The shorter month of February brought lower interest income than usual, but LHV's result was supported by increased business volumes. In February, the consolidated loan portfolio of LHV Group increased by EUR 65 million, EUR 19.5 million of which was due to the growth of the loan portfolio in Estonia and EUR 45.3 million from the United Kingdom. The volume of consolidated deposits decreased by EUR 285 million. The volume of funds managed by LHV increased by EUR 14 million. In February, 6.4 million payments were made related to financial intermediaries.
The net profit of AS LHV Group was EUR 10.7 million in February. AS LHV Pank earned a net profit of EUR 9.8 million and LHV Bank Ltd EUR 472,000. In February, the net profit of AS LHV Varahaldus was EUR 159,000 and the net profit of AS LHV Kindlustus was EUR 36,000. The financial plan published in February remains unchanged.
Nasdaq named LHV Group the Best company for investor relations on the Baltic stock exchanges for the third time in February. At the same time, LHV Pank was declared the Stockbroker of the year.
The number of LHV Pank clients increased by 2,700 in February. Activity was increased by the start of income tax declaration period. In the loan portfolio, retail loans increased by EUR 27.5 million, while corporate loans decreased by EUR 8 million. Bank deposits decreased by EUR 305 million, while regular clients reduced deposits by EUR 48 million and financial intermediaries by EUR 230 million. Deposits from deposit platforms were also reduced. The loan write-downs reflected the repayments of individual clients' loans.
The strong growth of the loan portfolio of LHV Bank in the UK continued and it is increasing interest income. While the loan portfolio increased by EUR 45 million, there are still loans approved but not issued in the amount of EUR 161 million. Deposits from platforms increased by EUR 26 million. The volumes of payments and deposits in the business line of financial intermediaries largely corresponded to the business plan.
Development of the Bank's retail offerings continued: in February, the ordering of cards and making of card payments was opened to a smaller test group in the app. The entire development of the mobile app is taking place in-house, with the development team fully assembled.
In February, LHV Varahaldus announced that it would stop selling pension funds in shopping centres in March. In the future, Varahaldus will focus on other sales channels. In February, the company's expenses and revenues largely corresponded to the financial plan. Of the managed pension funds, M, L, and XL increased by 0.5%, 0.7%, and 0.8%, respectively, over the month. Pensionifond Indeks lost 1.7% in value and Roheline 1.6%. Conservative funds S and XS increased their value by 0.7%.
For LHV Kindlustus, February was a month with good sales results in terms of home and travel insurance. In February, the company entered into a total of 14,200 new insurance contracts with a volume of EUR 3.4 million. The number of loss events also increased, especially in travel insurance. A total of EUR 2.2 million in damages were indemnified. The expenditure ratio is on a downward trend.
In February, LHV published its financial plan and five-year financial forecast. According to the long-term forecast the group's loan portfolio is expected to increase 1.9 times over five years. Deposits are projected to grow by 65%. Fund volumes are expected to increase by 78%. Based on the five-year forecast LHV's consolidated net profit is expected to reach nearly €269 million by 2029, with an average annual growth rate of 12%.
LHV Group will convene the Annual General Meeting of Shareholders to be held at Hilton Tallinn Park Hotel on 26 March at 13.00. The Management Board has made a proposal to the General Meeting to pay dividends of 9 cents per share to the shareholders for 2024.
The reports of AS LHV Group are available at: https://investor.lhv.ee/en/reports.
LHV Group is the largest domestic financial group and capital provider in Estonia. The main subsidiaries of LHV Group are LHV Pank, LHV Varahaldus, LHV Kindlustus, and LHV Bank Limited. The Group employs more than 1,160 people. As at the end of February, the banking services of LHV are used by 462,000 clients, the pension funds managed by LHV have 113,000 active clients, and LHV Kindlustus protects a total of 174,000 clients. LHV Bank, a subsidiary of the Group, holds a UK banking licence and offers banking services to international fintech companies and loans to small and medium-sized enterprises.
Priit Rum
Communications Manager
Phone: +372 502 0786
Email: priit.rum@lhv.ee
