OREANDA-NEWS. February 17, 2012. “Last year, we developed our customer service model and strengthened several business indicators. This was reflected by our customers, which is evident in the strong growth in deposits, an increase in new lending and improved quality in our credit portfolio. Our aim is to provide great service and solutions for our customers' needs. The number of customers who chose Swedbank as their main bank increased noticeably, clients also appreciated regular finance consultations. These indicators show that our chosen model of long-term relationship is the right direction to further development," says Maris Mancinskis, the Head of Swedbank Latvia, reported the press-centre of Swedbank.

Swedbank Latvia, including insurance business, reported a profit of LVL 80.4m for 2011, compared to a LVL 45.0m loss in 2010. The improved result is mainly due to net recoveries. Profit before credit impairments was LVL 70.9m in 2011.

Loans and deposits
The volume of customer deposits was LVL 1 487m at the end of Q4 2011 and increased by 1 per cent year-on-year.

Swedbank issued LVL 276m in new loans in 2011, LVL 229m of which was made available to businesses. The total net credit portfolio shrank by 12% last year compared to the end of Q4 2010. This was mainly due to portfolio amortisation and diminishing new loan demand. Swedbank net credit portfolio was LVL 2 546m at the end of Q4 2011.

The loan-to-deposit ratio continued to improve, falling to 171 per cent (196 per cent at the end of Q4 2010). The volume of client deposits increased in 2011 in spite of false rumours spread through social media in Latvia about Swedish banks

Credit quality
Net recoveries for 2011 amounted to LVL 25.9m (compared to LVL 123.4m in credit impairments for the previous year), mainly in corporate credit portfolio. Impaired loans, gross, continued to decline throughout the year and amounted to LVL 605m, down from LVL 890m at the end of Q4 2010. We expect this trend to continue.

Revenues and costs
Revenues decreased by 2.0 per cent in 2011. Expenses decreased by 1.5 per cent. The cost-income ratio in 2011 was  0.46.

Customer focus
The number of customers using Swedbank as their main bank increased by more than 45 thousand in 2011. In 2012, Swedbank?s focus will be on further strengthening a customer-centric business model based on long-term relationships with customers, whilst always keeping an eye on efficiency.

Our work on customer relations also earned external recognition. In 2011, the international finance magazine Global Finance named Swedbank the best bank in Latvia and Estonia, and Swedbank's personal Internet banking service as the best in the Baltics. Swedbank ranked 7th in the “Most Loved Brands Top” study conducted by the business magazine Kapitals and the agency TNS Latvia and was the only financial institution in the Top 10. In Diena's and Porter Novelli's “Company Reputation Top 2011”, Swedbank ranked 1st among financial sector companies and moved from 9th to 5th position in the overall ranking of Latvia’s companies.