Rietumu Success in Figures and Facts

Transcription

1 Rietumu Bonds

2 Rietumu Success in Figures and Facts One of the largest private banks in the Baltic States offering services to corporate clients and wealthy individuals. Key Financial data for the period ended 3 June 215 Over 2 years of successful operating experience in the Baltic states, CIS, Europe and Asia. Operating in more than 4 countries worldwide. Assets (EUR mil) Share Capital (EUR mil) Services provided in five languages, including English and Russian. Comprehension of the East and Western business environment and practices. Full support of clients in the international financial markets. Most recent banking technologies. Extensive experience in granting the loans in the Baltic states, Russia, Belarus, Kazakhstan and other CIS countries. Capital adequacy ratio 19.4% Liquidity ratio 76.5% Loan to assets ratio 31.3% Return on equity 21.34% Cost to income ratio 3.61%

3 Main macroeconomic indicators of Latvia GDP Inflation Unemployment rate Average monthly wage growth Since 211, the economic expansion in Latvia has been one of the fastest among EU countries. In 214, the growth continued, albeit at a slower pace. In September 215, inflation dropped by -.1% on a monthly basis, while annual inflation declined by -.5%. Nevertheless, Latvian Ministry of Finances projects inflation to reach 2% level in 216. A steady drop in unemployment and a gradual pickup in wages foster a boost in private consumption. Despite weak growth numbers in the Euro area, and substantial turbulence in the Russian economy, one of the major trading partners of Latvia, improvements in the domestic labor market will support the domestic demand.

4 Economic tendencies in EU Target 2% Annual inflation rate (%) Real GDP growth (%) Euro area annual inflation turned negative in August 215, falling.1% from a year earlier. EU annual inflation was at.%, down from.2% a month earlier. The European Commission now expects inflation to rise by.1% in 215, before rising 1.5% in 216, still below the ECB s target of a little below 2%. After contracting in 212 and stagnating in 213, GDP in the EU is expected to rise 1.8% in 215 and 2.1% in 216, according to the European Commission The yields on EU government bonds fluctuating around record lows amid ECB s announcement of a EUR 1.1 trillion quantitative easing Real GDP growth EC forecast Euro area yield curve (%) months 9 months 1 year 2 years 3 years 4 years 5 years AAA rated bonds All bonds

5 Rietumu - financial highlights м м м 647м 18м H 215 ASSETS For many years Rietumu is one of the leading banks in Latvia м 44м 1.8м H 215 SHARE CAPITAL The growing capital of the Bank reflects a significant position in the financial markets м 954м 588м 15м H 215 DEPOSITS Continuous growth of deposits proves trust of our customers м 812м 191м.7м H 215 LOANS During the last ten years Rietumu significantly expanded its financial lending projects in Russia and other CIS countries

6 Rietumu financial highlights H Net interest income Net fee income Net trading income Other income Net operating profit Administrative expenses Impairment losses Profit before tax Tax Net Profit In 213 the Bank has reached profitability ratios of 27 and thereafter continue to improve profitability. Bank demonstrates resilient growth in net interest and fee income. Improvement in net profit driven both by a solid increase in net operating income and lower administrative expenses. The Bank aims to maintain its cost to income ratio at a low level.

7 Rietumu financial highlights (II) H Total assets Loans Securities Deposits Equity ROE 13.51% 22.58% 24.1% 21.94% - Liquidity ratio 62.% 65.97% 77.65% 76.59% - Capital adequacy 19.51% 18.49% 18.91% 19.4% - Loans to assets 42.98% 4.26% 31.31% 31.79% Despite the active growth of the lending portfolio, the Bank maintains a conservative approach to its assets structure management, and aims to keep the share of the lending portfolio in total asset below 5%. The growth of customer deposits in the Bank indicate a positive trend. Since 211 customer deposits increased by 82% and as of 3 June 215 comprised of million euros. As of 3 June 215 the Tier 1 capital adequacy ratio was 12.33%, total capital adequacy ratio was 19.4%. The Bank plans to keep high capital adequacy ratios which allows for financial stability.

8 Balance sheet structure Total assets (EUR mil) Total liabilities (EUR mil) Cash and balances with the central bank (23%) Loans and receivables due from banks (18%) Current account and deposits due to customers (88%) Loans and receivables due from customers (32%) Reverse repo (3%) Securities portfolio (19%) Shareholders equity (8%) Other assets (5%) Other liabilities (4%)

9 Regulatory capital Regulatory capital growth dynamic Regulatory capital (EUR ') Capital adequacy ratio (%) Regulatory capital of the Bank demonstrates stable growth and was 381 million euros as of 3 June 215 Growth of the capital and efficient investment policy are the main factors in the growth of the capital adequacy ratio

10 Rietumu Liquidity One of the main elements that ensures stability is effective liquidity management Liquidity portfolio structure as of 3 June 215 The Bank focuses on building a portfolio of highly liquid assets. 77% 9% 7% 7% Due from banks Cash and balances with the Central Bank Reverse Repo Securities The Bank s liquidity management is focused on maintaining the optimum balance between the amount of liquid assets, the returns and risks. Effective management of liquid assets allows the Bank to maintain a stable liquidity ratio which as of 3 June 215 was 76.59%. 9% 8% 7% 6% 5% 4% 3% 2% 1% Liquidity ratio dynamic The Bank performs regular stress testing of the structure of bank assets and liabilities enabling the Bank to cope with a crisis without incurring significant losses. %

