February 05, 2014 the rating committee of RA «Expert-Rating» has decided to confirm the credit rating of PJSC «CREDIT AGRICOLE BANK» (14361575) and the Bank’s bonds of Series В  at the level uaAAА according to the national scale. The borrower with rating uaAAА is characterized by a very high solvency compared to other Ukrainian borrowers. Making decision about confirming the credit rating according to the national scale, the Agency was guided by key results of the Bank’s activity in 2013. 

Table 1

Key balance sheet indicators of PJSC «CREDIT AGRICOLE BANK»

according to the results of 2013

th. UAH, %, p.p.

Indicators	01.01.2014	01.01.2013	Change	Growth rate, %
Shareholders’ equity	1 665 664	1 548 466	117 198	7,57%
Authorized capital	1 222 929	1 050 000	172 929	16,47%
Shareholders’ equity/Assets ratio, %	11,78%	11,80%	-0,02 p.p.	-
Total liabilities	12 477 229	11 576 395	900 834	7,78%
Including liabilities in foreign currency	4 808 100	5 003 145	-195 045	-3,90%
Funds of banks	738 159	1 045 034	-306 875	-29,37%
Funds of individuals	3 848 269	3 287 087	561 182	17,07%
Funds of legal entities	6 983 986	6 490 849	493 137	7,60%
Total assets	14 142 893	13 124 861	1 018 032	7,76%
Liquid assets (Cash and cash equivalents + Funds of mandatory reserves in NBU + Trading securities + Funds in other banks)	2 073 505	3 107 951	-1 034 446	-33,28%
Customer credits and debt, including reserves	11 811 427	9 864 136	1 947 291	19,74%
Loan provisions	374 914	396 896	-21 982	-5,54%
Loan provisions/ customer credits and debt ratio, %	3,17%	4,02%	-0,85 p.p.	-
Securities for sale	910	1 240	-330	-26,61%
Securities for sale provisions	-	-	-	-
Liquid assets/Liabilities ratio, %	16,62%	26,85%	-10,23 p.p.	-

Source: data of PJSC «CREDIT AGRICOLE BANK», calculations by RA «Expert-Rating»

 1.  Key balance sheet indicators of PJSC «CREDIT AGRICOLE BANK» in 2013 have demonstrated positive trends:

• Shareholders’ equity of the Bank has increased by 7,57% or by UAH 117,198 mln up to UAH 1,665 bn. At the same time, it should be noted that in the fourth quarter retained earnings have significantly grown in the structure of the Bank’s shareholders’ equity.

• The growth of the Bank’s assets has amounted to UAH 1,018 bn or 7,76% and as at the beginning of 2014 its amount has reached UAH 14,143 bn. Therefore, the Bank has continued to increase the scales of activities in Ukraine.

• Liabilities of the Bank have grown by UAH 900,834 mln or by 7,78% up to UAH 12,477 bn, i.e. liabilities of the Bank in 2013 have grown almost in proportion with assets.

In 2013 customer credits and debt, including reserves, PJSC «CREDIT AGRICOLE BANK» have grown by 19,74% or by UAH 1,947 bn up to UAH 11,811 bn, while liquid assets have reduced by 33,28% or by UAH 1,034 bn down to UAH 2,073 bn. At the same time, credits and debt of legal entities have grown by 29,34%, and the portfolio of customer credits have reduced by 7,58%. The Agency appreciates the growth of the loan activity of PJSC «CREDIT AGRICOLE BANK» in 2013, since this trend increases the potential of the growth of interest income of the Bank in 2014.

Dynamics of key components of the resource base of PJSC «CREDIT AGRICOLE BANK» has also been characterized by positive trends. As a whole, according to the results of 2013 funds of individuals have demonstrated the most significant growth rates, whose amount has increased by 17,07% or by UAH 561,182 mln and as of 01.01.2014 have amounted to UAH 3,848 bn. Funds of legal entities have grown by 7,60% or by UAH 493,137 mln in the same period and have reached UAH 6,984 bn, and funds of banks have reduced by 29,37% or by UAH 306,875 mln down to UAH 738,159 mln.

2. As of 01.01.2014 the regulatory capital of PJSC «CREDIT AGRICOLE BANK» has amounted to UAH 1,996 bn that is by UAH 78,311 mln more, than as of 01.01.2013. Despite some decrease of the norms N2 and N3, occurred in the period from 01.01.2013 to 01.01.2014, these indicators remain to exceed the limits set by NBU. Thus, as of 01.01.2014 the norm of the regulatory capital adequacy of the Bank (N2), with the indicator of «not less 10%», required by the regulator, has amounted to 15,79%, and the norm of the ratio of the regulatory capital to total assets (N3), with the limit indicator of «not less 9%», has been at the level 13,66%.

