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Public relations section
All figures are based on International Financial Reporting Standards (IFRS).
After a challenging year, the Group ended the reporting year with a positive profit before tax of € 23 million. Despite the currency turmoil and geopolitical tensions, the operating result in the amount of € 2.332 million was marginally below the previous year’s level, with a decline of 2 per cent year-on-year. The decline in profit before tax of € 812 million to € 23 million was primarily attributable to a number of one-off effects: A legislative change in Hungary entailed a one-off effect with a negative impact of € 251 million on the Group's results. At the same time, € 533 million in net provisioning for impairment losses was required in Ukraine, which was thus € 412 million above the previous year's level. Goodwill impairments totaling € 306 million were required for Group units in Russia and Poland as a result of lower medium-term earnings expectations, and in Albania due to a change in the discounting factor. The Group's loss after tax was € 463 million – not least due to impairments recognized on deferred tax assets in the amount of € 196 million owing to a tax planning revision at Group head office and in Asia. Taking profit attributable to non-controlling interests into account, which decreased € 16 million to minus € 30 million, the Group had a consolidated loss of € 493 million for the year.
Due to the negative result, RBI AG will not distribute a dividend on shares and on participation capital for the financial year 2014.
Net interest income increased 2 per cent
Operating income fell 7 per cent, or € 373 million, to € 5,355 million year-on-year, while the net interest margin improved 13 basis points to 3.24 per cent due to lower refinancing costs at Group head office.
Net interest income increased 2 per cent, or € 60 million, to € 3,789 million in 2014. This was primarily attributable to a positive development in Russia and at Group head office.
General administrative expenses fell 9 per cent
The Group's general administrative expenses fell 9 per cent, or € 316 million, to € 3,024 million during the reporting period, largely attributable to the currency development of the Russian rouble and Ukrainian hryvnia. In addition, ongoing cost reduction programs in the Czech Republic and Poland, as well as lower depreciation in the Czech Republic, led to a reduction in general administrative expenses. The cost/income ratio improved 1.8 percentage points to 56.5 per cent.
Net provisioning for impairment losses rose 49 per cent
Net provisioning for impairment losses rose 49 per cent, or € 567 million, to € 1,716 million year-on-year. This was mainly due to the situation in Ukraine, which was impacted by the depreciation of the hryvnia, and by the challenging overall macroeconomic environment, leading to an increase in net provisioning for impairment losses of € 412 million to € 533 million. Asia also contributed to the increase, with defaults by large corporate customers resulting in an increase of € 215 million to € 291 million. In contrast, the credit risk situation improved in most other markets.
Common equity tier 1 ratio (transitional) of 10.9 per cent
The excess cover ratio was 100.2 per cent compared to 98.5 per cent as at the end of 2013, which was attributable to the decrease in the total capital requirement. Based on total risk, the common equity tier 1 ratio (transitional) was 10.9 per cent, with a total capital ratio (transitional) of 16.0 per cent.