Russian Standard Discloses Effective Rate in International Reporting
On Wednesday, the results of the work of the leader of the consumer lending market, Russian Standard Bank, became known in 2006 under IFRS. The bank was the first of the credit institutions to disclose the size of the effective rate (for credit cards - 79.2%, for consumer loans - 44.3%) and simultaneously demonstrated portfolio growth rates and business profitability above average in the market. However, analysts believe that they managed to do this only by increasing the share of credit cards, which made it possible to offset the costs of the credit business at the expense of a high effective interest rate.
The Russian Standard financial group (consisting of Russian Standard Bank, subsidiaries and SPE) summed up its activities for 2006. According to the IFRS consolidated financial statements under IFRS, the largest contribution to the formation of the final financial results was made by the bank, which changed the composition of the loan portfolio, shifting the focus towards credit cards.
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The group's profit before tax was 19.5 billion rubles compared to 7.5 billion in 2005. Also in 2006, the bank significantly increased the volume of lending to individuals. According to the balance, in 2006 the total volume of loans to citizens reached 163.7 billion rubles as against 98.7 billion in 2005. The volume of issued card loans for the year was equal to 99.4 billion, while the volume of consumer loans was only 79.3 billion.
In its reporting, Russian Standard decided to disclose the effective rate - previously banks did not do this. According to reports, on credit cards, it was 79.2%. Analysts point out that the effective credit card rate shown by the Russian Standard in IFRS reporting is much higher than the effective rate on ordinary consumer loans (44.3%). “The increase in card loans is one of the main trends of the recent times,” explains Mikhail Galkin, an analyst at MDM Bank. “Banks can afford to set higher rates for card products.”
Source: Dengin.ru
The Russian Standard financial group (consisting of Russian Standard Bank, subsidiaries and SPE) summed up its activities for 2006. According to the IFRS consolidated financial statements under IFRS, the largest contribution to the formation of the final financial results was made by the bank, which changed the composition of the loan portfolio, shifting the focus towards credit cards.
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The group's profit before tax was 19.5 billion rubles compared to 7.5 billion in 2005. Also in 2006, the bank significantly increased the volume of lending to individuals. According to the balance, in 2006 the total volume of loans to citizens reached 163.7 billion rubles as against 98.7 billion in 2005. The volume of issued card loans for the year was equal to 99.4 billion, while the volume of consumer loans was only 79.3 billion.
In its reporting, Russian Standard decided to disclose the effective rate - previously banks did not do this. According to reports, on credit cards, it was 79.2%. Analysts point out that the effective credit card rate shown by the Russian Standard in IFRS reporting is much higher than the effective rate on ordinary consumer loans (44.3%). “The increase in card loans is one of the main trends of the recent times,” explains Mikhail Galkin, an analyst at MDM Bank. “Banks can afford to set higher rates for card products.”
Source: Dengin.ru
Source: https://habr.com/ru/post/6377/
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