Banks, Deposits, Financial Services, Lithuania, Loan

International Internet Magazine. Baltic States news & analytics Tuesday, 22.09.2020, 03:27

Lithuanian banks' profits down to EUR 128 mln in H1

BC, Vilnius, 14.09.2020.Print version
Banks and foreign bank branches in Lithuania saw their combined net profit drop by 28.6% in the first half of 2020 to 127.9 million euros, from 179 million euros a year ago, reports LETA/BNS.

Ten banks and foreign bank branches ended the first half with a profit, and six suffered losses. Most of the latter were banks in the process of starting or closing their business, the Bank of Lithuania said on Monday.

Well-established banks were profitable, although many of them also saw their profit indicators go down this year.

"The strict quarantine restrictions that were in place for several month, meant to bring the coronavirus pandemic under control, and the related uncertainty surrounding economic development lead to a contraction of banks' loan portfolio and had significant impact on the financial result," Jekaterina Govina, director of the Supervision Service of the Bank of Lithuania, said in a statement.

In her words, operating under the quarantine conditions due to the coronavirus, banks mainly focused on the analysis of existing clients' financial state, the restructuring of their loans, and not on issuing new loans or attracting clients.

Banks' total assets stood at 33.122 billion euros in late June, up 5.8% from late march and up 17.6% from late June, 2019. The loan portfolio, including leasing and making the majority of banks' assets, shrank 3.5% over a quarter and went down 1.2% year-on-year to 19.856 billion euros.

Following the coronavirus outbreak, banking deposits rose considerably, rising 20.4% to 27.171 billion euros in late June, from a year earlier, and going up by 7% from late March, 2020.

All banks complied with the capital adequacy requirements at the end of the first half.

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