Tinkoff Bank 12M2015 RAS Results

Statement on Tinkoff Bank's RAS Financial Highlights for January-December 2015

Moscow, Russia - 26 January 2016. TCS Group Holding PLC (TCS LI) (the "Group"), including Tinkoff Bank, Russia's leading provider of online retail financial services, today announces Tinkoff Bank's unaudited RAS financial highlights for January-December 2015.

For the full year 2015, net income stood at RUB 3.0 bn as a result of higher interest expenses, increased loan provisioning and losses from operations with foreign currencies due to the Russian Ruble devaluation. Tinkoff Bank had low FX exposure hedging its long-term liabilities with swaps.

It should be noted that the RAS net income figure is not a reliable indicator of IFRS net income for the same period. There is a very low correlation between financial results under the two reporting standards as a result of significant accounting differences. Therefore, RAS figures should not be used as the basis for conclusions on forthcoming IFRS results. 

The gross loan portfolio amounted to RUB 100.9 bn representing an increase of 5% y-o-y. The net loan portfolio amounted to RUB 78.3 bn having increased by 12% y-o-y and constituted 56% of total assets (63% at year-end 2014). 

Retail customer accounts increased by 113% y-o-y to RUB 88.2 bn. Tinkoff Bank continued to retain substantial liquidity: the CBR N2 ratio stood at 47.4% (minimum requirement: 15%), and the CBR N3 ratio was 136.3% (minimum requirement: 50%). Retail customer accounts constituted 75% of total liabilities.

Total assets increased by 25% y-o-y to RUB 139.4 bn.

As of 1 January 2016, total capital including retained profits (based on Form 123) amounted to RUB 25.3 bn. The CBR N1 capital adequacy ratio was 13.0%. Both Core Capital Adequacy Ratio (N1.1) and Main Capital Adequacy Ratio (N1.2) were 9.3%.

Note on RAS results

Please note that the figures in this press release are calculated in accordance with Tinkoff Bank's internal methodology which is available at:

http://static.tinkoff.ru/documents/eng/investor-relations/ras-methodology.pdf

RAS results are not a reliable indicator of IFRS results due to significant accounting differences that make a direct read-across from RAS to IFRS results impossible. The main differences between RAS and IFRS are:

• Consolidated results under IFRS include a number of additional items and results of its subsidiaries

• Accrual of expenses under IFRS

• Timing differences in accounting for restructured loans ('instalments') and loans going through courts

• The effect from the revaluation of currency derivative instruments

• The effect of deferred income tax.

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. In order to support its branchless platform, the Group has also developed a "smart courier" network covering almost 600 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 business, 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 November 2015, the bank was the second largest player in the Russian credit card market, with a market share of 7.7%. As at 1 December 2015, the bank issued over 5.4 m credit cards. The bank is well capitalised: its CBR N1 total capital ratio stood at 13% as at 1 December 2015.

The 9M 2015 IFRS net income of the Group amounted to RUB 0.9 bn.

In 2013, Tinkoff Bank was recognised as the Bank of the Year and the most profitable bank in Russia by the Banker magazine, the world's premier banking and finance resource, published by the Financial Times Group. In 2015, the Global Finance magazine named Tinkoff Bank as the Best Internet Retail Bank in Russia.