Financial Statement of JSC ?Temirbank? for 2007, Current Position and Prospects

On 1st April, 2008 Temirbank held the press-conference where Temirbank presented to the public its 2007 financial results and its assessment of the current situation in the banking sector of Kazakhstan.

At the press-conference held today in Almaty, Temirbank was represented by:

• Ablahat KEBIROV, Ñhairman of the Board.
• Erulan KUSAYINOV, Ìember of the Board, Ìanaging director.
• Yerzhan SHAIKENOV, Ìember of the Board, Ìanaging director.
• Mukhtar BEKKALI, Ìanaging director.
• Ashat ESTAEV, Ìanaging director.

The results of 2007 show that the bank is actively developing by steadily gaining an ever-increasing share of the retail sector including lending, deposits, cash payments, transfers, card business and related internet- and mobile banking. The bank?s share in the retail segment increased from 6.4% at the beginning of 2007 to 7.8% at the end of 2007. It is expected that by 2008 the bank reaches least 9% market share.

According to the chairman of the management board of Temirbank Ablakhat Kebirov, stability of the bank?s position in the market and the excellent growth in terms of financial and economic performance, even under especially unfavorable conditions of the financial markets the 2nd half of 2007, proved that a strategy aimed at development of the retail banking is proper, right and correct.

The key factor that allowed the bank to achieve the success in such a short period of time is the properly developed and implemented strategy of development, aimed at introduction of innovative approaches into the systems of personnel, process and technology management. In 2007 the bank migrated to a new generation of the banking system (RBO), finished full centralization of accounting and reporting, introduced automated loan origination system. During the year the bank created a network of ATM?s, info-kiosks and POS-terminals (by the end of the year the number of automated teller machines was 142 (2006: 18), info-kiosks- 33 (2006: 0), POS-terminals - 275 units (â 2006: 200). The important stage of the Bank development was transition of plastic payment services to its own processing which made it possible for the bank to increase the types of banking services.

Presently, by assets the bank holds strong 7th place of all the Kazakhstani banks. According to the audited consolidated financial statements carried out in accordance with IFRS, the assets of ?Temirbank? JSC for 2007 increased by 64,5%, from 202,9 billion KZT to 333,9 billion KZT, net profit of the bank reached 7,4 billion KZT, which is 2,85 times more than the one for the year 2006 (2,6 billion KZT), the equity of the bank increased for more than two times as compared to January 1, 2007 figure (21,9 billion KZT) and reached 48,3 billion KZT. ROA (return on assets) was 2,75% (2006: 1,86%), while ROE (return on the equity capital) was 21% (2006: 16%)

The loan portfolio at the end of 2007 increased by 80,9% and reached 274,8 billion KZT. In 2007 the bank issued loans for 203,9 billion KZT, which is 1,8 times higher than the same figure for 2006 (115,6 billion KZT). The management note indicated that the 2nd half of the year the volume of issued loans was lower than in the 1st half of the year because of the general situation in financial market of Kazakhstan and abroad.

Temirbank pays a lot of attention to the breadth and the width of credit and deposit products, as well as to the development of innovative technologies such as internet- and mobile banking, card products. This was one of the key factors of success on the Kazakhstani market. Another important factor was the development of regional office-, the bank increased the number of branches to 21 (in 2006 the bank had 19 branches), and the centers of bank services to 119 (71 in 2006).

The Bank actively participates in ?Kazyna? Fund of Sustainable Development programs, and Kazakhstani Mortgage Company (KMC) programs, as well as in the programs of the Fund for Development of Small and Medium Business, European Bank for Reconstruction and Development (EBRD), Asian Bank of Development (ABD) and International Bank for Reconstruction and Development (IBRD).

In the near future the bank plans to pay special attention to the development of new services, such as internet- and mobile banking. In 2008 the bank plans to increase the number of plastic cards to 350 thousand and significantly widen the scope of services provided through such cards.

Current ratings:

Fitch. Long-term ÂÂ-, short-term Â, individual D/E, supportive 3, stable forecast.

Moody`s. Long-term deposits Âà2/NP, short-term N/P, subordinated debentures in foreign currency Âà3, financial statements E+, negative forecast.

Standard&Poor`s. Long-term Â+, short-term Â, in national scale KzBBB+, forecast negative.


05.04.2008 11:25