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«Тинькофф Банк». Консолидированная финансовая информация (2019 год) - часть 3

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Segment Analysis (Continued)

Segment reporting of the Group’s income and expenses for the three months ended 31 March 2019 is set
out below:

Unaudited

In millions of RR

Retail

banking

SME

accounts

services

Insurance

operations

MVNO

services

Elimina-

tions

Total

Three months ended 31 March 2019

Revenues

Interest income calculated using the

effective interest rate method

22,074

611

(46)

22,718

Other similar income

103

Fee and commission income

SME current accounts commission

1,832

Credit protection fee

1,546

Merchant acquiring commission

1,494

(12)

1,524

SMS fee

719

Interchange fee

517

137

654

Foreign currency exchange
transactions fee

523

583

Card to card commission

302

Cash withdrawal fee

162

Income from MVNO services

155

(36)

119

Brokerage operations

Mortgage agency fee

Marketing services fee

Placement fee

Other fees receivable

117

(10)

107

Timing of fee and commission income

recognition:

- At point in time

5,084

2,053

155

(58)

7,234

- Over time

517

535

Total fee and commission income

5,601

2,071

155

(58)

7,769

Net gains from disposals of debt

securities at FVOCI

Net gains from debt instruments at

FVTPL

387

Insurance premiums earned

2,312

(55)

2,310

Other operating income

930

(10)

1,021

Total revenues

29,156

2,697

2,477

155

(169)

34,316

Interest expense calculated using the

effective interest rate method

(4,056)

(251)

(26)

(4,287)

Other similar expense

(33)

Expenses on deposit insurance

(352)

(50)

(402)

Credit loss allowance for loans and

advances to customers

(4,817)

(34)

(4,851)

Credit loss allowance for debt

securities at FVOCI

Fee and commission expense

(2,919)

(368)

(123)

(3,374)

Customer acquisition expense

(3,817)

(511)

(223)

(183)

(4,657)

Net losses from operations with

foreign currencies

(247)

(4)

(251)

Insurance claims incurred

(822)

Administrative and other operating

expenses

(5,224)

(729)

(305)

(165)

(6,413)

Segment result

7,730

754

1,123

(342)

9,265

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Segment Analysis (Continued)

Segment reporting of the Group’s assets and liabilities as at 31 December 2018 is set out below:

In millions of RR

Retail

banking

SME

accounts

services

Insurance

operations

MVNO

services

Elimina-

tions

Total

Cash and cash equivalents

19,621

13,110

3,537

(2,481)

33,802

Mandatory cash balances with the CBRF

2,435

Due from other banks

776

Loans and advances to customers

199,513

330

386

(1,740) 198,489

Financial derivatives

1,710

Investments in debt securities

68,375

30,394

1,371

100,140

Repurchase receivables

1,182

Guarantee deposits with payment systems

4,603

Current income tax assets

1,104

Tangible fixed assets

8,280

8,369

Intangible assets

3,214

547

264

198

4,223

Other financial assets

15,316

173

542

(435)

15,642

Other non-financial assets

2,344

618

150

(88)

3,024

Total reportable segment assets

327,697

44,554

7,494

498

(4,744) 375,499

Due to banks

2,708

1,344

(1,344)

2,708

Customer accounts

242,092

41,702

(2,878) 280,916

Debt securities in issue

9,605

Financial derivatives

Current income tax liabilities

Deferred income tax liabilities

1,821

Subordinated debt

20,644

Insurance provisions

2,859

Other financial liabilities

9,746

1,711

213

(469)

11,201

Other non-financial liabilities

3,367

(53)

3,441

Total reportable segment liabilities

290,037

41,702

4,633

1,621

(4,744) 333,249

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Segment Analysis (Continued)

Segment reporting of the Group’s income and expenses for the three months ended 31 March 2018 is set out
below:

Unaudited

In millions of RR

Retail

banking

SME

accounts

services

Insurance

operations

MVNO

services

Elimina-

tions

Total

Three months ended 31 March 2018

Revenues

Interest income calculated using the effective

interest rate method

17,209

374

(17)

17,609

Other similar income

103

Fee and commission income

SME current accounts commission

1,249

Credit protection fee

1,576

Merchant acquiring commission

904

(70)

