* TCS posts 2.5 bln roubles in second-quarter net profit
* Record profits also beat analyst forecasts
* Net interest income up 48 pct year-on-year
* State-owned rival Sberbank also made record profit
By Kira Zavyalova
MOSCOW, Sept 6 Russian consumer lender TCS Group
reported a record quarterly net profit for the three
months to the end of June on Tuesday thanks to an improvement in
profitability and a lower cost of risk.
At 2.5 billion roubles ($38.6 million), its quarterly net
profit came in well above the average 2 billion forecast in a
Reuters poll of analysts, and was up from just 0.4 billion
roubles in the same period a year ago.
Russia's banking sector was hit hard by a weak rouble and
Western sanctions which limited ability to raise funds abroad or
made borrowing costs too high, forcing the state to recapitalise
some of its biggest banks to keep the system alive.
TCS, one of Russia's 50 biggest banks by assets, is
52-percent owned by Oleg Tinkov, a former professional cyclist
who owns the Tinkoff cycling team, with small stakes in the bank
also being held by investment funds and Goldman Sachs.
The bank runs a different business model to most of its
rivals by just targeting Russian retail clients and operating
chiefly online, or by offering its credit cards to customers at
the grocery store counters.
The bank said net interest income rose 48 percent
year-on-year to 9.3 billion roubles. Its net interest margin - a
measure of profitability showing the difference between deposit
and lending rates - was 29.6 percent, or a rise of 400 basis
It said its cost of risk was down to 7.7 percent in the
second quarter from 16.4 percent in the same period a year ago,
which also boosted profits.
"Credit cards margin was up by 1 percentage point which was
likely driven by active lending. At the same time, deposits
became cheaper," Uralsib analyst Natalia Berezina said, adding
that there was also an improvement in credit card loans.
TCS is a relatively small player in the Russian banking
sector but one of a few listed banks. It is the second-biggest
player in the credit card market with a share of just under 10
percent, behind Sberbank, Russia's biggest bank.
Last month, Sberbank posted a second-quarter net profit of
145 billion roubles, also setting a new record on the back of
stronger interest income and lower risk costs.
VTB, Russia's second biggest bank, is on track to
meet its optimistic scenario with net profit of 50 billion
roubles this year, rather than the pessimistic one with profit
near to zero, Chief Executive Andrei Kostin said last week.
"Some improvement in the overall picture is being seen. The
worst is behind," Uralsib's Berezina said.
($1 = 64.8099 roubles)
(Writing by Katya Golubkova; editing by David Clarke)