Bigbank's November 2024 Growth and Financial Performance Insights

Bigbank's Robust Performance in November 2024

In November, Bigbank experienced significant growth, continuing its trend of stability and profitability. The home loans portfolio showcased remarkable expansion, increasing by over 25 million euros in just one month. Similarly, the business loans portfolio reflected solid results, growing by more than 16 million euros, while the consumer loans portfolio saw a rise of nearly 2 million euros. Altogether, the loan portfolio surged by nearly 44 million euros compared to the end of October, marking an average performance consistent with 2024.

Interest Rate Trends and Their Impact

The decline in interest rates played a significant role in how Bigbank approached deposit collection. The six-month Euribor started the month at 2.9% but dipped below 2.7% by month’s end. This downward trend is indicative of broader changes occurring over the last quarter. For loan customers with floating interest rates, the falling Euribor translates to lower payments; however, it also leads to a decrease in interest income for banks like Bigbank. Interestingly, while deposit interest rates also dropped, they did not fall as sharply as the Euribor. Consequently, the growth in the deposit portfolio moderated, increasing by 15 million euros in November.

Credit Quality Maintenance

Through November, Bigbank maintained a steady credit quality in its loan portfolio. The previously observed short-term deterioration in loan quality has resolved, leading to a low proportion of non-performing loans in the overall portfolio. Furthermore, the costs associated with loan and financial investment impairments and provisions reached 1.9 million euros, which is below the monthly average for 2024.

Financial Highlights for November

The bank reported a net profit of 3.3 million euros for November, a solid result reflecting its operational success. However, this figure represents a decrease of 2.0 million euros when compared to the cumulative results for the first 11 months of the previous year. Key factors contributing to this decline include increased net loan and investment impairments along with higher salary and income tax expenses due to new obligations affecting Latvian credit institutions.

Performance Metrics and Yearly Trends

Analyzing Bigbank's financial performance paints a clearer picture of its operational health:

• Deposits from customers and loans received grew by 446 million euros year-on-year, now totaling 2.4 billion euros (+23%).
• Loans extended to customers increased by 503 million euros year-on-year, amounting to 2.1 billion euros (+31%).
• Net interest income stood at 8.9 million euros in November, totaling 97.2 million euros for the first 11 months, marking a growth of 6.0 million euros (+7%) from the same timeframe last year.
• Cumulative net loss allowances for loans and financial investments reached 23.2 million euros over the first 11 months, reflecting an increase of 4.3 million euros or 23% from the previous year.
• The cumulative profit for the first 11 months was 33.4 million euros, which is a decrease of 2.0 million euros or 6% compared to last year.
• Return on equity (ROE) was reported at 14.6% in November.

Business Volume Metrics Explained

Examining the business volumes reveals further insights:

• Customer deposits and loans received stood at approximately 2.37 billion euros, reflecting a year-on-year growth of 23%.
• Loans to customers have also shown an impressive increase, totaling 2.15 billion euros, which indicates a growth of 31% compared to the previous year.

Key Financial Ratios and Performance Indicators

Further details concerning Bigbank's performance can be evaluated through key metrics:

• As of November 2024, the Return on Equity (ROE) is 14.6%, slightly down from 17.0% in the same month last year.
• The cost-to-income ratio improved slightly to 39.5%, showing efficiencies in cost management.
• Customer satisfaction, measured by the Net Promoter Score (NPS), was recorded at 55 in November.

Bigbank AS, a commercial bank established over three decades ago, is owned by Estonian capital and operates across nine countries, servicing more than 150,000 active clients with a dedicated workforce of 500 professionals. The bank is grounded in solid financial principles, as evidenced by a Ba1 long-term deposit rating assigned by Moody's, along with a baseline credit assessment of Ba2.

Frequently Asked Questions

What were the major growth areas for Bigbank in November 2024?

The major growth areas included home loans, business loans, and consumer loans, with notable increases in each portfolio.

How has the declining Euribor affected Bigbank's operations?

The decreasing Euribor rates have led to lower interest income for Bigbank, yet they also provide relief for customers with floating interest rates.

What is Bigbank's profit for November 2024?

The net profit for Bigbank in November 2024 was 3.3 million euros, marking a decline from the prior year's profit.

What are the key financial ratios related to Bigbank's performance?

Key financial ratios include a Return on Equity of 14.6% and a cost-to-income ratio of 39.5% for November 2024.

Where can I find more information about Bigbank?

For further insights, you can visit the official Bigbank website at www.bigbank.eu.

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