TCS Group Holding PLC: Statement on Tinkoff Bank's RAS Financial Highlights for January - November 2017

Statement on Tinkoff Bank's RAS Financial Highlights for January - November2017

Moscow, Russia - 26 December 2017. TCS Group Holding PLC (TCS LI) (the "Group"), Russia's leading provider of online retail financial services via its Tinkoff.ru financial supermarket,today announces Tinkoff Bank's unaudited RAS financial highlights for January - November2017.

For the eleven monthsof2017, net income stood at RUB 16.2bn versus RUB 8.4bn in January-November 2016,which is attributed to the growth of net interest income, lower cost of funding,improved quality of the loan portfolio and growth of revenue from new business lines.

It should be noted that the RAS net income figure is not a reliable indicator of IFRS net income for the same period. There is a very low correlation between financial results under the two reporting standards as a result of significant accounting differences.Therefore, RAS figures should not be used as the basis for conclusions on forthcoming IFRS results. 

The gross loan portfolioamounted to RUB 167bn representing an increase of 42% y-o-y. The net loan portfolio amounted to RUB 140bn having increased by 45% y-o-y and constituted 56% of total assets (57% at year-end 2016). 

Retail customer accounts stood at RUB 141bn. Tinkoff Bank continued to retain substantial liquidity: the CBR N2 ratio stood at 52% (minimum requirement: 15%), and the CBR N3 ratio was 180% (minimum requirement: 50%). Retail customer accounts constituted 67% of total liabilities.

Total assets increased by 50% y-o-y to RUB 252bn.

As of 1 December 2017, total capital including retained profits (based on Form 123) amounted to RUB 58.9bn. The CBR N1 capital adequacy ratio was 16.29%. Core Capital Adequacy Ratio (N1.1) was 10.31%and Main Capital Adequacy Ratio (N1.2) was 15.07%.

Our strong November2017 RAS results are driven by two major continuing trends:

a)     an ongoing quality growth of our consumer finance business;

b)     a growing contribution from our non-credit fees-and-commission business lines.  

Note on RAS results

Please note that the figures in this press release are calculated in accordance with Tinkoff Bank's internal methodology which is available at:             

http://static.tinkoff.ru/documents/eng/investor-relations/ras-methodology.pdf

RAS results are not a reliable indicator of IFRS results due to significant accounting differences that make a direct read-across from RAS to IFRS results impossible. The main differences between RAS and IFRS are:

*        Consolidated results under IFRS include a number of additional items and results of its subsidiaries

*        Accrualofexpensesunder IFRS

*        Timing differences in accounting for restructured loans ('instalments') and loans going through courts

*        The effect from the revaluation of currency derivative instruments

*        The effect of deferred income tax.

Aboutthe Group

TCS Group Holding PLC is an innovative provider of online retail financial services operating in Russia through a high-tech branchless platform. TCS Group includes Tinkoff Bank, mobile virtual operator network Tinkoff Mobile, Tinkoff Insurance, and Tinkoff Software DC, a network of development hubs across Russia.

The Group was founded in 2006 by the Russian entrepreneur Oleg Tinkov and has been listed on the London Stock Exchange since October 2013.

With no retail branches, the Group serves its customers remotely via online channels and its call centre, and operates a network of over 1,800 representatives to ensure smooth delivery of its products. The network covers all of Russia and allows next day delivery to most customers.

The Group's key business is Tinkoff Bank, Russia's first and only direct bank offering both own brand and partner retail financial services via its Tinkoff.ru platform. The product range includes daily banking (credit and debit cards, payments, money transfers), savings, investments, loyalty programmes, travel services, SME services, mortgage platform, and insurance. With its special focus on mobile business, the bank offers mobile applications both for its customer base (Mobile Bank) and beyond it (Traffic Fines, MoneyTalk, Card 2 Card instant money transfers).

As at 1 October2017, the bank was the second largest player in the Russian credit card market, with a market share of 11.6%. The 9M2017 IFRS net income of TCS Group Holding PLC amounted to RUB 12.6 bn, ROE stood at 48.8%.

Banki.ru, Russia's largest financial news portal, named Tinkoff Bank the Bank of the Year 2016. In October 2016 Tinkoff Bank was named the largest independent global direct bank by Frost & Sullivan. In 2015 and 2016, the Global Finance magazine named Tinkoff Bank as the Best Consumer Digital Bank in Russia. In 2016, the bank also won Global Finance's Best Integrated Consumer Bank Site award and was named the Best Digital Bank in the CEE by Euromoney. The bank's mobile application was recognised as the best in Russia by Markswebb Rank & Report for three consecutive years in 2014, 2015 and 2016, and by Deloitte for four consecutive years from 2013 to 2016.