LHV Group Sees Significant Growth Across Financial Metrics

LHV Group Reports Strong Financial Trends

This August witnessed a remarkable stride for LHV Group in various key financial metrics. The company’s lending efforts accelerated beyond expectations, positively influencing profit margins. Specifically, the consolidated loan portfolio experienced a jump of EUR 87 million throughout the month, while deposits rose significantly by EUR 254 million across the board. LHV also managed to control an additional EUR 4 million in funds this August, with financial intermediaries processing payments amounting to EUR 6.1 million monthly.

Consistent Profit Growth

The consolidated net profit for LHV Group came in at a notable EUR 12.2 million. Among its subsidiaries, AS LHV Pank showcased an impressive profit of EUR 11.8 million. Other contributions included LHV Bank Ltd with EUR 13 thousand, AS LHV Varahaldus netting EUR 240 thousand, and AS LHV Kindlustus bringing in EUR 129 thousand. This diverse income highlights the collaborative strength of LHV's subsidiaries.

Client Growth and Loan Activity

The growth in clientele has been particularly striking, with LHV Pank adding an impressive 3,600 new clients. This surge was largely driven by heightened client engagement and performance in the home loan sector. Specifically, of the total EUR 50 million increase in the loan portfolio, retail loans contributed EUR 36 million, while corporate loans accounted for EUR 14 million. Additionally, retail client deposits surged by EUR 40 million, financial intermediary deposits saw an increase of EUR 93 million, and through various platforms, EUR 35 million was raised in new deposits. It’s encouraging to note that write-downs have remained lower than anticipated, underlining the robustness of the credit quality.

Strategic Acquisition Plans

A major highlight for August was LHV Pank's agreement to partially acquire a loan portfolio from TBB Pank, valued at approximately EUR 36 million. This strategic move is projected to be finalized by the close of the third quarter. In an exciting development, LHV Pank reopened its doors for student loan applications, reflecting its commitment to expanding lending options.

International Ventures and Banking Growth

Within LHV Bank, which operates in the United Kingdom, August marked the fastest growth in the loan portfolio and deposits recorded to date. The growth figures showed a EUR 37 million increase in the loan portfolio and a EUR 85 million rise in deposits. Despite these increases, business volumes still trail behind the financial plan, with interest income not meeting the forecasted amounts. Ongoing development of LHV Bank's retail banking offerings is under way, driving costs higher. A notable advancement includes the testing of the mobile app set to launch for staff in October.

Stable Fund Management and Insurance Growth

As for LHV Varahaldus, the management of funds remained steady despite market fluctuations, increasing by EUR 4 million. While net profits aligned with expectations, the fund volume did fall short of the target. Acceptance of applications for enhanced second pillar payments remains strong, with 7,300 clients submitting their applications by the end of August.

Insurance Divisions Ahead of Schedule

LHV Kindlustus has been operating at a consistent and slightly accelerated pace. August saw the creation of 15,600 new insurance contracts, amounting to EUR 2.2 million, pushing the total number of policies to 244,000. Compensation for loss events totaled EUR 1.8 million, maintaining stability in loss event occurrences.

Financial Performance Exceeds Expectations

By the conclusion of August, LHV Group's net profit surpassed expectations by an impressive EUR 20.2 million, confirming the robustness of its financial strategies. Despite this success, the overarching financial plan remains unchanged, indicating stability within the group's operational framework.

About LHV Group

LHV Group stands as Estonia's primary domestic financial powerhouse, offering vital capital through its subsidiaries including LHV Pank, LHV Varahaldus, LHV Kindlustus, and LHV Bank Limited. Presently, the Group employs over 1,100 individuals and serves 441,000 banking clients. With 118,000 active clients in pension funds and 168,000 clients protected by LHV Kindlustus, the group continues to fortify its market presence. LHV Bank Limited, holding a banking license in the UK, provides essential services to international fintech companies as well as loans to SMEs.

Frequently Asked Questions

What was the net profit of LHV Group in August?

LHV Group reported a consolidated net profit of EUR 12.2 million for the month of August.

How did LHV Pank perform in terms of client growth?

LHV Pank saw an increase of 3,600 clients in August, indicating strong engagement and lending performance.

What significant acquisition did LHV Pank announce?

LHV Pank announced the partial acquisition of a loan portfolio from TBB Pank valued at approximately EUR 36 million.

What were the outcomes for LHV Kindlustus in August?

LHV Kindlustus concluded 15,600 new insurance contracts, increasing its total policies to 244,000 with stable compensation for loss events.

How does LHV Group's performance compare to its financial plan?

By the end of August, LHV Group outperformed its net profit expectations by EUR 20.2 million while maintaining its unchanged financial plan.

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