In February, against the background of an uncertain economic environment, the growth of LHV’s loan portfolio and volume of deposits slowed down, but the quality of the credit portfolio remained at a good level.
The consolidated deposits of AS LHV Group decreased by EUR 42 million over the month, mainly due to a decline in deposits from payment intermediaries. The consolidated loan portfolio decreased by EUR 57 million over the month. Although retail loans increased by EUR 4 million, corporate loans were at a decrease. The volume of funds managed by LHV remained almost the same in February, only decreasing by EUR 1 million. In February, 2.8 million payments related to financial intermediary clients were processed.
In February, AS LHV Group earned EUR 8.9 million in consolidated net profit. AS LHV Pank earned EUR 11.0 million in net profit, of which EUR 2.5 million was from servicing clients related to the United Kingdom branch. The net profit of AS LHV Varahaldus was EUR 65,000. AS LHV Kindlustus generated a net loss of EUR 97,000 in February, and LHV UK Limited generated a net loss of EUR 1.8 million.
For LHV Pank, February was characterised by increased competition in terms of deposits, and a deceleration in the growth of the loan portfolio. Clients are moving from demand deposits to fixed-term deposits, facilitated by the increase of the interest rate to up to 2.5% per year. By the end of February, the volume of fixed-term deposits increased by EUR 69 million. Although model-based discounts of the bank’s loan portfolio were reduced, reserves were created in a similar extent, which were reflected as expenses in the financial results of the month.
In its survey of the field, survey company Dive designated LHV Pank as the bank with the best service quality in Estonia. In addition, CV-online’s Top Employer survey showed that people see LHV as the most desirable employer in Estonia. The number of bank clients increased by 4,100 in February.
A significantly more modest month on the markets had an effect on the results of LHV Varahaldus. Pension funds were slightly in the red in February, with the decline of the larger funds M, L and XL being 0.5%, 0.6% and 0.8%, respectively. Pensionifond Indeks decreased by 1.4%, Pensionifond Roheline lost 2.5% in value. At the same time, the number of pension clients increased by over 600 in February.
LHV Kindlustus continued to increase the volume of contracts in all main types of insurance. A total of 11,700 insurance contracts were concluded in February, with a volume of EUR 2.4 million. Loss events were compensated for in the amount of EUR 0.8 million. The increase in average insurance premiums is supporting the improvement of efficiency indicators.
In the United Kingdom, LHV UK Limited continued with active sales of corporate loans via brokers and direct contacts. Correspondence with supervisory bodies to obtain a banking licence and the coordination of documents also continued.
In February, LHV published the company’s new financial plan and the five-year financial forecast. The financial plan currently stands. Also, LHV Group has called the annual general meeting of the shareholders, which will be held on 22 March at 13.00 in Tallinn, in the Hilton Tallinn Park Hotel.
AS LHV Group’s reports are available at: https://investor.lhv.ee/en/reports/.
LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are LHV Pank, LHV Varahaldus, and LHV Kindlustus. The Group’s companies employ more than 910 people. As at February, LHV’s banking services are being used by 387,000 clients, the pension funds managed by LHV have 130,000 active clients, and LHV Kindlustus protects a total of 155,000 clients. LHV’s UK branch offers banking infrastructure to 200 international financial services companies, via which LHV’s payment services reach clients around the world.
Priit Rum
Communication Manager
Phone: +372 502 0786
E-mail: priit.rum@lhv.ee
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- LHV Group 2023-02-EN
