR) on the London Stock Exchange, each GDR representingfour common shares. Multiple oversubscription resulted in upward price reviseaction and final pricing on December 14, 2006 at the upper end of the pricerange of US$16 per GDR. Total of 46,750,000 GDRs were offered for the totalconsideration of US$748 million, of which US$220 million will represent the newRights Issue proceeds of the Bank. The Bank's post-money market capitalizationat IPO price was US$3.9 billion. Immediately after commencement of conditionaldealings, the price per GDR increased up to US$20.9, while as at December 31,2006 it reached US$22.0, thereby increasing market capitalization up to US$5.4billion. Eurobonds On May 11, 2006 the Bank successfully closed its US$300 million 7-year Eurobondsin the international capital markets. By the end of May 2006 spreads on theBank's both outstanding Eurobond issues, due 2009 and 2013, tightenedsignificantly and Halyk bank's papers trade since then at the tightest yieldcurve among Kazakhstani commercial banks. Membership in ISDA In 2006 the Bank cemented its leading positions on forex and governmentsecurities markets, by holding number one position three years in a row in forexmarket and two years in government securities market on Kazakhstan StockExchange. Leading positions on basic markets enabled the Bank to become in 2006number one choice counterpartner for Kazakhstani corporates and internationalbanks for liquidity management and forex risk management purposes. In 2006 the Bank strengthened its position on derivative financial instrumentsmarket. Hence, the Bank had decided to join the ISDA Association (InternationalSwaps and Derivatives Association, Inc.). ISDA represents interests ofderivative financial instruments market participants and is the biggest globalfinancial and trading association in terms of number of members. Sinceestablishment the Association targeted identification and mitigation of risksattributable both to derivative instruments and risk management activities. On 22 January 2007, by Resolution of the ISDA Board of Directors Halyk Bank wasaccepted as a Primary Member of the Association. The Bank was the first bank inKazakhstan and the second bank in CIS to become a Primary Member of ISDA. It isworth mentioning that membership procedures imply that one of the members of theISDA Board of Directors acts as a guarantor for the candidate bank. Retail Business Historically Halyk Bank is the leader in the retail banking of Kazakhstan. As ofthe year end 2006 the Bank's retail deposits in Kazakhstan amounted 207.2billion Tenge having increased by 76.3 billion Tenge. Total deposit baseincludes 153.3 billion Tenge of term deposits and and approximately 54 billionTenge of demand deposits. The Bank's retail deposits market share in Kazakhstanwas equal to 21 per cent. The most popular deposits were "Narodniy-Pensionniy","Narodniy-Standartniy" and "Halyk-Universalniy". As at December 31, 2006 the Bank's retail loan portfolio in Kazakhstan amountedto 148.4 billion Tenge, having increased by 63.5 billion Tenge. The Bank's sharein the bank mortgage lending in Kazakhstan was equal to 27 per cent. As of 1 January 2007 Halyk Bank had 68 branches equipped with electronicqueueing system. The Bank plans to equip another 50 branches with such system bythe end of 2007. In 2006 new retail products and lending programs were introduced, such as:Mortgage Bonus, Auto Lights, Own Mortgage, Educational Loan, Emergency RevolvingCredit, New Mortgage, etc. SME market is one of the most dynamic segments of the banking sector inKazakhstan. Halyk Bank, developing as a diversified regional financial group "Halyk Group", focuses greatly on the development of small and medium businessesin Kazakhstan. Implementation of different new products and services for SMEsegment, cooperation with EBRD and support of domestic rural sector are theevidence thereto. Small business loan portfolio as of the year end 2006 reached 53.9 billionTenge. The most popular loan programs are "Business-Lights 3", "Business-Universal", "Business-Small 2" and Small business lending program under thecredit line of the European Bank for Reconstruction and Development. Twoprograms were modified in 2006: "Business-Lights" and "Business-Small" byextending the tenor for some loans. The new programs launched in 2006 are "Business-Hypothec Lights", "Business-Contract", "Business-Deposit" and "Halyk-Bidai". Loans extended to medium business amounted to 39.1 billion Tenge as of the yearend 2006. The most popular lending programs are "Business-Medium", "LeasingClassic", "Halyk Agro" and "Super Lights". During the year the Banksignificantly improved and simplied the granting procedures of its lendingprograms. Card Business Halyk Bank is the leader in the domestic market of payment cards as the numberof cards issued exceeds 2.8 million. The range of card products and services offered has been significantly expandedin 2006: - a holder of China UnionPay card (of which there are more than 1billion globally) can withdraw cash via Halyk Bank's ATMs and request balance ontheir card. In December of the last year the Bank was the first in the world toissue CUP payment cards; - Halyk Bank was the first to issue a new high class product - "VISAInfinite". Holders of "Visa Infinite" payment card join the global discountprogram which allows them to receive discounts and specially selected privilegesaround the world: in luxury hotels, exclusive shops, in fashion shows,restaurants, car, yacht or boat rental agencies and others. When using "Visa Infinite" card customer receives access to concierge servicesaround the world (assistance in organization of trips, reservation of hotels,airway tickets, tickets for cultural and sport events, delivery of documents andpresents etc.), to 24-hour International SOS service (medical and legal support,organization of emergency aid in any spot of the world, travel insurancecoverage of up to US$1 million). For the