On September 25, 2015, by the decision of the rating committee of the Rating Agency "Standard-Rating", a decision was made to update the ratings of JSC «Commercial Industrial Bank» (USREOU code 21580639) on the national scale:
The long-term rating of JSC «CIB» on the national scale at the level of uaА, outlook stable. A bank or a separate debt instrument with a rating of uaA
is characterized by high creditworthiness compared to other Ukrainian borrowers or debt instruments. The level of creditworthiness is sensitive to the influence of adverse commercial, financial, and economic conditions. The short-term rating of JSC «CIB» on the national scale at the level of uaK2, outlook stable. A bank or a separate debt instrument is characterized by high creditworthiness compared to other Ukrainian borrowers or debt instruments. The financial state of such a borrower is sufficiently high to prevent foreseeable risks in the short-term period. The rating of deposits of JSC «CIB» at the level of ua2 on the scale of RA «Standard-Rating», outlook stable.
The decision to update the credit rating of JSC «CIB» was made in accordance with the results of the analysis of the Bank's work for the first half of 2015:
1. Based on the results of the first half of 2015, the key balance sheet indicators of JSC «CIB» demonstrated positive dynamics, in particular:
the volume of the Bank's liabilities grew by 3.5 times; loans and debts of clients grew by 35.96%; equity of JSC «CIB» increased by 6.05%; the Bank's assets grew by 38.13%.
The Agency draws attention to the fact that, despite the complex macroeconomic conditions of activity and the turbulence of the banking system, in the first half of the current year JSC «CIB» managed to substantially grow the volume of the resource base (in hryvnia equivalent). Thus, as of 01.07.2015 compared to 01.01.2015 funds of legal entities grew by 7 times, and the volume of funds of individuals increased by 26.61%.
Table 1
Main balance sheet indicators of PJSC «COMMERCIALINDUSTRIAL BANK», UAH thousand, %
Indicator
01.07.2015
01.01.2015
Growth rate, %
UAH thousand
%
UAH thousand
%
Funds of legal entities
44 048
22.16
6 216
4.32
608.62
Funds of individuals
14996
7.54
11844
8.23
26.61
Liabilities, total:
66014
33.20
18703
12.99
252.96
Statutory capital of the bank
112417
56.54
112417
78.11
-
Equity, total:
132 798
66.80
125 225
87.00
6.05
Cash funds and their equivalents
19 942
10.03
13 142
9.13
51.74
Funds of the bank's mandatory reserves in the NBU
-
-
-
-
-
Funds in other banks
4 202
2.11
-
-
-
Loans and debts of clients
161103
81.03
118497
82.33
35.96
Securities in the bank's portfolio for sale
60
0.03
60
0.04
-
Securities in the bank's portfolio until maturity
-
-
-
-
-
Fixed assets and intangible assets
11 364
5.72
10 779
7.49
5.43
Other financial assets
1 223
0.62
671
0.47
82.27
Assets, total:
198812
100.00
143930
100.00
38.13
2. For the first half of 2015, the regulatory capital of JSC «CIB» (N1) increased by 7.59%: from UAH 123.827 million as of 01.01.2015 to UAH 133.225 million as of 01.07.2015. The regulatory capital adequacy ratio (N2) for the same period decreased by 21.77 p.p.: from 93.40% to 71.63%. Such dynamics of the N2 ratio is explained by the growth of the Bank's business activity. As of 01.07.2015, the regulatory capital adequacy ratio of JSC «CIB» (N2) with a large reserve exceeded both the limit established by the regulator for this ratio, and the average value of N2 across the banking system of Ukraine (by 61.63 p.p. and 62.60 p.p. respectively). Thus, as of the beginning of the second half of the current year, the level of sufficiency of the Bank's regulatory capital was very high.
As of 01.07.2015, JSC «CIB» demonstrated high liquidity indicators:
· the instant liquidity ratio (N4) was 60.40%, with a limit value of 20%, and an average N4 indicator across the banking system at the level of 57.24%;
· the current liquidity ratio (N5) was 178.54%, with a regulatory value of 40%, and an average value across the system of Ukrainian banks of 70.13%;
· the short-term liquidity ratio (N6) was 302.63%, with a limit indicator of 60%, and an average value across the system of 79.60%.
Thus, as of the beginning of the second half of 2015, JSC «CIB» maintained a large reserve under the instant liquidity ratio, and a very large reserve under the current and short-term liquidity ratios. Partially this is explained by the structure of the Bank's liabilities, in which the largest share is still occupied by equity.
Table 2
Main norms of PJSC «COMMERCIALINDUSTRIAL BANK», UAH thousand, %
Indicator
Regulatory value
01.07.2015
01.01.2015
across system
bank
across
system
bank
Regulatory capital (N1)
>120 million
-
133 225
-
123 827
Regulatory capital adequacy ratio (N2)
>10%
9.03%
71.63%
15.60%
93.40%
Instant liquidity ratio (N4)
>20%
57.24%
60.40%
57.13%
85.93%
Current liquidity ratio (N5)
>40%
70.13%
178.54%
79.91%
95.38%
Short-term liquidity ratio (N6)
>60%
79.60%
302.63%
86.14%
118.84%
Maximum credit risk ratio per one counterparty (N7)
<25%
23.27%
23.27%
22.01%
23.38%
Large credit risk ratio (N8)
<800%
573.17%
119.57%
250.04%
85.34%
3. Based on the results of the first half of 2015, JSC «CIB» showed a profit in the amount of UAH 7.572 million, which by 19.4 times exceeded the Bank's profit for the same period of 2014. Such significant growth of the Bank's financial result happened thanks to weighty growth of net interest income, the volume of which in the first half of the current year compared to the first half of the previous year grew by 7 times (by 622.74%): from UAH 2.436 million to UAH 17.606 million. Also, the Agency notes the growth of the result from operations with foreign currency (+16.80%) and the decrease of the volume of administrative and other operational expenses (-5.66%), which positively influenced the Bank's financial result.
Table 3
Data on the key items of income and expenses of PJSC «COMMERCIAL INDUSTRIAL BANK», UAH thousand, %
Indicator
For H1 of 2015
For H1 of 2014
Change
Growth rate, %
Interest income
17 799
3 854
13 945
361.83
Net interest income
17 606
2 436
15 170
622.74
Commission income
2 068
2 562
-494
-19.28
Result from operations with foreign currency
1 988
1 702
286
16.80
Interest expenses
193
1 418
-1 225
-86.39
Commission expenses
821
891
-70
-7.86
Administrative and other operational expenses
7 021
7 442
-421
-5.66
Profit
7572
391
7 181
1836.57
Thus, JSC «CIB» demonstrated positive dynamics of development, which is evidenced by the key indicators of the Bank's activity based on the results of the first half of 2015. JSC «CIB» was growing business activity, despite complex macroeconomic conditions and the turbulence of the banking system. The Bank substantially increased the resource base and grew the volume of the loan portfolio. In the first half of the current year, JSC «CIB» generated a weighty volume of profit, which by 19.4 times exceeded the Bank's profit for the same period of 2014. The Bank entered the second half of 2015 with a very large reserve of regulatory capital and liquidity, which gives it the opportunity to further grow business activity.
Rating Agency «Standard-Rating» (Ukraine)
