Swedbank financial results of H1 2012
- Swedbank Lithuania earned a net profit of LTL 78m in Q2
- Profits due to increased client activity and increased efficiency
- Continued stability in lending volumes
Swedbank Lithuania reported a profit of LTL 174m H1 2012 (LTL 299m H1 2011). This decline was due to lower net recoveries.
“The bank’s results of the first half of the year reflect stable growth in the country’s economy. The improving economic environment had a positive impact on increasing household consumption as well as clients’ activity in general, – said Marius Adomavičius, Acting Head and Chief Financial Officer at Swedbank Lithuania. – We presume that this trend should continue, however, the growth depends on the challenges in the Euro zone, the economy’s growth can slow down”.
Economic growth remained strong in Lithuania and year on year GDP growth reached 3.9 per cent in Q2. Growth was mainly fuelled by investments, exports and household consumption. Whilst the export-driven sectors in the Lithuanian economy are sensitive to developments in the Euro zone, external challenges remain a potential risk.
Loans and deposits
Lending volumes at the end of Q2 2012 fell by 1 per cent YTD. The loan portfolio amounted to LTL 13 742m. Compared with Q1 2012 the lending portfolio remained constant. Total deposit volumes increased by 5 per cent YTD. The deposit portfolio amounted to LTL 13 730m. In H1 2012 private and corporate deposits rose by 4 per cent and 9 per cent respectively. The loan-to-deposit ratio decreased to 100 per cent (107 per cent Q4 2011), suggesting that the bank is less dependant on international markets.
Net recoveries amounted to LTL 5m (LTL 136m H1 2011). Impaired loans, gross, declined in H1 2012 and amounted to LTL 1.6bn (LTL 1.9bn Q4 2011). New lending is gradually increasing and improving overall portfolio quality.
Revenues and costs
Total income was LTL 329m in H1 2012 and compared to the same period last year income decreased by LTL 9m.
Net interest income fell by 15 per cent compared to H1 2011 and amounted to LTL 178m.
Net commission income increased by 11 per cent year on year and amounted to LTL 107m in total at the end of Q2 2012. The increase was mainly driven by an increase in daily banking activity and an improved economic environment. The number of active customers increased by 3 658 in H1 2012 to 1 381 731.
Expenses were 1 per cent (LTL 2m) lower than in the same period last year and reached LTL 154m. The cost/income ratio remained almost unchanged at 46.7 per cent.
To view Swedbank Lithuania’s Q2 2012 operating results, please visit: www.swedbank.lt
To view Swedbank Group’s Q2 2012 results, please visit: www.swedbank.com
Swedbank Q3 2012 results will be published on 23 October 2012