UPDATE: CEO: Sberbank IFRS net profit to rise to 1 tln rbl in 2020

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LONDON, Dec 14 (PRIME) -- The net profit of Russia’s biggest lender Sberbank will amount to about 1 trillion rubles in 2020, as calculated under International Financial Reporting Standards (IFRS), CEO German Gref said at a 2020 strategy presentation on Thursday.

The bank said earlier that its IFRS net profit soared to 541.9 billion rubles in 2016.

Gref said that Sberbank plans to raise dividends to 50% of its IFRS net profit or even more in 2020.

“We have a target level of (capital adequacy) at 12.5%, which is not high, but, from our point of view, enough to prevent shocks… geopolitical or macroeconomic risks,” he said. “We may reach this level target following the results of 2019… In early 2020… we will be able to pay 50% (of IFRS net profit) or more in dividends.”

He added that dividends for 2018-2020 will amount to 1 trillion rubles.

Alexander Morozov, director of the survey and forecast department, said that the bank intends to raise its commission income by 50% and interest income by 10% until 2020.

“We are ambitious to increase our commission income 1.5-fold to 50%. This will be a key growth driver for our revenue in the next three years,” he said, adding that the bank will simultaneously reduce its risk costs and expenses.

“We will keep our word to suppress our expenses below inflation.”

Gref also said that Sberbank expects the oil price to remain stable in the medium term at around $55 per barrel.

He also said that Russian central bank is conducting consistent policy to purge the banking sector and to control inflation. “The central bank’s policy is consistent enough. We have never seen such tough policy to clean up and purge the financial market in the modern Russian history. And we have never had such low inflation,” he said.

“Nobody could believe that inflation may stand at 4%. And this year it will amount to around 2.5%. Nobody could believe it a year ago,” he said.

Gref also said that inflation will stand at 4% in the next three years, “but may possibly be lower.”

(59.1446 rubles – U.S. $1)

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