UK Leasing

Unaudited results of LHV group for the first quarter of 2021 tallinn stock exchange: LHV1T


In the first quarter of 2021, the AS LHV group achieved a total of 11.4 million euros in consolidated net income. During the quarter, the bank achieved a net profit of 11.8 million euros, including 2.2 million euros from customer services related to the UK branch. Varahaldus generated 0.6 million euros in net loss and Kindlustus 0.3 million euros in net loss. The Group’s return on equity for the first quarter was 18.2%.

Year-on-year, LHV Group net profit increased by 3.9 million euros (53%) in the first quarter and 6.6 million euros (37%) lower than at fourth quarter 2020, when the group profit also included the success fees related to the management of pension funds. At the end of the first quarter, LHV is ahead financially for 2021, released in February, by 0.9 million euros.

At the end of March, the asset volume of the consolidation group increased to 5.68 billion euros. During the quarter, the volume of the Group’s consolidated loan portfolio increased from 96 million euros (+ 4%; + 353 million euros in Q4) to 2.3 billion euros, and deposits increased from 614 million euros (+ 15%; + 904 million euros) in Q4) to 4.73 billion euros. In terms of growth in deposits, 595 million euros came from financial intermediaries and 54 million euros from regular customers, the share of deposit platforms fell by 35 million euros. The total volume of funds managed by LHV increased by € 50 million (+ 3%; + € 41 million in Q4) to € 1.59 billion.

Income statement, thousands of euros Q1-2021 Q4-2020 3 months 2021 3 months 2020
Net interest income 20,371 19,893 20,371 16,324
Net commission and commission income 8 640 14,183 8 640 6,508
Net gains on financial assets -375 1316 -375 -389
Income from insurance activities 89 0 89 0
Other income 40 57 40 36
Total revenue 28 765 35,449 28 765 22,478
Personnel costs -7 253 -6,368 -7 253 -5 769
Rent and office expenses -463 -239 -463 -278
IT expenses -1,005 -964 -1,005 -729
Marketing costs -532 -475 -532 -473
Other operating expenses -4 507 -3 381 -4 507 -3 926
Total operating expenses -13,760 -11,427 -13,760 -11,175
Profit before impairment losses 15,005 24023 15,005 11,303
Impairment losses on loans and advances -1,601 -2,243 -1,601 -1,011
Income tax -1 988 -3 741 -1 988 -2,809
Net profit 11,416 18,039 11,416 7 483
Profit attributable to non-controlling interests 373 200 373 404
Profit attributable to shareholders of the parent company 11043 17 840 11043 7,079
Balance sheet, thousands of euros March 2021 Dec 2020 March 2020
Cash and cash equivalents 3,193,146 2,393,537 1,284,182
Financial assets 149,739 330,055 231 321
Loans granted 2 322 518 2,225,681 1,746,205
Loan impairments -18 170 -16,858 -7,296
Receivables 5 185 9 388 2,780
other assets 30,005 29,604 30 148
Total assets 5 682 423 4,971,407 3,287,341
Sight deposits 4,272,474 3,635,166 2 357 463
Term deposits 461 369 484,604 595,948
Loans received 508,801 468,585 25,687
Loans received and deposits from customers 5,242,644 4,588,355 2 979 098
Other liabilities 74,544 27,776 26,093
Subordinated loans 110,000 110,000 75,000
Total responsibilities 5 427 188 4 726 131 3,080,191
Equity 255 235 245,276 207,150
Minority interests 6,756 8 483 4 190
Total liabilities and equity 5 682 423 4,971,407 3,287,341
Profitability ratios Q1-2021 Q4-2020 3 months 2021 3 months 2020
Return on equity 18.2% 31.3% 18.2% 14.0%
Cost / income ratio 47.8% 32.2% 47.8% 49.7%
Net gains on financial assets 0.3% 0.4% 0.3% 0.2%