834

Interchange fee

514

105

619

SMS fee

498

Foreign currency exchange transactions fee

316

353

Card to card commission

184

Cash withdrawal fee

202

Mortgage agency fee

Brokerage operations

Placement fee

Other fees receivable

111

Timing of fee and commission income

recognition:

- At point in time

3,966

1,367

(70)

5,263

- Over time

498

522

Total fee and commission income

4,464

1,391

(70)

5,785

Net gains from disposals of debt securities at

FVOCI

271

Insurance premiums earned

1,158

Other operating income

497

(1)

506

Total revenues

22,544

1,771

1,201

(88)

25,432

Interest expense calculated using the

effective interest rate method

(3,246)

(190)

(6)

(3,425)

Expenses on deposit insurance

(223)

(18)

(241)

Credit loss allowance for loans and advances

to customers

(3,221)

Credit loss allowance for debt securities at

FVOCI

(20)

Fee and commission expense

(1,856)

(138)

(13)

(2,007)

Customer acquisition expense

(2,771)

(629)

(144)

(7)

(3,481)

Net losses from operations with foreign

currencies

(461)

Net gains/(losses) from debt instruments at

FVTPL

(18)

Insurance claims incurred

(341)

Administrative and other operating expenses

(4,095)

(459)

(194)

(70)

(4,817)

Segment result

6,633

337

522

(92)

7,400

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Segment Analysis (Continued)

Reconciliation of reportable segment revenues, profit or loss, assets and liabilities

Unaudited

In millions of RR

Three Months

Ended

31 March 2019

Three Months

Ended

31 March 2018

Total revenues for reportable segments

34,485

25,520

Intercompany transactions

(169)

(88)

Total consolidated revenues

34,316

25,432

Total consolidated revenues comprise interest income calculated using the effective interest rate method,
other similar income, fee and commission income, net gains from disposals of debt securities at FVOCI,
insurance premiums earned and other operating income.

Unaudited

In millions of RR

Three Months

Ended

31 March 2019

Three Months

Ended

31 March 2018

Total reportable segment result

9,265

7,400

Profit before tax

9,265

7,400

In millions of RR

31 March 2019

(Unaudited)

31 December

2018

Total reportable segment assets

414,170

380,243

Intercompany balances

(5,277)

(4,744)

Total consolidated assets

408,893

375,499

In millions of RR

31 March 2019

(Unaudited)

31 December

2018

Total reportable segment liabilities

367,226

337,993

Intercompany balances

(5,277)

(4,744)

Total consolidated liabilities

361,949

333,249

Management of Capital

The Group’s objectives when managing capital are (i) for the Bank to comply with the capital requirements
set by the Central Bank of Russian Federation (CBRF), (ii) for the Insurance Company to comply with the
capital requirements set by the legislation of the Russian Federation, (iii) for the Group to comply with the
financial covenants set by the terms of securities issued; (iv) to safeguard the Group’s ability to continue
as a going concern.

The Group considers total capital under management to be equity attributable to shareholders of the Company
as shown in the consolidated condensed interim statement of financial position. The amount of capital that the
Group managed as of 31 March 2019 was RR 46,707 million (31 December 2018: RR 42,014 million).

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Management of Capital (Continued)

Compliance with capital adequacy ratios set by the CBRF is monitored daily and submitted to the CBRF
monthly with reports outlining their calculation reviewed and signed by the Bank’s Chief Executive Officer
and  Chief  Accountant.  Other  objectives  of  capital  management  are  evaluated  annually.  The  amount  of
regulatory  capital  of  Tinkoff  Bank  calculated  in  accordance  with  the  methodology  set  by  CBRF  as  at
31 March 2019  was  RR  78,510  million,  and  the  equity  capital  adequacy  ratio  (N1.0)  was  12.97%
(31 December 2018: RR 74,375 million and 13.92%). Minimum required statutory equity capital adequacy
ratio (N1.0) was 8% as at 31 March 2019 (31 December 2018: 8%).

The  Group  also  monitors  capital  requirements  including  capital  adequacy  ratio  under  the  Basel  III
methodology  of  the  Basel  Committee  on  Banking  Supervision:  global  regulatory  framework  for  more
resilient banks and banking systems (hereinafter “Basel III”). The amounts of total capital and Tier 1 capital
calculated in accordance with the methodology set by Basel Committee with capital adjustments as set out
in Basel III as at 31 March 2019 were RR 61,516 million (31 December 2018: RR 58,435 million). Total
capital adequacy ratio and Tier 1 capital adequacy ratio were 14.03% (31 December 2018: 14.86%).

