Banks, Deposits, Financial Services, Latvia, Loan

According to the Finance and Capital Market Commission, growing provisions for doubtful debts had a negative effect on the profits of credit unions. Most or 23 out of 33 Latvian credit unions closed 2017 with profits that totaled EUR 363,000.

Aggregate assets of Latvian credit unions stood at EUR 29.273 million at the end of 2017, up by 7.4% or EUR 2.028 million compared to the end of 2016. Assets increased mostly due to a rise in deposits made by members of the credit unions.

Deposits by the members are the main source of financing (99%) for credit unions. At the end of last year Latvian credit unions held EUR 20.876 million in deposits or by 6.4% or EUR 1.248 million more than at the end of 2016.

Loans issued by credit unions totaled EUR 22.261 million at the end of 2017, which is a growth by 14% or EUR 2.735 million year-on-year. Consumer loans and housing loans made up 42% and 46% of the loan portfolio respectively.

The quality of the loan portfolio worsened somewhat last year. Late in 2017, standard loans made up 57.4%, loans under supervision 38.1%, and substandard and non-performing loans 4.5% of the total portfolio. Provisions for doubtful debts increased to 7.2% of the loan portfolio at the end of 2017 from 6.9% at the end of 2016.

In 2016, profits of the Latvian credit unions totaled EUR 425,853.