Bank CenterCredit reported Q2 2025 results. Quarterly interest income hit a new record, while net profit showed strong YoY growth. We also note the full repayment of state support, which opens the door for future dividend payments. In our valuation model, we updated key financial indicators, reduced the number of shares after the buyback, and raised the cost of equity. We also expect higher net profit going forward. As a result, our target price per BCC share is 4,100 KZT, implying -10% overvaluation from the current level. Recommendation — Hold.
(+) Record-high interest income. In Q2, interest income reached a new record of 226 billion KZT, up 29% YoY and 5.3% QoQ. The main driver was income from loans, which rose 5.8% QoQ and 30% YoY. Other lines also showed positive dynamics, except for income from deposits with other banks. At the same time, interest expenses grew at a faster pace (+39% YoY and +12% QoQ). The net loan portfolio expanded 3.5% QoQ and 20% YoY.
(+) Strong YoY growth in net profit. Quarterly net fee and commission income grew 21% QoQ and 16% YoY, reaching a record 12.1 billion KZT. Net non-interest income stood at 33.5 billion KZT (-28% QoQ, +147% YoY), mainly supported by FX trading gains (+87% YoY). The quarterly decline came from volatility in financial asset gains and provisioning on other operations. Operating expenses increased 15% YoY and 11% QoQ. As a result, BCC posted quarterly net profit of 64.6 billion KZT (+57% YoY, -21% QoQ), or 367 KZT per share (+66% YoY). Cash collection of interest income fell from 97% to 94%, while the ratio of liquid assets to liabilities edged up from 43% to 44% over the quarter
Our opinion and valuation model changes. We assess BCC’s report as moderately positive, driven by growth in both interest income and net profit. Importantly, the full repayment of state support paves the way for potential dividends, though much will depend on the bank’s still relatively thin capital base. In our valuation model, we updated financial indicators, raised the cost of equity, and reduced the share count after the buyback. As a result, the new target price per BCC share is 4,100 KZT, implying -10% overvaluation. Recommendation — Hold.