The Group and the Bank have complied with all externally imposed capital requirements throughout the
three months ended 31 March 2019 and year ended 31 December 2018.

The Insurance Company has complied with all capital requirements set by the legislation of the Russian
Federation throughout the three months ended 31 March 2019 and the year ended 31 December 2018.

Contingencies and Commitments

Legal proceedings

. From time to time and in the normal course of business, claims against the Group

may be received. On the basis of its own estimates and internal professional advice, management is of the
opinion that no material unprovided losses will be incurred in respect of claims.

Tax contingencies.

Russian tax legislation which was enacted or substantively enacted at the end of the

reporting period, is subject to varying interpretations when being applied to the transactions and activities
of the Group. Consequently, tax positions taken by management and the formal documentation supporting
the tax positions may be challenged tax authorities. Russian tax administration is gradually strengthening,
including the fact that there is a higher risk of review of tax transactions without a clear business purpose
or with tax incompliant counterparties. Fiscal periods remain open to review by the authorities in respect of
taxes for three calendar years preceding the year when decision about review was made. Under certain
circumstances  reviews  may  cover  longer  periods.  The  Russian  transfer  pricing  legislation  is  generally
aligned  with  the  international  transfer  pricing  principles  developed  by  the  Organisation  for  Economic
Cooperation and Development (OECD), although it has specific features. This legislation provides for the
possibility  of additional tax  assessment for controlled transactions (transactions  between related parties
and certain transactions between unrelated parties), if such transactions are not on an arm's length.

Tax liabilities arising from controlled transactions are determined based on their actual transaction prices.
It is possible, with the evolution of the interpretation of transfer pricing rules, that such transfer prices could
be challenged. The impact of any such challenge cannot be reliably estimated; however, it may be
significant to the financial position and/or the overall operations of the Group.

The  Group  includes  companies  incorporated  outside  of  Russia.  The  tax  liabilities  of  the  Group  are
determined on the assumption that these companies are not subject to Russian profits tax, because they
do not have a permanent establishment in Russia. The Company is a tax resident of Cyprus only and full
beneficial owner of the Bank and Insurance Company.  This interpretation of relevant legislation may be
challenged but the impact of any such challenge cannot be reliably estimated currently; however, it may be
significant  to  the  financial  position  and/or  the  overall  operations  of  the  Group.  The  Controlled  Foreign
Company (CFC) legislation introduced Russian taxation of profits of foreign companies and non-corporate
structures (including trusts) controlled by Russian tax residents (controlling parties). The CFC income is
subject to a 20% tax rate if the CFC is controlled by a legal entity and a rate of 13% if it is controlled by an
individual.  As  a  result,  management  reassessed  the  Group’s  tax  positions  and  recognised  current  tax
expense as well as deferred taxes that arose from the expected taxable manner of recovery of the relevant
Group’s operations to which the CFC legislation applies to and to the extent that the Group (rather than its
owners) is obliged to settle such taxes.

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Contingencies and Commitments (Continued)

As Russian tax legislation does not provide definitive guidance in certain areas, the Group adopts, from
time to time, interpretations of such uncertain areas that reduce the overall tax rate of the Group. While
management currently estimates that the tax positions and interpretations that it has taken can probably be
sustained, there is a possible risk that outflow of resources will be required should such tax positions and
interpretations be challenged by the tax authorities. The impact of any such challenge cannot be reliably
estimated; however, it may be significant to the financial position and/or the overall operations of the Group.
As at 31 March 2019 and 31 December 2018 no material tax risks were identified.

Compliance with covenants.

The Group is subject to certain covenants related primarily to its

subordinated debt. Non-compliance with such covenants may result in negative consequences for the
Group. Management believes that the Group was in compliance with all such covenants as at 31 March
2019 and 31 December 2018.

Credit related commitments.

The primary purpose of these instruments is to ensure that funds are available

to a customer as required. Commitments to extend credit represent unused portions of authorizations to extend
credit in the form of credit card loans. With respect to credit risk on commitments to extend credit, the Group is
potentially exposed to loss in an amount equal to the total unused commitments, if the unused amounts were to
be drawn down. Most commitments to extend credit are contingent upon customers maintaining specific credit
standards.

