The Big Bank's total loan portfolio grew to a record €1.75 billion by the end of the first quarter, up €86 million quarter-on-quarter (+5%) and €325 million year-on-year (+ 23%) increased. During the quarter, the corporate loan portfolio increased by €22 million (+4%) to €600 million, the mortgage portfolio increased by €43 million (+12%) to €394 million, and the consumer loan portfolio increased by €43 million (+12%) to €394 million. The loan portfolio increased by EUR 25 million (+3%) to EUR 762 million.
In the first quarter, the savings and fixed deposit portfolios grew at roughly the same rate. The Group's total deposit portfolio grew to €2.15 billion, an increase of €215 million (+11%) quarter-on-quarter and €655 million (+44%) year-on-year. The term deposit portfolio increased by EUR 100 million (+11%) to EUR 1.02 billion, exceeding EUR 1 billion for the first time. The savings portfolio for the quarter increased by 116 million euros (+11%) to 1.14 billion euros. An important milestone at the beginning of the quarter was the launch of fixed deposits in Lithuania, the last market where the big banks do not offer fixed deposit products. As of January 2024, big banks offer term deposits in all markets in which they operate.
The big bank made a net profit of 6.4 million euros in the first quarter of 2024. Compared to the first quarter of 2023, net profit decreased by 3.2 million euros.
Compared to the first quarter of 2023, the Group's net interest income increased. Net interest income for the first quarter of 2024 was €26.4 million (Q1 2023: €22.5 million), an increase of €3.9 million (+17%) compared to the same period last year. Before.
The overall economic downturn and weak consumer confidence negatively impacted big banks' consumer loan portfolios for the second consecutive quarter. Although there is still no significant deterioration compared to historical data, the quality of the portfolio has declined over the past six months. There was no sign of deterioration in the quality of the mortgage portfolio, but the quality of the corporate loan portfolio also declined slightly in the first quarter. The percentage of loans in default, allowances for credit losses on loans, and additional provisions all increased.
In the first quarter of 2024, the provision for credit losses on loans increased by EUR 2.6 million compared to the same period last year. Compared to the end of 2023, stage 3 loan receivables increased by €32.2 million and accounted for 4.7% of total loan receivables at the reporting date. Additionally, the Group updated the inputs to its loan impairment model in the first quarter of 2024. New historical data has been included in probability of default (PD) and loss given default (LGD) calculations and forward-looking models have been updated. Macroeconomic indicators using his March 2024 forecast of the central bank. As a result of the update, an additional provision for future loan impairments of €2.2 million was recognized.
The Group's income tax expense amounted to €1.3 million, an increase of €200,000 compared to the same period last year. This increase is mainly due to the introduction of prepaid income tax in Latvia at the end of 2023, which in 2023 was only reflected in the fourth quarter figures, but will affect all quarters in 2024. become.
The Group's investment property portfolio, which includes agricultural land and commercial properties, amounted to €49 million at the end of the quarter. During the quarter, the Group did not enter into any significant transactions with investment properties.
In 2024, the Group identified a calculation error regarding the application of the effective interest method. The error occurred in the periodization of revenues and expenses directly related to the 2022 loan issuance, but was corrected in the first quarter of this year. As a result of the correction of the error, retained earnings for the prior period decreased by €3.2 million. Additionally, as of December 31, 2023, receivables from customers decreased by EUR 3.7 million and corporate tax liability decreased by EUR 0.5 million.
