Earnings Report /
Russia

Bank St Petersburg: 3Q21 IFRS results – NEUTRAL-to-POSITIVE

  • Bank St Petersburg (BSPB RX: O/W; TP RUB60) reported its 3Q21 IFRS results

  • Operating costs remained under control

  • After a 77% rally YTD, the stock trades at 0.43x P/TBV and 2.8x P/E 2021F, which is still undemanding

Evgeniy Kipnis
Evgeniy Kipnis

Senior Banking/Consumer Analyst

Alfa
18 November 2021
Published by

Bank St Petersburg (BSPB RX: O/W; TP RUB60) reported its 3Q21 IFRS results. 3Q21 net income jumped 50% y/y to RUB4.1bn with 17.1% ROAE (though 4% below consensus). CoR of 0.7% was the biggest surprise, although it was offset by RUB0.6bn of an investment property impairment loss. Core banking lines roughly matched expectations – NII grew 17% y/y (supported by the 7% y/y corporate loan book growth and 17% y/y retail loans growth) and F&C income growth was normalized at 13% y/y in Q3 vs (39% y/y in Q2), with settlement transactions and credit-related insurance sales being key drivers. Operating costs remained under control – +12% y/y in 3Q21 and +6% y/y in 9M21 (vs 2021F guidance of 10% y/y growth)

After a 77% rally YTD (vs 26% YTD by the MOEX Index and 26-37% by SBER RX and VTBR RX), the stock trades at 0.43x P/TBV and 2.8x P/E 2021F, which is still undemanding. The bank has increased its strategic ROE guidance from 15% to 16%, which we think is achievable already in 2021F, considering the YTD performance. In our view, further upside in the name is subject to the sustainability of the CoR and ROE levels, achieved in 2021. We would expect management to comment on that today during the conference call.

BSPB hosts a conference call today at 16:00 Moscow time / 8:00 New York / 13:00 London via Zoom platform – to register, use the link https://us06web.zoom.us/webinar/register/WN_B26gvo45Q1GUsmVGvxzUaw

Source: Company data, Alfa-Bank, consensus compiled by BSPB