Nurbank announced its performance results for 2014, based on consolidated financial statements prepared in accordance with IFRS.
Key performance outcomes for 2014:
As of 2015, international rating agency Standard & Poor's confirmed Nurbank's long-term and short-term credit ratings at 'B/B', and the national scale rating at 'kzBB+'. Analysts believe the confirmation of Nurbank's ratings reflects effective management of non-performing assets and reduced vulnerability to risks associated with lending to the construction and real estate sectors, thus improving the bank's risk profile.
“At the same time, we expect Nurbank's capitalization metrics to remain 'adequate' in 2015-2016. The 'stable' outlook reflects Nurbank's ability to expand its business volume while gradually reducing non-performing loans, and maintaining 'adequate' capitalization and liquidity metrics,” noted Standard & Poor's analysts.
According to the state financial oversight, at the end of 2014, we ranked 14th out of 38 Kazakhstani banks by asset size.
As of December 31, 2014, the Bank has 16 branches and 75 offices. The number of ATMs and POS terminals was 347 and 1250 respectively.
Notably, the Bank is present in all major regions of the Republic of Kazakhstan. Additionally, it has a developed network of branches and ATMs in all major regional centers, a high level of plastic card issuance, absence of external debt, and a high level of Bank capitalization (as of February 1, 2015, the Bank ranked 15th in terms of equity). In the near future, the Bank intends to pursue strategic goals for further business development, including:
Capital Adequacy
Currently, the Bank's risk-adjusted capital (RAC) ratio, calculated using the National Bank of Kazakhstan's methodology, is approximately 14.2% as of January 1, 2014. This current capital level allows the Bank to double its assets, without the RAC ratio dropping below 10% even with aggressive growth in coming years.
Business Segment Results
In 2013, the Bank decided to develop the retail business as an integral feature of a universal commercial bank.
“We intend to increase our share in servicing retail, small and medium-sized businesses. By the end of 2014, the credit portfolio structure was: corporate business -57%, SME -24%, retail business -19%. Plans for 2016 envisage reducing the corporate business share to 48% of the loan portfolio, by increasing the shares of SMEs and retail businesses,” said Chairman of the Board of JSC Nurbank, Kantar Orynbaev.
Corporate Sector and SMEs
The loan portfolio for the corporate and SME sectors as of December 31, 2014, amounted to 188.7 billion tenge. Growth compared to December 31, 2013, was 5.5%. The share of the corporate and SME sector portfolio in the total loan volume to clients was 80.7%.
The volume of corporate sector client funds as of December 31, 2014, amounted to about 83 billion tenge compared to 77 billion tenge as of December 31, 2013.
The SME deposit portfolio amounted to 30,908 thousand tenge, with a growth of 12,109 thousand tenge or 64.4% in 2014.
Currently, the Bank operates under the following lending programs from the Damu Entrepreneurship Development Fund JSC:
Additionally, the Bank actively implements the Business Road Map 2020 program, participates in the urban development program 2012-2020 for single-industry towns, and subsidization programs for credit reward rates for private entrepreneurs operating in Zhanaozen, as well as a credit reward rate reimbursement program to support agriculture, implemented jointly with the Ministry of Agriculture.
“The social effect of projects financed within state programs is that our collaboration with the government allowed the supported companies to develop their business, create additional jobs, increase their income, salaries, and state budget revenues, among other things. — said the Chairman of the Board of JSC Nurbank, Kantar Orynbaev, — “We financed 113 projects within state programs with a total amount of approximately 12 billion tenge. Preliminary calculations suggest nearly 800 new jobs were created thanks to these programs. We believe these programs significantly contribute to SME development, with the state, by offering such business support programs, successfully demonstrating the effectiveness of its investments,” he concluded.
Retail Sector
As of December 31, 2014, the loan portfolio for the retail sector amounted to 45.2 billion tenge, mainly due to consumer and unsecured loans. The share of retail sector loans in the total loan volume to clients was 19.3%. The share of mortgage loans in the retail sector loan volume was 45.18%.
Retail client funds amounted to 70.5 billion tenge as of December 31, 2014. Growth compared to December 31, 2013, was 27.5% or 15.2 billion tenge.