The Group monitors the term to maturity of credit related commitments because longer-term commitments
generally have a greater degree of credit risk than shorter-term commitments.

Outstanding credit limits and related commitments are as follows:

In millions of RR

31 March 2019

(Unaudited)

31 December

2018

Unused limits on credit card loans

125,539

110,478

Credit loss allowance

(1,826)

(2,041)

Total credit related commitments, net of сredit loss allowance

123,713

108,437

The total outstanding contractual amount of unused limits on contingencies and commitments liability does not
necessarily represent future cash requirements, as these financial instruments may expire or terminate without
being funded. In accordance with credit card service conditions the Group has a right to refuse the issuance,
activation, reissuing or unblocking of a credit card, and is providing a credit card limit at its own discretion and
without explaining its reasons.

The following table contains an analysis of credit related commitments by credit quality at 31 March 2019
based on credit risk grades.

Unaudited

In millions of RR

Stage 1

(12-months

ECL)

Stage 2

(lifetime ECL for

SICR)

Stage 3

(lifetime ECL for

credit impaired)

Total

Credit related commitments

- Current

115,961

116,021

- Monitor

9,309

209

9,518

Unrecognised gross amount

125,270

269

125,539

Credit loss allowance

(1,812)

(14)

(1,826)

Unrecognised net amount

123,458

255

123,713

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Contingencies and Commitments (Continued)

The following table contains an analysis of credit related commitments by credit quality at 31 December

2018 based on credit risk grades.

In millions of RR

Stage 1

(12-months

ECL)

Stage 2

(lifetime ECL for

SICR)

Stage 3

(lifetime ECL for

credit impaired)

Total

Credit related commitments

- Current

101,418

101,489

- Monitor

8,827

162

8,989

Unrecognised gross amount

110,245

233

110,478

Credit loss allowance

(2,024)

(17)

(2,041)

Unrecognised net amount

108,221

216

108,437

Also the Group may decide to increase or decrease a credit card limit using a scoring model, which is based on

the client's behaviour model. Credit related commitments are denominated in RR. Therefore, the fair value of

the contractual amount of revocable unused limits on contingencies and commitments is close to zero.

Mandatory cash balances with the CBRF of RR 2,616 million (31 December 2018: RR 2,435 million)

represent mandatory reserve deposits which are not available to finance the Bank's day to day operations.

Fair Value of Financial Instruments

Fair value measurements are analysed by level in the fair value hierarchy as follows: (i) level one are

measurements at quoted prices (unadjusted) in active markets for identical assets or liabilities, (ii) level two

measurements are valuation techniques with all material inputs observable for the asset or liability, either

directly (that is, as prices) or indirectly (that is, derived from prices), and (iii) level three measurements are

valuations not based on observable market data (that is, unobservable inputs).

(a)

Recurring fair value measurements

Recurring fair value measurements are those that the accounting standards require or permit in the

consolidated statement of financial position at the end of each reporting period. The levels in the fair value

hierarchy into which the recurring fair value measurements are categorised are as follows:

31 March 2019 (Unaudited)

31 December 2018

In millions of RR

Level 1

Level 2

Level 3

Total

Level 1

Level 2

Level 3

Total

ASSETS AT FAIR VALUE

Financial derivatives

947

1,710

Investments in debt

securities

70,374

- 70,374

100,140

Repurchase receivables

24,812

- 24,812

1,182

Total assets recurring

fair value measurements

95,186

947

- 96,133

101,322

1,710

103,032

LIABILITIES AT FAIR

VALUE

Financial derivatives

Total liabilities recurring

fair value measurements

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Fair Value of Financial Instruments (Continued)

The description of valuation techniques and the description of the inputs used in the fair value measurement
for level 2 measurements at 31 March 2019 are as follows:

In millions of RR

Fair value

Valuation technique

Inputs used

ASSETS AT FAIR VALUE

Foreign exchange swaps
and forwards

947

Discounted cash flows
adjusted for counterparty
credit risk

Russian rouble curve.
USD Dollar Swaps Curve.
CDS quotes assessment of counterparty
credit risk or reference entities.

Total recurring fair value
measurements at level 2
(Unaudited)

947

LIABILITIES AT FAIR
VALUE

Foreign exchange swaps
and forwards

Discounted cash flows
adjusted for counterparty
credit risk

Russian rouble curve.
USD Dollar Swaps Curve.
CDS quotes assessment of counterparty
credit risk or reference entities.

