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Halyk Bank Releases 2Q2020 Consolidated Financial Results


21 August 2020, Almaty - Joint Stock Company Halyk Savings Bank of Kazakhstan and its subsidiaries (Halyk Bank, hereinafter referred to as the “Bank”) announced its performance for 2nd quarter of 2020.

“In the second quarter of 2020, the banking sector, like the economy of Kazakhstan as a whole, was influenced by the volatility of world markets and the consequences of the COVID-19 pandemic announced by WHO, the quarantine arrangements and restrictive quarantine measures that were in force during this period. Despite the challenges of the lockdown, Halyk Bank quickly catered to the new conditions and mobilized its efforts to ensure the continuity of business processes so that all customers have round-the-clock access to all necessary banking services, products and operations. With sufficient practical experience and the necessary resources, the Bank took an active part in the implementation of government support measures aimed at mitigating the impact of the state of emergency on the population and business. Based on the measures taken, as well as the efficiently organized business model of the Bank, along with sufficient reserves, the best financial strength ratings among second-tier Kazakh banks without foreign participation, Halyk Bank continues its confident onward movement, effectively and efficiently, using existing resources and new technological processes", - said Umut Shayakhmetova, Halyk Bank’s CEO.

Net profit According to the National Bank of Kazakhstan data on an unconsolidated basis, excluding banks with negative income, the Bank's profit continues to be the highest in the Kazakh banking sector, while the Bank's profit on a consolidated basis amounted to 74.9 billion tenge.

Interest income increased by 0.3% to KZT 180.5 billion in 2Q2020 vs. 179.9 billion tenge for 2Q2019, mainly due to the growth of average balances of interest-bearing assets. Interest expenses decreased by 7.4% vs. 2Q2019. Compared to 2Q2019, the net interest margin decreased by 0.1% as a result of a decrease in the interest rate on foreign exchange interbank deposits and an increase in the share of placement in lower-yielding foreign exchange instruments.

Loan loss expenses increased to 1.0% from 0.3% in 2Q 2019 due to the allowance for expected loan losses, reflecting the increased risk and uncertainty associated with the COVID-19 outbreak and quarantine restrictions.

Service and commission income decreased by 4.2% vs. 2Q2019 as a result of a decrease in income from cash transactions in 2Q2020 due to the quarantine effect of COVID-19 and the cancellation of certain fees associated with payment card transactions.

Service and commission expenses increased by 12.2% vs. 2Q2019 due to the growth of service fees in favor of international payment systems as a result of the growth of non-cash transactions.

As of the end of 2Q2020, total assets increased by 5.4% against the end of 2019 due to the growth of deposits and capital. While a decrease of 3.0% vs. the end of 1Q2020 is due to revaluation of the balance sheet currency positions as a result of strengthening KZT vs. USD during 2Q2020 and a decrease in the volume of funds raised under REPO transactions.

Amounts due to legal entities and individuals increased by 4.1% and 6.7%, respectively, compared to the end of 2019, mainly due to the inflow of funds from the Bank's customers and due to the positive revaluation of foreign currency deposits associated with the depreciation of KZT against USD in 1H2020. As of the end of 2Q2020, the share of KZT-denominated corporate deposits in the total amount of deposits made up 56.7% vs. 50.8% at the end of 1Q2020, while the share of KZT-denominated retail deposits in the total amount of deposits amounted to 43.6% vs. 37.6% at the end of 1Q2020.

Amounts due to credit institutions decreased by 35.3% vs. the end of 1Q2020 mainly due to the decrease in loans under repurchase agreements to ensure the current flow of KZT payments in the course of the Bank's operations. As of 30 June 2020, 77.3% of the Bank's liabilities to financial institutions consisted of loans raised from JSC National Managing Holding KazAgro, JSC Entrepreneurship Development Fund Damu and JSC Development Bank of Kazakhstan within the framework of government programs to support certain sectors of the economy.

Issued securities decreased by 5.8% vs. the end of 1Q2020, as a result of revaluation of debt securities in foreign currency associated with strengthening of KZT against USD in 2Q2020.

The consolidated financial information for 6 months ended 30 June 2020, including notes, is available on the Bank's website at:

Halyk Bank is a leading financial group in Kazakhstan, operating in various segments including retail, SME and corporate banking, insurance, leasing, brokerage and asset management. The Bank has been listed on the Kazakhstan Stock Exchange since 1998, on the London Stock Exchange since 2006 and on the Astana International Exchange since October 2019. With assets of 9,731.2 billion tenge as of 30 June 2020, the Bank is the leading credit institution in Kazakhstan. The Bank has the largest customer base and branch network - 621 branches and offices across the country. The Bank operates in Georgia, Kyrgyzstan, Russia, Tajikistan and Uzbekistan.


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