Ukrsotsbank expects NI of UAH 100-150 mln in 2009

Ukrsotsbank (USCB) is targeting net income of UAH 100-150 mln in 2009, Interfax reported yesterday. Ukrsotsbank posted net income of UAH 791.8 mln in 2008. Mykyta Mykhaylychenko: Ukrsotsbank’s 1H09 IFRS interim financials revealed net income of UAH 115 mln. Ukrsotsbank posted positive NI while many of the other largest banks in Ukraine showed negative NI in 1H09. If things continue at this pace, Ukrsotsbank’s final NI in 2009 may be even higher than UAH 100-150 mln in 2009. Net income better than its peers can be attributed to the bank’s slower accumulation of provisions against troubled loans. As of the end of 2Q09, provisions amounted to some 7% of its total loan portfolio, while system average is above 10%. According to Fitch, Ukrsotsbank’s NPLs increased to 18.5% of gross loans in 2Q09, which generally corresponds to the system average. At the same time, the bank managed to more than double its net interest income in 1H09 and reduce its SG&A by 9.3% in 1H09 compared to 1H08. Furthermore, parent UniCredit Group provides firm support via interbank loans and the European Bank for Reconstruction and Development has committed to provide the bank with a USD 100 mln subordinated loan.