Bank Forum reports 9M09 net loss of UAH 424 mln

Bank Forum (FORM) reported yesterday that in 9M09 it recorded a net loss of UAH 424.3 mln, vs. its net income of UAH 68.9 mln for the same period one year earlier. The bank also said that its assets declined 9.1% yoy to UAH 18.6 bln and liabilities dropped 11.2% yoy to UAH 16.5 bln.  Bank Forum was Ukraine’s #12 largest bank by assets, as of July 1, according to the National Bank of Ukraine. Mykyta Mykhaylychenko: Bank Forum continues to accumulate provisions for problematic loans, which equaled 21.7% of its total loan portfolio as end-1H09 according to Fitch. This broadly corresponds to the system average. Importantly, the bank has kept attracting retail deposits (some 30% of the bank’s liabilities) which grew 7% in July-August, twice as fast as the system average. Parent Commerzbank is also actively supporting Forum, accounting for up to 50% of Forum’s liabilities (via interbank loans) and plans to increase Forum’s equity by 49% by yearend. Forum’s Eurobonds maturing on October 30 are trading close to par; YTM is now some 19% and we expect Forum to redeem the papers on time. After a 7% share price increase since end-September, FORM currently trades at 1.07x P/B multiple.