25 July 2014
The State Export-Import Bank of Ukraine (Ukreximbank, EXIMUK) provided no surprises in its 1H14 financial results made public on July 24. The bank’s net interest income increased 6% yoy to UAH 2.0 bln, and its bottom line remained barely positive at UAH 0.1 bln in 1H14. The bank’s gross loan portfolio increased 23% YTD to UAH 52.4 bln, mostly due to increased value of its foreign currency loans (in UAH terms). The bank’s local currency loans increased 2% YTD, while its portfolio of foreign currency loans (in USD terms) fell 4% YTD. The book value of securities held by the bank (mostly government bonds) increased 16% YTD to UAH 40.2 bln, and their share in total assets declined 1pp YTD to 36%.
The bank’s deposit base, which suffered significant deterioration in 1Q14, stabilized in 2Q. Hryvnia deposit inflow reached 15% qoq in 2Q14, after -18% in 1Q. Outflow of foreign currency accounts slowed down to -1% qoq in the last quarter (in USD terms), after -5% qoq in 1Q14.
Alexander Paraschiy: Signs of stabilization of the bank’s deposit base is perhaps the main positive takeaway from Ukreximbank’s 1H14 financials. We remain bullish about the future increase in the bank’s deposit base in the coming quarters, provided that no negative surprises emerge in Ukraine. At the same time, we believe the bank remains fundamentally more risky than its state peer, Oschadbank. Ukreximbank is focused on financing export and import operations, which are currently weakening in Ukraine, with little chance to recover in the near future.