Dynamics of the balance sheet indicators of PJSC «CREDIT AGRICOLE BANK» accordingly affected the norms of liquidity of the Bank (N4, N5 and N6). As of 01.01.2014 compared to 01.01.2013 the norms of liquidity of PJSC «CREDIT AGRICOLE BANK» have demonstrated the decrease, but at the same time these indicators have exceeded the limits set by the regulator with significant reserve:

• The norm of instant liquidity (N4) has decreased by 24,45 p.p. and has amounted to 49,55% that exceeds the limit set by NBU by 29,55 p.p. (not less 20%);
• The norm of current liquidity (N5) has decreased by 10,24 p.p. – down to 69,89% that is by 28,98 p.p. higher, than the limit indicator of the regulator (not less 40%);
• The norm of short-term liquidity (N6) has decreased by 1,28 p.p. – down to 88,44% and is complied with reserve at the level 28,44p.p. with respect to the norm.

Table 2

Key norms of PJSC «CREDIT AGRICOLE BANK» according to the results of 2013

th. UAH, %, p.p.

Norms	The norm set by NBU	01.01.2014		01.01.2013		Change, th. UAH, p.p.
		The Bank’s norm	The average of the system	The Bank’s norm	The average of the system
Regulatory capital (N1), th. UAH	Not less than UAH 120 000 th.	1 995 994	-	1 917 683	-	78 311
Regulatory capital adequacy (N2), %	Not less 10%	15,79%	18,26%	19,39%	18,06%	-3,60 p.p.
Regulatory capital/Total assets ratio (N3), %	Not less 9%	13,66%	13,98%	14,22%	14,89%	-0,56 p.p.
Instant liquidity (N4), %	Not less 20%	49,55%	56,99%	74,00%	69,26%	-24,45 p.p.
Current liquidity (N5), %	Not less 40%	68,98%	80,86%	79,22%	79,09%	-10,24 p.p.
Short-term liquidity (N6), %	Not less 60%	88,44%	89,11%	89,72%	90,28%	-1,28 p.p.
Norm of large loan risks (N8), %	Not more 800%	148,33%	172,05%	94,94%	172,91%	53,39 p.p.
Norm of the maximum amount of loans, guarantees and sureties, issued to the insiders (N10), %	Not more 30%	1,14%	1,63%	1,33%	2,41%	-0,19 p.p.

Source: data of PJSC «CREDIT AGRICOLE BANK», NBU, calculations by RA «Expert-Rating»

In its turn, the policy of optimization of managing liquidity, which was conducted by the management of PJSC «CREDIT AGRICOLE BANK» in 2013, has enabled to considerably increase the key indicators of income of the Bank.

3. According to the results of 2013 compared to 2012 PJSC «CREDIT AGRICOLE BANK» has demonstrated significant increase in key articles of income:

• Net interest income of PJSC «CREDIT AGRICOLE BANK» has increased by UAH 82,268 mln or by 10,38% and has reached UAH 875,070 mln;
• Net commission income of the Bank has grown by UAH 51,920 mln or by 20,62% up to UAH 303,774 mln;
• Result from operations with foreign currency has grown by UAH 2,611 mln or by 3,76% up to UAH 72,072 mln.

Net profit of PJSC «CREDIT AGRICOLE BANK» has amounted to UAH 368,745 mln according to the results of 2013 that is by 7,70% less, than according to the results of 2012. Among the factors, which affected the decrease in profit, it should be emphasized the increase of administrative and other operating expenses of the Bank by 4,63% (or by UAH 30,954 mln).

Table 3

Separate indicators of income and expenses of PJSC «CREDIT AGRICOLE BANK» for the 2012-2013

th. UAH, %, p.p.

Indicators	2013	2012	Change	Growth rate, %
Net interest income	875 070	792 802	82 268	10,38%
Net commission income	303 774	251 854	51 920	20,62%
Net commission income/ Net interest income ratio	34,71%	31,77%	2,94 p.p.	-
Result from operations with securities in the trading portfolio of the bank	-	-	-	-
Result from operations with foreign currency	72 072	69 461	2 611	3,76%
Administrative and other operating expenses	699 242	668 288	30 954	4,63%
Net profit	368 745	399 524	-30 779	-7,70%
ROE, %	22,14%	25,80%	-3,66 p.p.	-

Source: data of PJSC «CREDIT AGRICOLE BANK», NBU, calculations by RA «Expert-Rating»

Therefore, in 2013 PJSC «CREDIT AGRICOLE BANK» has demonstrated good dynamics of development by most of key parameters. The subsidiary bank of the group Crédit Agricole during the 2013 has successfully increased the scales of its activity in Ukraine by increasing resource base, equity, loan portfolio and assets. Against the background of the scales growth the key indicators of income, such as net interest income and net commission income, have grown and the Bank has also generated significant net profit comparable to the shareholders’ equity of the Bank.

Increasing the scales of presence in Ukraine together with the increase in key articles of income, PJSC «CREDIT AGRICOLE BANK» maintains the norms of equity and liquidity with significant reserve with respect to the limits, set by NBU that provides it with a necessary level of financial stability and solvency.

 

Analytical service of RA «Expert-Rating»

Confirmation of PJSC «CREDIT AGRICOLE BANK» (english version) - 05.02.2014