comfort and efficiency of Visa Infinitecardholders the Bank offers services of an individual manager. - holders of Halyk Bank's cards, in addition to the services alreadyavailable to them such as payment for mobile phones and utility payments, havereceived an opportunity to pay via any cash maschine for the "ordinary" phonetelecommunications of "Kazakhtelecom" for any telephone in the country ; - customers of JSC "ZhilStroiSberBank" may open and maintain depositsand repay their loans via Halyk Bank's cards; - a new savings deposit has been established, "the card deposit", whichmay be opened directly under the card; - holders of Halyk Bank's cards have been given a unique opportunity toreceive annual and current statements of their savings accounts with "Accumulative Pension Fund of Halyk Bank". - loyalty system with Interfood company was implemented and the first "AltynCity" cobranding bonus payment card was issued with Interfood tradingnetwork . During the year via Halyk Bank's ATMs there were made payments for more than 2.5billion Tenge while about 5 billion Tenge were transferred by Card-to-Cardsystem. Halyk Bank's ATM network is being continuosly upgraded. In 2007, in order tofurther develop ATM network, besides 500 new ATMs, the Bank plans to acquire 300multimedia machines, which will essentially extend the possibilities of theBank's ATM network. Multimedia machines shall be mainly designed for acceptanceof payments in favour of suppliers of different services. As of today 35organizations cooperate with the Bank in acquiring and offer customers of theBank to pay for services via ATM. Making customs payments by a payment card. The volume of custom paymentseffected via payment cards in 2006 made 73.6 billion Tenge and exceeded thevolume of payments effected in 2005 by 117 per cent. The number of customspayments via ATMs in 2006 is 222,316, and exceeded the number of payments in2005 by 94.3 per cent. More than 120 customs posts have been equipped withPOS-terminals for acceptance of custom payments by payment cards. Trade and services centers acquring. In 2006 the volume of payments effected intrade and service organizations via payment cards amounted to 10.9 billion Tengeand exceeded the volume of transactions conducted in 2005 by 53.8 per cent. Thenumber of transactions made in 2006 reached 591,124 and exceeded the number ofpayments in 2005 by 54.5 per cent. Payroll project for commercial corporates. The total amount of funds credited tosalary accounts in 2006 was 218.8 billion Tenge. As of Janury 1, 2007 there are4,011 companies which have payroll projects with the Bank, an increase by 396companies. Corporate card. The number of corporate cards issued as of January 01, 2007 was3,570 having increased by 1,058 compared to the end of 2005. "Internet-Banking" Turnover and revenues of its "Internet-Banking" service (www.mybank.kz) providesHalyk Bank with leading position among Kazakhstani providers of online bankingservices. The services that enjoyed the highest popularity among internet usersin 2006 were card account replenishment, instant transfer from internet accountto internet account, currency conversion and translation, payment for celltelecommunications and utility services, opening an internet deposit, interbankand intrabank transfers, repayment of loans etc. In 2006 Halyk Bank's customers were remotely working with their internetaccounts from the territory of 9 countries, including from the Republic ofKazakhstan (76 per cent), European Union, the United States, Russia, GreatBritain, Liechtenstein, Germany and Belarus. "Mobile Banking" Halyk Bank's "Mobile Banking" service (http://www.halykbank.kz) is the first inKazakhstan service of card account management via mobile phone. At present morethan 130,000 customers use the service, of which 95,500 have joined in 2006(growth by 3.8 times) - this is the most in-demand remote banking service in thecountry. The system of bank account management via mobile phone, unique for Kazakhstan,was launched by Halyk Bank on 19 April 2005 within the framework of the pilotproject with VISA CEMEA - "Mobile Bank - Verified by Visa". On that day theservice was made available to the subscribers of GSM-opertor "KaR-Tel" LLP ("Beeline", "K-mobile" and "Excess" brands). In the next 3 months "Mobile Banking"service was extended to CDMA-operator JSC "Altel" ("Dalacom" and "Pathword"brands) and "GSM Kazakhstan" LLP ("K-cell" and "Activ" brands) - thus by 11August 2006 the whole mobile telecommunications market of Kazakhstan was coveredby the service. Simple connection and extensive capabilities of the service allowed by the endof 2005 to cover the market significantly and on 29 January 2006 the systemcrossed the significant landmark of one million SMS-messages sent to customers.Whereas it took 10 months to reach the first million of SMS-messages, it tookonly 3 months to reach the second million (on 11 April 2006) and in thebeginning of 2007 we expect to reach the level of one million SMS-messages permonth. During the first stage the holders of Halyk Bank's payment cards that havejoined the service could receive an instant SMS-notification to their mobilephones when effecting any transaction on the card account (purchase, payment forservices, reception of salary, payment etc.). A message contains informationabout the sum, the time and the place of the transaction. In addition the userof mobile banking service may send from his cell phone to the Bank an enquiry onthe balance on the card, tranasaction history, indebtedness on the account andmay instantly block his card if necessary, etc. (8 codes in all). For thesepurposes it is necessary to send an SMS-message of prescribed format to number8080, uniform number of Halyk Bank's with all operators (more details about thisand other capabilities at http://www.halykbank.kz/cards/mobil_banking). On 1 March 2006 the second stage of development of "Mobile Banking" servicebegan - the system was implemented an