TCS Group Holding PLC Upgrades FY 2016 Guidance

TCS Group Holding PLC Upgrades

FY 2016 Guidance

Moscow, Russia - 14 October 2016. TCS Group Holding PLC (TCS LI) (the "Group"), Russia's leading provider of online retail financial services, including Tinkoff Bank and Tinkoff Insurance, today upgrades its guidance for FY 2016 net income, ROE, cost of risk and net portfolio growth.

A combination of Tinkoff's data-driven, flexible business model, a series of good business decisions and overall improvements in the operating environment, have enabled the Group to revise its expectations for FY 2016 net income to the RUB 9-10 bn range, up from previous guidance of RUB 7-8 bn given at the time of 1H 2016 IFRS results.

Supported by this improved performance, ROE is expected to be above 35% for FY 2016, up from previous guidance of comfortably above 30%.

Due to the Group's ongoing rigorous portfolio quality control, cost of risk is now forecast to be in the range of 8.5-9.5%, down from previous guidance of 10-12%.

Net portfolio growth is now expected to be around 24%, up from the 15-20% range given at the time of previous financial results.

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About the Group

TCS Group Holding PLC is an innovative provider of online retail financial services operating in Russia through a high-tech branchless platform. The Group has also developed a "smart courier" network covering almost all cities and towns in Russia which allows next day delivery to many customers.

Tinkoff Bank's product range includes credit, debit and prepaid cards, deposits, co-branded cards, and agent-based mortgage products. With its special focus on mobile, the bank offers mobile applications both for its customer base (Mobile Bank) and beyond it (Traffic Fines, MoneyTalk, Card 2 Card instant money transfers).

As per its five-year strategy, the Group has the ambition to become a financial marketplace, offering both own brand and partner products.

As at 1 September 2016, the bank was the second largest player in the Russian credit card market, with a market share of 9.7%. The Group's 1H 2016 IFRS net income amounted to RUB 4.4 bn.

In 2015 and 2016, the Global Finance magazine named Tinkoff Bank as the Best Consumer Digital Bank in Russia. In 2016, the bank also won Global Finance's Best Integrated Consumer Bank Site award and was named the Best Digital Bank in the CEE by Euromoney. The bank's mobile application was recognised as the best in Russia by Markswebb Rank & Report for three consecutive years in 2014, 2015 and 2016, and by Deloitte for four consecutive years from 2013 to 2016.

Forward-looking statements

Some of the information in this announcement may contain projections or other forward-looking statements regarding future events or the future financial performance of the Group and Tinkoff Bank. You can identify forward looking statements by terms such as "expect", "believe", "anticipate", "estimate", "intend", "will", "could," "may" or "might", the negative of such terms or other similar expressions. The Group and Tinkoff Bank wish to caution you that these statements are only predictions and that actual events or results may differ materially. The Group and Tinkoff Bank do not intend to update these statements to reflect events and circumstances occurring after the date hereof or to reflect the occurrence of unanticipated events. Many factors could cause the actual results to differ materially from those contained in projections or forward-looking statements of the Group and Tinkoff Bank, including, among others, general economic conditions, the competitive environment, risks associated with operating in Russia, rapid technological and market change in the industries the Group operates in, as well as many other risks specifically related to the Group, Tinkoff Bank and their respective operations.