|
Income statement (unit: thousand euros) |
Q1 2024 |
Q1 2023 |
3M 2024 |
3M 2023 |
|
net interest income |
26,392 |
22,519 |
26,392 |
22,519 |
|
Net fees and commission income |
2,164 |
1,973 |
2,164 |
1,973 |
|
Net income (loss) on financial assets |
1,071 |
572 |
1,071 |
572 |
|
Other net operating income |
-849 |
-117 |
-849 |
-117 |
|
Total net operating income |
28,778 |
24,947 |
28,778 |
24,947 |
|
Salaries and related fees |
-6,412 |
-5,652 |
-6,412 |
-5,652 |
|
Management fee |
-3,669 |
-3,523 |
-3,669 |
-3,523 |
|
Depreciation, amortization and impairment |
-2,052 |
-1,013 |
-2,052 |
-1,013 |
|
total expenses, total expenses, total expenses |
-12,133 |
-10,188 |
-12,133 |
-10,188 |
|
Reserve (income) |
-2,419 |
Five |
-2,419 |
Five |
|
Profit before loss allowance |
14,226 |
14,764 |
14,226 |
14,764 |
|
Reserve for net losses on loans and financial investments |
-6,555 |
-3,909 |
-6,555 |
-3,909 |
|
Pre-tax profit |
7,671 |
10,855 |
7,671 |
10,855 |
|
income tax expense |
-1,275 |
-1,113 |
-1,275 |
-1,113 |
|
Net income from continuing operations |
6,396 |
9,742 |
6,396 |
9,742 |
|
Gain (loss) from discontinued operations |
twenty one |
-121 |
twenty one |
-121 |
|
Net income |
6,417 |
9,621 |
6,417 |
9,621 |
|
Statement of financial position (unit: thousand euros) |
March 31, 2024 |
December 31, 2023 (Repost) |
March 31, 2023 |
|
cash and cash equivalents |
652,065 |
518,672 |
258,316 |
|
FVOCI Debt Securities |
13,586 |
15,400 |
18,531 |
|
financing to customers |
1,747,606 |
1,662,002 |
1,422,702 |
|
Other assets |
89,823 |
91,324 |
104,985 |
|
Total assets |
2,503,080 |
2,287,398 |
1,804,534 |
|
Amounts of customer deposits and loans received |
2,161,463 |
1,946,314 |
1,507,115 |
|
subordinated debt |
76,476 |
76,109 |
62,908 |
|
Other debts |
21,688 |
20,182 |
17,310 |
|
Total debt |
2,259,627 |
2,042,605 |
1,587,333 |
|
capital |
243,453 |
244,793 |
217,201 |
|
Total debt and equity |
2,503,080 |
2,287,398 |
1,804,534 |
Comment from Martin Länts, Chairman of the Management Board of Bigbank AS:
The loan portfolio continues to show strong growth across all product categories. Particularly pleasing was the growth in the mortgage portfolio, which increased by €43 million in the first quarter of this year, exceeding growth in the same period last year by €23 million. The real estate market is showing signs of revitalization, and it's good to see more customers choosing big banks as their home purchase finance provider.
Business loans and leases sales also grew significantly in the first quarter, reaching €114.4 million, up 93% year-on-year. Particularly rapid growth was seen in Lithuania's corporate loan and lease sales, which grew three times compared to last year.
Our funding base remains strong, with our deposit portfolio growing faster than our loan portfolio in the first quarter, increasing by €215 million and exceeding growth in the first quarter of last year by €85 million. Ta. Regarding deposits, it is important to note that we recently started offering deposits on the Lithuanian market. We are proud to announce that Lithuanian customers can also join Big Bank's overall strategy of offering one of the highest market rates in the entire domestic market.
Big banks' profits for the first quarter of 2024 decreased compared to the same period last year. The largest impact was due to higher loan loss provisions, personnel costs, deposit guarantee fund expenses, and higher amortization of intangible assets.
Regarding the outlook, we will continue to systematically implement and work on our Group strategy, which includes continued growth and expansion of our product portfolio for everyday banking.
Big Bank AS (www.bigbank.eu) is an Estonian capital-based bank specializing in loans and deposits for private and corporate customers. In addition to its operations in Estonia, the bank also has branches in Finland, Sweden, Latvia, Lithuania and Bulgaria, and offers cross-border products in Austria, Germany and the Netherlands. The Big Bank's total assets exceed 2 billion euros.
argo kiltsman
Management committee members
Phone: +372 5393 0833
Email: argo.kiltsmann@bigbank.ee
www.bigbank.ee
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