Total recurring fair value
measurements at level 2
(Unaudited)

The description of valuation techniques and the description of the inputs used in the fair value measurement
for level 2 measurements at 31 December 2018 are as follows:

In millions of RR

Fair value

Valuation technique

Inputs used

ASSETS AT FAIR VALUE

Foreign exchange swaps
and forwards

1,710

Discounted cash flows
adjusted for counterparty
credit risk

Russian rouble curve.
USD Dollar Swaps Curve.
CDS quotes assessment of counterparty
credit risk or reference entities.

Total recurring fair value
measurements at level 2

1,710

LIABILITIES AT FAIR
VALUE

Foreign exchange swaps
and forwards

Discounted cash flows
adjusted for counterparty
credit risk

Russian rouble curve.
USD Dollar Swaps Curve.
CDS quotes assessment of counterparty
credit risk or reference entities.

Total recurring fair value
measurements at level 2

There were no changes in the valuation techniques for level 2 recurring fair value measurements during
the period ended 31 March 2019. Level 2 derivatives comprise foreign exchange forwards and swaps.

The foreign exchange forwards have been fair valued using forward exchange rates that are quoted in an
active market. Foreign exchange swaps are fair valued using forward interest rates extracted from
observable yield curves. The effects of discounting are generally insignificant for level 2 derivatives.

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Fair Value of Financial Instruments (Continued)

(b)

Assets and liabilities not measured at fair value but for which fair value is disclosed

Fair values analysed by level in the fair value hierarchy and carrying value of assets not measured at fair

value are as follows:

31 March 2019 (Unaudited)

31 December 2018

In millions of RR

Level 1

Level 2

Level 3 Carrying

value

Level 1

Level 2

Level 3 Carrying

value

FINANCIAL ASSETS CARRIED AT AMORTISED COST

Cash and cash equivalents

- Cash on hand

4,632

5,839

- Cash balances with the

CBRF (other than mandatory

reserve deposits)

7,830

11,158

- Placements with other

banks and non-bank credit

organizations with original

maturities of less than three

months

- 18,755

16,805

Mandatory cash balances

with the CBRF

2,616

2,435

Due from other banks

571

776

Loans and advances to

customers

241,125

198,489

Guarantee deposits with

payment systems

4,477

4,603

Other financial assets

Settlement of operations

with plastic cards receivable

- 10,730

12,694

Other receivables

3,667

2,948

Total financial assets

carried at amortised cost

4,632 44,169

245,602

294,403

5,839 46,816

203,092

255,747

Fair values analysed by level in the fair value hierarchy and carrying value of liabilities not measured at fair

value are as follows:

31 March 2019 (Unaudited)

31 December 2018

In millions of RR

Level 1

Level 2

Level 3 Carrying

value

Level 1

Level 2

Level 3 Carrying

value

FINANCIAL LIABILITIES CARRIED AT AMORTISED COST

Due to banks

- 24,482

2,708

Customer accounts

Individuals

-Current/demand accounts

- 134,665

- 137,637

-Term deposits

- 108,445

- 108,437

- 102,829

- 100,227

SME

-Current/demand accounts

- 37,575

41,702

Other legal entities

-Current/demand accounts

873

552

-Term deposits

212

847

798

Debt securities in issue

RR Bonds issued on

domestic market

6,036

5,989

5,919

5,851

Euro-Commercial Paper

4,348

3,754

Subordinated debt

Perpetual subordinated bonds 20,093

- 19,287 20,505

20,644

Other financial liabilities

Settlement of operations

with plastic cards

8,142

4,904

Trade payables

3,952

3,189

Credit related commitments

1,826

2,041

Other financial liabilities

473

1,067

Total financial liabilities

carried at amortised cost

26,129

323,167

350,261 26,424

299,189

325,074

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Fair Value of Financial Instruments (Continued)

Fair value is the amount at which a financial instrument could be exchanged in a current transaction

between willing parties, other than in a forced sale or liquidation, and is best evidenced by an active quoted

market price. Where quoted market prices are not available, the Group used valuation techniques. The fair

value of floating rate instruments that are not quoted in an active market was estimated to be equal to their

carrying amount. The fair value of unquoted fixed interest rate instruments was estimated based on

estimated future cash flows expected to be received discounted at current interest rates for new instruments

with similar credit risk and remaining maturity.

