Tinkoff FY2019 earnings represent another record year for the Russian lender.
In particular, net income rises by 33% to RUB36.1bn ($504.3m).
Tinkoff ends fiscal 2019 with over 7.1 million current account customers, up by 57% and over 535,000 SME customers.
Meantime, total assets are up by 54% to RUB579.5bn.
Tinkoff FY2019 highlights
In 2019, net loans rise by 66% to RUB329.2bn boosted by 4.3 million new credit accounts. The bank’s non-credit business lines continue to deliver robust growth. Specifically, they now account for over 36% of group revenue.
Fee and commission income rises by 37% year-over-year in the fourth quarter, accounting for 21% of total revenue.
At the same time, Tinkoff Insurance more than doubles its year-over-year revenue. On the other hand, the bank’s non-performing loan ratio rises to 9.1%.
“While continuing to innovate, we remain one of the most profitable banks in the world, with ROE at 55.9%. We continue to focus on our bottom line as we expand our lifestyle and financial offering,” says CEO Oliver Hughes.
In December, the Tinkoff super app launched, designed to meet almost any financial, leisure or lifestyle need users may have.
Also in December, Tinkoff rolled out Russia’s first fully digital ATM. Dubbed ‘Kesha’, it features a 32-inch screen and does away with a physical keyboard and receipt printing.
Tinkoff also announced plans to invest in a new venture project to set up a fintech company. This provides non-credit financial products to retail customers in Europe (excluding CIS).
Tinkoff FY2019 looking ahead
The bank forecasts net loan growth of at least 20% in fiscal 2020. It expects the cost of risk to be in the region of 9% with cost of borrowing of around 6%. On net income, Tinkoff forecasts a rise to at least RUB42bn.
Meantime, Tinkoff is ramping up its marketing efforts. For example, the bank is now the title sponsor of the Russian Football Premier League.
“We hope this will help us further build customer loyalty, attract new customers,” adds Hughes. And it provides expanded possibilities for purchasing football tickets within the Tinkoff SuperApp.”
Tinkoff resumes dividend payments with a first interim gross cash dividend for 2020 of $0.21 per share.
Tinkoff FY2019: share price dips
Release of the Tinkoff FY2019 earnings are to an extent overshadowed by negative PR relating to its founder.
Oleg Tinkov holds a 40% stake in the London-listed parent of Tinkoff Bank. In February, Tinkov said that he was undergoing chemotherapy for leukemia.
In addition, Tinkov faces possible extradition to the US on alleged charges of tax evasion. Shares in TCS, listed parent group of Tinkoff Bank are down by over 30% since early February from $26 to $17.