In the LHV loan portfolio, loans to businesses increased by 68 million euros and loans to individuals by 28 million euros in the first quarter. In one year, the LHV Group’s loan portfolio increased by 565 million euros, or 33%. Regardless of the rapid growth, no compromise has been made on the credit quality which remains good; State wage subsidies and grace periods offered by banks have provided monetary buffers for borrowers. Most of the grace periods granted last year ended on time; the volume of loans subject to grace periods increased from the original 350 million euros to 60 million euros at the end of the first quarter. Also this year, the state established restrictions to prevent the virus; at the same time, since february, customers have only requested new grace periods to the tune of 11 million euros.

LHV is committed to supporting the achievement of climate goals. To make it easier to buy the most climate-friendly vehicles, we lowered the electric vehicle rental interest rate to 1.95% in March. The same interest rate also applies to the green home loan. These are the most favorable interest rates in LHV.

To boost investment activity, LHV reduced service fees for foreign securities in February. First, we have introduced to the market the pension investment account, or PIA, which pension savers can use to make investments themselves in the second pillar system. By mid-April, 2,000 investors had signed up for a PIA.

Among other significant events in the quarter, LHV group subsidiary LHV UK Limited was registered at UK Companies House in February. During the quarter, LHV Kindlustus began to take out the first home insurance contracts and took over extended warranty insurance contracts linked to the sale of technological devices by Euronics. LHV bank cards have been added the possibility of seeing their PIN code digitally, and the possibility for private customers to activate the permanent donation function on the debit card, which allows to contribute to charity with each payment by card .

Pension funds posted a positive rate of return, although actively managed funds were outperformed by index funds due to lower equity risk. Part of this is about maintaining the necessary liquidity in actively managed funds for clients leaving in September. At the end of March, the number of clients leaving Pillar II in September and their volume of assets became clear; these remained below estimates.

Comment from Madis Toomsalu, CEO of LHV Group:
“LHV got off to a strong start this year. We have continued to finance the Estonian economy, have taken the first successful steps of establishing a bank in the UK which requires regulatory licensing; we have vigorously increased our number of customers, strengthened the offerings of our services, and once again received the recognition of being the bank offering the best service.

We have increased our market share in the lending market and increased our role as a market leader in investment services. The key words are activity and willingness to contribute to the growth of Estonian capital. LHV also continued to fund its customers during the restrictions. In January and February, LHV’s market share in providing loans to Estonian companies was over 50%. For mortgage loans, the respective indicator was 12%. Interest in investing continues to grow as clients entered into nearly 16,000 new investment contracts during the quarter and more than 8,000 asset-holding clients were added. In terms of investment services, we have contributed to growth with the most comprehensive product portfolio, widely offering investment education, with the best brokerage service in the Baltic States and with the highest service fees. favorable.

The market value of LHV increased by more than 400 million euros during the year. I am extremely happy that the growth to become the largest listed company in Estonia and the resulting increase in value is distributed among 13,000 shareholders who are Estonian people and companies. “

AS LHV Group reports are available at: https://investor.lhv.ee/en/reports.

In order to present the quarterly results, LHV Group will organize an investor meeting via the Zoom webinar environment. The virtual investor meeting will take place on April 20 at 9:00 a.m. before the market opens. The presentation will be in Estonian. We kindly ask you to register at https://lhvbank.zoom.us/webinar/register/WN_EL2t_a7xSaGyQX9PBfitlw.

LHV Group is the largest domestic financial group and provider of capital in Estonia. The main subsidiaries of the LHV group are LHV Pank, LHV Varahaldus and LHV Kindlustus. LHV employs more than 560 people. LHV banking services are used by nearly 274,000 clients and the pension funds managed by LHV have almost 177,000 active clients. LHV’s UK branch provides banking infrastructure to 150 international financial services companies, through which LHV’s payment services reach customers around the world.


Priit rum
LHV Communication Manager
Telephone: +372 502 0786
Email: [email protected]



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