Banks, Financial Services, Latvia, Loan, Markets and Companies

SEB Banka CEO Ieva Tetere said at a news conference today that the bank wants to increase lending this year. “The appetite for lending is there. It might reach up to EUR 1 bln this year,” Tetere said, adding at the same time that a question remains about opportunities for more extensive lending.

SEB Banka CFO Karlis Danevics mentioned several obstacles hampering lending growth, including a decreased number of new businesses and depopulation.

The bank would have liked to make more loans already last year, but the number of loan applications meeting crediting standards was limited, Danevics said. In his words, last year’s lending result was a good achievement and that it was important that the lending growth was extensive, not based on a few large deals.

The list of industries receiving the highest number of loans remained unchanged last year, with 14 percent of loans granted to farmers, 13% to manufacturers and 11 percent to traders. The share of loans granted to farmers, however, contracted from 20%  however, probably because of delays with the release of EU funding.

Property developers showed renewed activity last year, Tetere said, adding that the bank expects demand for loans in this segment to grow this year.

The SEB Banka CEO stressed that lending is the bank’s core business but that it has be sustainable.

The SEB Group’s loan portfolio expanded by 3 percent last year to EUR 2.5 bln.

Last year, SEB Banka doubled its portfolio of new mortgage loans, granting EUR 105 mln worth of housing loans in total. Nearly half of that amount, or EUR 50.7 mln, were extended under the government’s support program for families with children, managed by Altum development finance institution.

In 2016, SEB Banka extended EUR 154 mln in personal loans.

SEB Banka is the fourth largest bank in Latvia by assets.

SEB Group in Latvia posted EUR 52.3 mln in 2016 operating profit.