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Home Credit BV 2018 net income up 80%; assets excluding United States

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PRAGUE (Reuters) – Consumer lender Home Credit’s net income for activities excluding its United States business and some other assets grew by 80% last year to 571 million euros (512 million pounds), the Czech group said on Friday.

The results cover the Home Credit BV (HCBV) unit of its parent Home Credit Group, which separately reported full-year net profit of 394 million euros, up from 232 million a year ago.

HCBV said that in the first quarter of 2019, net profit reached 155 million euros for the activities in nine markets outside the United States – China, India, Vietnam, Indonesia, Philippines, Russia, Kazakhstan, the Czech Republic and Slovakia.

It said last year it had a “slight loss” in the same period.

Loans grew 12.8% last year to 17.43 billion euros, it said. Net interest margins rose by 1.2 percentage point to 15.8% and cost-to-income ratio dropped by 8 percentage points to 42.2%.

HCBV was able to sustain profit growth well ahead of the cost of expanding its operations in SSEA, China, CIS and CEE, through a combination of an increased cash loan portfolio and a higher average yield on assets,” the Amsterdam-registered company said in a statement.

Home Credit did not comment in the release on the reason for transferring the U.S. and some other small operations to the parent group, a transaction done this year.

Las month, sources with direct knowledge of the matter said Home Credit had appointed Citigroup HSBC Holdings and Morgan Stanley to lead a Hong Kong initial public offering (IPO) of at least $1 billion, expected in September or October.

In May, Czech investment group PPF increased its holding in the parent Home Credit Group after buying a 2.5% stake from co-shareholder Emma Capital in a deal valuing the company at 8.5 billion euros.

PPF, owned by the Czech Republic’s richest businessman, Petr Kellner, raised its stake to 91.1%, with fellow Czech investment group Emma Capital holding the remaining 8.9%.

(Reporting by Jan Lopatka, editing by Louise Heavens)

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