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NEWS - 2019 07 12 - 11:20

SEB: In the first half of 2019, customer deposits increased by 20%, whereas newly granted housing loans issued to private individuals increased by 21%

Owing to the stability of domestic consumption, the positive sentiment among the population and growing real income of households, in the first half of the year, SEB banka experienced a significant increase in the volume of private deposits and housing loans.

In the six months of the current year, SEB banka issued loans totalling EUR 279 million, of which EUR 77 million were issued to private individuals for home purchases and repairs. Furthermore, at the end of the first half of the year, the deposits of private individuals with SEB banka had increased by 12% to EUR 2.9 billion, up by 20% from a year ago.

For the first half of the current year, SEB Group's performance in Latvia was a profit of EUR 23.4 million.

Ieva Tetere, Chairwoman of the Board of Directors of SEB banka:
“The first six months of the year have been rich in opportunities and challenges. Speaking of opportunities, although economic growth is slowing down, owing to the stability of domestic consumption, economic prospects have remained favourable in the first six months of the year. The positive sentiment among the population and increase in the real incomes of households have contributed to the activity of private individuals, which has resulted in the growth of the new financing issued to private individuals for housing loans by 21%. At the end of June 2019, the total loan portfolio amounted to EUR 3 billion, up by 9% compared with the end of the first six months of 2018. It is satisfying to see that customers trust our bank, which is evidenced by the total amount of deposits placed with SEB banka, which amounted to EUR 2.9 billion at the end of June – up by 20% from a year ago (at the end of June 2018).

There was no shortage of challenges, either. At the national level, Latvia was subject to an assessment by international experts, bringing to the front the need for a more transparent public administration, need for improvements in tax and economic environment, and the joint combatting of money laundering. As for supervision of banks, these topics were also a priority in our daily routines, including through taking part in a panel discussion held by the European Commission on the role of banks in providing sustainable financing, as well as in meetings with investors, public authorities, journalists and non-governmental organizations. We have been actively engaged in building a better social and economic environment around us. For example, in April SEB banka and SEB Global Services joined the Charter of Diversity. Together with the University of Latvia (LU), Riga Technical University (RTU) and Buffalo University (USA) we launched the development of a new information technology (IT) Excellence Study Programme. At SEB Innovation Centre, we debated corporate governance issues and the impact thereof on the company’s borrowing ability.

I would like to think that the above efforts mentioned have been only some of the factors that contributed to the highest ranking in the Latvian Sustainability Index, i.e., SEB banka was ranked in the Platinum category for the third consecutive year, as we continued our long-term and continuous effort aimed at improving the business environment of the banking sector, working at creating a sustainable range of products for customers and strengthening cooperation with young people and entrepreneurs. Here we should mention the ZZ championship held in May, where we addressed more than 15 thousand of young people offering a financial literacy virtual reality game, encouraging them to treat money seriously. At the beginning of June, we completed the third cycle of the Growth Programme, where 15 companies presented their business ideas, ranging from digital solutions for purchasing optical spectacles remotely to wholesale to construction. We are pleased that we are able to support business ideas and that we are a part of the development.

Continuing on challenges, the biggest challenge facing the bank in the first six months of the year was the replacement of code cards. We thank our customers for their responsiveness. To date, 100 thousand customers have managed to migrate to secure authorisation tools. At present only 15,000 customers keep using code cards as an authorisation tool.

The cases of phishing aimed at getting money from people fraudulently, which was recently observed throughout the Baltics, are also worth of mentioning. Considering that the imagination of fraudsters has no boundaries and the topic of data security is likely to remain relevant in the future, we used thisopportunity to explain the importance of data security to our customers, focusing on the due care with which they should use their authorisation and identification means.

Johan Torgeby, President and CEO of SEB Group:
„The operating result for the second quarter 2019 amounted to SEK 6.1bn and return on equity, excluding items affecting comparability, was 13.9 per cent. SEB’s diversified business model remained favourable. Both corporate and private customers were active and lending volumes increased. The operating profit of SEK 6.1bn increased by 4 per cent compared with the first quarter this year. We have the financial strength needed to support our customers going forward.”

The financial performance indicators of SEB Group in Latvia in the first six months of 2019:

  • The revenue of SEB Group in Latvia amounted to EUR 54.6 million, up by 9% compared to the first six months of 2018;
  • The costs amounted to EUR 24.3 million, up by 2% from the respective period in 2018;
  • Profit before provisions amounted to EUR 30.3 million, up by 16% compared to the period from January to June 2018;
  • The provisions created between 1 January to 30 June amounted to EUR 6.5 million;
  • In the first 6 months of 2019, operating profit after taxes and provisions amounted to EUR 23.4 million, down by 14% from the respective period of 2018;
  • At 30 June 2019, total deposits with SEB banka amounted to EUR 2.9 billion, up by 20% higher compared with the end of June of 2018;
  • At the end of June 2018, the loan portfolio totalled EUR 3 billion, i.e., up by 9% compared with the end of the first six months of 2018;
  • Own funds and reserves amounted to EUR 364.5 million at 30 June 2018;
  • At the end of June 2019, assets amounted to EUR 3.8 billion, up by 15% more than at the end of June 2018.

In the first six months of 2019, the bank received the following acknowledgments and awards:

  • the highest rating (96.4%) to date in the Platinum category of the Sustainability Index;
  • SEB banka was awarded the status of being a “Family Friendly Company”;
  • Global Finance named the securities custody services provided by SEB banka the best in Latvia;
  • Euromoney named SEB banka the best bank in Latvia;
  • CV Online, the recruitment company, ranked SEB Banka as the second best among Latvian top employers;
  • The international financial magazine Global Finance named SEB banka the best bank in Latvia in 2019 for the fifth time.


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