OREANDA-NEWS. October 31, 2012. “One of our key tasks during this period was welcoming and incorporating our new customers from Latvijas Hipoteku un Zemes Banka. In order to be closer to our customers, we increased our presence in the regions, whilst retaining cost-efficiency. Demographic trends in Latvia suggest that the availability of services in the regions is one of the key challenges both for businesses and the state. We believe that the solution lies in the use of modern technologies and the internet, which is what the greater part of our existing customer base is already successfully doing. As for our new clients, we will help them embrace these opportunities through training and through providing an enhanced infrastructure,” says Maris Mancinskis, Head of Swedbank Latvia, reported the press-centre of Swedbank.

Swedbank Latvia’s Q3 2012 net profit, including its insurance business, was LVL 14m. The profit for Q1-Q3 2012 was LVL 62m, compared to LVL 81m for the same period in 2011. The decline is mainly due to lower loan interest income and net recoveries.

Loans and deposits
The volume of customer deposits increased by 12% for Q1-Q3 2012. Retail deposits increased by 9%, while corporate deposits increased by 17%. Corporate deposits were mainly driven by exports, while retail deposits were fuelled by new job creation and salary increases. At the end of Q3 2012, the volume of deposits stood at LVL 1670m.

Swedbank Latvia issued LVL 147m in new loans in Q3, LVL 127m of which was made available to corporate customers and LVL 20m to private customers. In Q1-Q3, Swedbank issued LVL 297m in new loans. The total net credit portfolio in Q3 contracted by a further 2% compared to Q4 2011. At the end of Q3 2012, the credit portfolio stood at LVL 2496m.

Hipo Lizings’ entire team of experts as well as a LVL 46m portfolio joined Swedbank in Q3. The remaining portfolios of the acquired commercial arms will be incorporated in Q4.

The loan-to-deposit ratio continued to improve, and decreased to 141% (171% per cent in Q4 2011).

Credit quality
Impaired loans, gross, continued to decline, falling to LVL 428m at the end of Q3, compared to LVL 605m in Q4 2011. New lending rose and consequently improved the overall quality of the portfolio.

Risk-weighted assets decreased from LVL 2 782m at the start of the year to LVL 2 634m at the end of Q3.

Revenue and costs
In Q1-3, revenues and costs decreased by 3%, and 2% respectively compared to the same period in 2011. The number of customers and their day-to-day banking grew hand in hand. However, given the prevailing low interest rates, revenues declined. The cost/income ratio remained unchanged during this period at 42%.

Customer service news
Over 29 thousand new customers joined Swedbank in Q3 - mainly from Latvijas Hipoteku un Zemes Banka following the acquisition of its commercial arm.

Since embarking on the acquisition of the commercial arm of Latvijas Hipoteku un Zemes Banka, Swedbank has opened 10 additional customer service locations in different regions of Latvia in a bid to be closer to its customers. Today, in Q3 2012 Swedbank is available in 112 places in Latvia, 55 of which are branches offering extra services. This consolidates Swedbank’s position as the biggest banking network in Latvia.

In celebration of its 20th anniversary in Latvia, Swedbank prepared a special gift for its customers - a special summer concert by Prata Vetra with songs chosen in a vote by Swedbank customers.

In Q3, Swedbank Latvia ranked 1st in financial industry brands and 3rd overall in the Most Loved Brands Top survey.

To view Swedbank Latvia’s Q3 2012 results, please visit - www.swedbank.lv.