In line net profit, strong core

RBI’s reported net income came to EUR 578 mln in the quarter, down by 12%
q-o-q and 55% y-o-y. The yearly comparison is distorted by the Bulgarian gain
in the previous year (EUR 435 mln). The second quarter was burdened by Polish
litigation costs of EUR 338 mln compensated by provision releases in Russia
while other segments also reported good asset quality.
 Net interest income was down q-o-q as a result of weaker Russia (FX was down
too) while ex-RU,BY there was a growth of 4.2%. NIM as a result stayed stable
and was actually up at Core. RBI substantially decreased its Russian business
in terms of fees which resulted in lower figures in Group Corporates as
transaction limits increased.
 OPEX increased q-o-q by 10% and 12.5% at the Core segments, mostly driven
by higher other items i.e. consultation fees (1/3 of growth) and higher wages at
Head Office.
 Lending and deposit volumes were down 3% both on a Group level, Ex-RU,BY
was down by 3% in terms of loans as a result of repo business reduction while
deposits were also slightly down in EUR terms driven by large tickets at Group
corporates, other segments were rather stable.
 NPE ratio was unchanged at 1.5% with coverage at 57.6% and risk overlays of
EUR 865 mln with RBI claiming low inflows of NPEs.
 Capital ratio stood at 15.6% (CET1 fully-loaded) ex-RU,BY would have been
13.6% - a comfortable ratio.