11 Why bonds? Bond offer higher interest rates in comparison with term deposits. Especially important in current low interest rate environment. Amid weak global economic conditions, central banks around the globe are likely to keep ultra loose monetary policy for the next couple of years, therefore, interest rates will remain around record-low. Perfectly suits for investors with low risk appetite Provide flexible tenure- usually from 1 to 1 years. Offered different interest frequency. Bank issued bonds are listed and traded on NASDAQ OMX Riga stock exchange. Investors gets an opportunity to receive financing against pledge of bonds issued by Rietumu bank (up to 9% from market value). Priority of payment in liquidation Lowest risk Term Deposits Senior Bonds Subordinated Bonds Hybrids Equity Highest risk

12 Security description Issuer Description Number of the Bonds Face value Initial placement price Public offer start date Public offer end date Issue date Final Maturity Optional Redemption Annual Interest Rate Frequency and dates of the interest income payments Regulated market JSC Rietumu Banka EUR Senior Unsecured Bonds No 2.% Semiannual, every 1th of June and December starting from 1th of June of 216 till final maturity Stock Exchange NASDAQ OMX Riga, Baltic list of debt securities

13 Security description Issuer Description Number of the Bonds Face value Initial placement price Public offer start date Public offer end date Issue date Final Maturity Optional Redemption Annual Interest Rate Frequency and dates of the interest income payments Regulated market JSC Rietumu Banka USD Senior Unsecured Bonds No 2.25% Semiannual, every 1th of June and December starting from 1th of June of 216 till final maturity Stock Exchange NASDAQ OMX Riga, Baltic list of debt securities

14 Rietumu Bank listed bonds Name Coupon Issued Maturity Nominal ISIN Rietumu Banka EURSB-1 7% ,. EUR LV8993 Rietumu Banka USDSB-1 7% ,. USD LV819 Rietumu Banka USDSB-2 7% ,. USD LV8125

15 Disclaimer This Warning should be perused by the Investors in view of its importance INFORMATION DESCRIBED HEREIN IS INDICATIVE ONLY AND IS SUBJECT TO POSSIBLE AMENDMENTS MADE BY FURTHER DEVELOP- MENTS AND CHANGE OF CIRCUMSTANCES OR/AND BY A FINAL DOCUMENTATION. The financial data of the Issuer mentioned in the Presentation is accurate on the Presentation date, but is subject to change made by the changes in the future financial position of the Issuer. Presentation contains a number of statements, assessments and forecasts (forward-looking statements), provided by the Management of the Issuer with regard to the expected financial and operational performance of the Issuer. These statements, assessments and forecasts were prepared based on certain assumptions and analysis, which were available to the Management on the Presentation date, but could appear materially inaccurate. No assurance, guarantees or affirmation is given, directly or indirectly, that those forward-looking statements will be implemented. Such forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from such statements. The main goal of the Presentation, as well as the Base Prospectus and Final Terms of JSC Rietumu Banka Bonds Offer Programme, is to provide information required for the potential Investors to take a decision regarding acquisition of the issued/or to be issued bonds (hereinafter referred to as Bonds ). Each Investor considering the possibility of acquiring Bonds should independently analyse the financial status, including the credit capacity, of the Issuer. The Presentation in itself is neither an offer nor an invitation of the Issuer to conclude a transaction on acquisition of Bonds. Neither the Presentation nor other information and documents related to issue of Bonds can be considered the Issuer s recommendation or a solicitation for acquiring Bonds.

16 Disclaimer The Presentation cannot be used as an offer or an instrument for considering an offer of Bonds acquisition by anyone in the jurisdictions where such offer is not allowed or by persons whom such offer of Bonds acquisition may not be legally made. The offer and acquisition of Bonds, as well as distribution of the Presentation, is restricted or prohibited by law in some jurisdictions. The persons who receive the Presentation have to inform the Issuer on any existing restrictions with regаrd to their participation in the Bonds acquisition offer, and such persons have to strictly observe the restrictions applicable to them. Investments in Bonds involve certain financial risks which are undertaken by the Investor. These risks are related to the financial position of the Issuer, the investment instrument and the securities market conditions. More detailed information on such risks is provided in the Base Prospectus of JSC Rietumu Banka Bonds Offer Programme The Investors shall be aware that no third party has guaranteed this issue or gave any other indemnities in this respect. Each Investor may be exposed to such risks related to the issue and should carefully consider and weigh up all these before acquiring Bonds. Prior to investing funds into Bonds, the Investor should be confident that the issue parameters meet his/her/its personal requirements. THE PRESENTATION SHALL BE CONSIDERED BY THE INVESTOR EXCLUSIVELY IN CONJUNCTION WITH THE BASE PROSPECTUS AND FINAL TERMS OF JSC RIETUMU BANKA BONDS OFFER PROGRAMME.