Over the nine months, the amount of deposits placed with the bank has gone up by 9%, whereas the newly issued financing has increased by 23%

28.10.2020 - 16:45

In the first 9 months of 2020, the new financing issued by SEB banka amounted to EUR 558 million, up by 23% compared with the first nine months of the last year. The increase was mainly driven by the activity of large companies as the largest share of financing, i.e., EUR 330 million was issued to them. In the retail segment, a healthy growing interest in mortgage loans.

At the end of the nine months of 2020, the total loan portfolio of SEB Group in Latvia had increased by 1% on year-on-year basis, reaching EUR 3,108 billion, whereas total deposits had increased by 9% to EUR 3,213 billion. In the first nine months of 2020, operating profit after tax and provisions for expected credit losses reached EUR 31.4 million, down by 18% compared with a year ago. The profit decrease is related to investments in remote solutions as well as to additional provisions for expected credit losses.

Commenting on the performance of the nine months of 2020, the Chairman of the Board of SEB Banka Ieva Tetere admits that the financial performance of SEB Latvia mirrors the current economic circumstances and the public sentiment.

“The financial performance for the third quarter depicts the trends also observed in the economy. Recovering from the current economic downturn, in a number of sectors, businesses have managed to rebound to their positions. Despite this, however, businesses generally take a cautious stance, accumulate savings, and consumption remains limited. Businesses are somewhat withholding their working capital and in no hurry to make large-scale new investments.”

Customers getting more confident about the stability of the financial circumstances

“We appreciate that our customers trust us, who, encountering financial difficulties caused by the Covid-19 pandemic, started a dialogue with the bank. Since the beginning of the moratorium, SEB banka has provided support to over 1,800 borrowers. We now see that customers have regained confidence in the long-term stability of their financial position relatively quickly, as in the second half of May there was an increase in activity in housing lending, which came back to life especially fast in the third quarter in terms of housing financing and lease transactions.

The economic recovery mirrors well in the total loan portfolio, which has grown by 1% in the nine months of 2020, with the largest positive contribution coming from a 4% increase in the total corporate loan portfolio and a 4% increase in the total retail mortgage loan portfolio.

During this period, we continued to develop solutions aimed at making banking services easily accessible to customers remotely in digital format. Most recently, we introduced a solution that allows one to become a customer of SEB banka remotely, without visiting the branch, after a video consultation with a bank employee. All applications and necessary documents can be signed with a Smart-ID qualified electronic signature (QES).”

Business support initiatives and sustainability matters are high on SEB’s agenda

At the same time, we carried on our initiatives aimed at providing support to companies. For the fourth time we have announced a grant programme “(ie)dvesma” (Inspiration) for new companies. This year, the grants totalled EUR 70,000, and we have been developing it together with the city of Jurmala, Ķekavas, Mārupe, Olaine, Sigulda and Stopiņi counties. We are also pleased with the great response to the “Growth Programme”. This year, over 50 applications have been received, from which 14 Latvian companies have been selected to cooperate with experts in order to develop innovative products or services to promote a faster growth of their company. This year, the programme will be run remotely and will end in January.

During the quarter, we also continued our dialogue with the public and customers, focusing on how to identify and avoid falling into the trap of fraudsters. Thinking about SEB’s increasingly active involvement in advancing sustainability matters, we have started offering a new type of financing, i.e., “Green Credit” to our customers in all Baltic countries. Initially, it will be available to large companies that opt to invest responsibly and implement environmentally friendly and sustainable business solutions. Whereas in cooperation with industry experts, we have launched a series of public webinars on sustainability matters aimed at stimulate reflections on how our daily habits will shape the future community.”

SEB Group’s financial performance indicators in Latvia in the first nine months of 2020:

SEB Group’s revenue in Latvia amounted to EUR 81.8 million, remaining at the same level as in the nine months of 2019;
Costs amounted to EUR 37.7 million, up by 1% from a year ago, due to investments in digital solutions and the uniform customer service system in the Baltics;
Profit before provisions amounted to EUR 44 million, down by 1% compared with the period from January to September 2019;
From 1 January to 30 September, provisions for expected credit losses of EUR 11.8 million were created;
Operating profit after taxes and provisions amounted to EUR 31.4 million in the nine months of 2020, down by 18% compared with a year ago,
At 30 September 2020, the deposits with SEB banka totalled EUR 3.213 billion, up by 9% of the amount of deposits at the end of September 2019;
The loan portfolio totalled EUR 3.108 billion at the end of September 2020, up by 1% compared with the end of September 2019;
At 30 September 2020, capital and reserves amounted to EUR 423 million, up by 11% compared with the end of September 2019;
Assets amounted to EUR 4.150 billion at the end of the nine months of 2020.

Recognitions:

In a survey organised by the executive search company Amrop, which included over 5,000 respondents from 200 largest companies in the Baltics, SEB was named “The Best Employer in the Baltics.”