opportunity to effect payments for celltelecommunications directly from mobile phone (for "K-mobile", "Beeline", "Dalacom", "Pathword" and "K-cell" subscribers). Just in 10 months of 2006 27,500such payments were effected for the total amount of 26.7 million Tenge. May 2006, for supporting the service the Bank's wap-site was launched http://wap.halykbank.kz. From 8 June 2006 the customers of Halyk Bank's "Mobile banking" service weregiven the chance to receive on their mobile phone a convenient menu forconducting banking transactions. The menu appears after downloading to the phonefrom the Bank's wap-portal at http://wap.halykbank.kz of free midlet "HalykBank". This technology first appeared in the banking market of Kazakhstan and hasalready been appreciated by our customers at its rue value. On 14 September 2006the total number of customers of Mobile Banking service reached 100,000. October 2006, "Mobile Banking" service became available to customers of sixagent banks, accounts of which are processed in Halyk Bank. 17 November 2006, income from Halyk Banks "Mobile Banking" service has crossed anotable threshold in US$1 million. Such figures were achieved within arelatively short period of time - one and a half year after launch of the "Mobile Banking" service. Currently a third stage of service developments has been launched, installationof the banking upplet directly on the phone SIM-card, which will allow thecustomer to receive a convenient banking menu to his mobile phone and make anypayment (for cell telecommunications, utility services, e-shop payments etc.)and transfers (intrabank, interbank, Card-to-Card etc.) directly from the mobilephone. And what is most important - the payments will be absolutely secure asthey will be confirmed by customers's electronic digital signature. Social Responsibility Halyk Bank of Kazakhstan views corporate responsibility and social policy as oneof the most important conditions for successful development of business in thelong run. The Bank believes that charity actions and sponsorship contributes tostrengthening human values, intellectual values and morality in the society.Competent building of the Bank's corporate social responsibility policy andpublic assistance are an inseparable feature of a dynamically developing companywhich is a part and parcel of the development of the society on the whole. The Bank's expenses under the main directions of charity actions and sponsorshipin 2006 made more than 63 million Tenge. Having approved the charity program, the Bank, thereby, takes responsibility toaid children which have been left without parental care. The Bank has decided toaddress this problem and has prepared projects in three directions: computerliteracy, sport and higher education. The Bank cooperates with United Nations Development Program within the frameworkof the computer literacy teaching and delivers computer equipment for creationof computer classes and organizes trainings for teachers and children of menteechild institutions. In September 2006, teachers of computer science of allmentee child institutions underwent a one-week professional development courseson computer literacy teaching organized by International Academy ofInformatization. And now they will be able to transmit to children the knowledgethey received, relying on lectures and handout materials prepared under theBank's financing. The project cost more than 3 million Tenge. The aim of the "Narodnaya Liga" project for creation of a basketball movement isto upbring a healthy generation of young Kazakhstanis, to promote healthylifestyle and leisure-time by inmates of Children's Homes and Nursing and CareHouses. May tournament "Cup of Hope" has already become a good tradition and we want tobelieve that such traditions will be continuous and diversified. A hospitableZhaksy village in Akmola Oblast once more met old and new friends in order toonce again enjoy vivid performance of future champions and find new friends. The Bank has developed and approved the "Narodnye studenty" program to establisheducational grants for best graduates of mentee child institutions to study ateconomic institutes of higher education and Halyk Bank's scholarships in honourof Kozhakhan Abenov. This will enable the children to become self-sufficient andto become full members of the society. Preliminary calculations show that thecost of this project will be more than 27 million Tenge. Within the framework of social project "Victory Marathon" sponsorship aid wasgiven to republic, oblast and city veteran institutions. The Bank has alwayssupported war veterans and participants and home front veterans, and is no goingto stop on the achived results. The main thing is that these people should beremembered not only on Victory Day but in every day of our life. The Bank, being an active participant of the society, takes care not only forthe lives and well-being of people, but also cares for the country in which itsemplyees are working. Thus one of the Bank's goals is to assist all oblastcenters in impovement of cities and creation of parks and alleys. In 2006 alleysand parks were established and improved, for the amount more than 30 millionTenge, in the following cities of Kazakhstan: Kostanai, Kyzylordaa and Pavlodar. In August 2006 Halyk Bank organized an unprecedented event. The 1st RepublicOlympics for employees of the Bank's financial group "Halyk Group" was held inone of the most picturesque places of Kazakhstan- Burabai resort. The purpose ofthis event was to strengthen principles of healthy lifestyle, as well as toinspire employees to regularly do sports. During three days participantscompeted in four sports such as swimming, running, volleyball and football. Bothindividual and team competitions were held. Relay race the team of Almaty OblastBranch was recognized the winner in the team competitions. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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