OREANDA-NEWS. On June 07, 2007 Home Credit & Finance Bank ("HCFB"), rated Moody's Ba3/NP/D-, S&P B+/B, and one of the leading banks specializing in consumer banking in Russia, announced its financial results for the three months ended 31st March 2007 in accordance with International Financial and Reporting Standards (IFRS), reported the press-centre of  HCFB.

Highlights
Net profit for the period of RUR 204 million (Q1 2006: RUR 125 million) - an increase of 63,2%
Operating income increased 62,5% in the period to RUR 3,158 million (Q1 2006: RUR 1,943 million).

Increase in the Bank's revolving credit activities with a 168% uplift in the value of credit loans granted, compared to Q1 2006, maintaining HCFB's position as the second largest provider of credit cards in Russia with 9,5% market share

Revolving credits and cash loans accounted for approximately 38% and over 6% respectively of the Bank's loan portfolio in the first quarter.

The HCFB branch network covers 77 regions across the Russian Federation serviced from 82 representative offices. 24 new loan offices were opened in the first quarter of 2007 and the number of employees rose to 10,191 from 4,974 in the prior year period.

HCFB's client base comprises 12,2 million customers - an increase of 43,5% over the prior year period.

Maintenance of strong capitalisation with risk weighted CAR of 22,3% (YE 2006: 23,7%).

On 4th May, 2007 Standard & Poors raised its long- and short-term credit ratings on HCFB to B+/B reflecting the on-going support of HCFB's parent, the PPF Group N.V.

Continuing improvement in net interest income of RUR 2,837 million (Q1 2006: RUR 1,908 million) attributed to the growth in the revolving credit andcash loan portfolios.

HCFB's net profit increased by 63,2%, compared to the prior year period, up from RUR 125 million to RUR 204 million. The result was driven by an increase of 49% in the Bank's net interest income from RUR 1,908 billion to RUR 2,837 billion. The growth in net interest income is attributable to the significant increase in the volume of revolving credit card loans where the cumulative value of loans granted totalled RUR 5,861 billion, an increase of over 168% from the prior period last year. HCFB has maintained its ranking as the second largest provider of credit cards by market share with a share of 9,5%.

The cumulative value of cash loans granted increased from RUR 40 million in the prior year period to RUR 1,159 billion, whereas the cumulative value of POS loans granted decreased by 10% in the same period. The decrease resulted from the stabilising of the POS loan market in Russia and HCFB's continued focus on growing its credit card and cash loan portfolio. HCFB's market share in the point of sales market remained stable at 22% and the bank continues to maintain its position as one of the leading providers of consumer banking in the Russian market servicing a customer base of 12,2 million. HCFB's gross loan book has developed in line with the bank's stated strategy of growing the credit card and cash loan business. The overall gross loan book grew from RUR 36,723 billion as at year end to RUR 40,285 billion, an increase of 10%. Credit cards accounted for 38% of the gross loan book, up from 32% at year end and cash loans accounted for over 6% of the book, up from 5% at year end.

For the first time, residential mortgages were offered by HCFB and mortgage advances accounted for RUR 343 million in the first quarter of the year. HCFB considers the mortgage market to be an important area for its loan portfolio and business diversification and in April 2007, the Bank opened its second mortgage centre in St. Petersburg. The car loans market also represents a key area for the Bank - the pilot project was launched in March this year.

HCFB continued to expand its regional presence by developing its own loan office distribution network. During the period HCFB opened 24 new loan offices across Russia with the total number of loan offices exceeding 42 branches as of Q1 2007.

As at the end of Q1 2007, Home Credit & Finance Bank had a risk-weighted capital adequacy ratio of 22,3%; and a Tier 1 capital position of 20,4%. In May 2007, Standard & Poors reaffirmed its decision to raise its long and short-term counterparty credit ratings on HCFB to B+/B from B/C.