As at 31 March 2019 and 31 December 2018 the fair value of the debt securities in issue and subordinated

debt has been calculated based on quoted prices from OJSC Moscow Exchange MICEX-RTS and Global

Exchange Market, where the Group’s debt securities are listed and traded.

Weighted average discount rates used in determining fair value as of 31 March 2019 and 31 December

2018 depend on currency:

In % p.a.

31 March 2019

(Unaudited)

31 December

2018

Assets

Cash and cash equivalents

0.0

Due from other banks

5.8

5.9

Loans and advances to customers

38.3

42.7

Investments in debt securities

5.4

5.5

Repurchase receivables

4.7

4.3

Liabilities

Due to banks

7.5

6.0

Customer accounts

4.2

4.4

Debt securities in issue

4.7

7.6

Subordinated debt

8.2

9.8

Related Party Transactions

Parties are generally considered to be related if the parties are under common control or one party has the

ability to control the other party or can exercise significant influence over the other party in making financial

or operational decisions. In considering each possible related party relationship, attention is directed to the

substance of the relationship, not merely the legal form. The outstanding balances with related parties were

as follows:

31 March 2019 (Unaudited)

31 December 2018

In millions of RR

Key

management

personnel

Other related

parties

Key

management

personnel

Other related

parties

ASSETS

Gross amounts of loans and advances to

customers (contractual interest rate: 28.3%

(31 December 2018: 27.8%))

TOTAL ASSETS

LIABILITIES

Customer accounts (contractual interest rate:

3.3% p.a. (31 December 2018: 4.2% p.a.))

1,561

487

1,349

798

Debt securities in issue (discount: 4%)

4,348

3,754

Other non-financial liabilities

672

888

TOTAL LIABILITIES

2,233

4,835

2,237

4,552

EQUITY

Share-based payment reserve

- Management long-term incentive programme

676

1,102

TOTAL EQUITY

676

1,102

TCS Group Holding PLC
Notes to the Consolidated Condensed Interim Financial Information – 31 March 2019

Related Party Transactions (Continued)

Other related parties in the tables above are represented by entities which are under control of the Group's
ultimate controlling party Oleg Tinkov.

The income and expense items with related parties were as follows:

Unaudited

Three months ended

31 March 2019

Three months ended

31 March 2018

In millions of RR

Key

management

personnel

Other related

parties

Key

management

personnel

Other related

parties

Interest income calculated using the effective
interest rate method

Interest expense calculated using effective
interest rate method

(21)

(4)

(12)

(14)

Unrealised foreign exchange translation gains
less losses

Key management compensation is presented below:

Unaudited

In millions of RR

Three months ended

31 March 2019

Three months ended

31 March 2018

Short-term benefits:

- Salaries

201

179

- Short-term bonuses

177

249

Long-term benefits:

- Management long-term incentive programme

130

185

Total

508

613

Management long-term incentive program

. On 31 March 2016 the Group introduced a MLTIP as both a

long-term incentive and a retention tool for the management of the Group.

On 15 January 2019 the Group granted shares to new participants in MLTIP which resulted in the total number

of GDRs attributable to the Management of 9,940 thousand as at 31 March 2019 (31 December 2018: 9,849

thousand).

Participants cannot own or exercise their shareholder rights over GDRs within MLTIP directly. Participants

are entitled to the dividends, if any.

The fair value as at recognition dates of the equity-settled share-based payments (31 March 2016,

8 February 2017, 22 February 2018 and 15 January 2019) is determined on the basis of a market quote.

The delivery dates as of which the GDRs are allowed to be sold by the participants correspond to the

vesting dates at 14 April 2016 and each subsequent 31 March (with exception of 2019 when the vesting

date for all participants was 31 January 2019) until 2022 for participants joining in 2016, until 2023 for

participants joining in 2017, then until 2024 for participants joining in 2018, and until 2025 for participants

joining in 2019.

Events after the End of the Reporting Period

On 3 April 2019 the Group issued RR denominated bonds with a nominal value of RR 10,000 million at

9.25% coupon rate maturing on 21 March 2029.

On 13 May 2019 the Board of Directors declared an interim dividend in line with the current dividend policy of

USD 0.17 per share/per GDR with a total amount allocated for dividend payment of around USD 31.05 million.

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