Banks, Financial Services, Latvia

The number of customers choosing Swedbank as their main bank increased by more than 45,000 in 2011, writes LETA.

Swedbank Latvia, including insurance business, reported a profit of LVL 80.4 million in 2011, compared to LVL 45 million losses in 2010. The improved result is mainly due to net recoveries. Profit before credit impairments was LVL 70.9 million in 2011.

The volume of customer deposits was LVL 1.487 billion at the end of Q4 2011, and increased by one percent year-on-year.

Swedbank issued LVL 276 million in new loans in 2011, LVL 229 million of which was made available to businesses. The total net credit portfolio shrank by 12% last year compared to the end of Q4 2010. This was mainly due to portfolio amortization and diminishing new loan demand. Swedbank net credit portfolio was LVL 2.54 billion at the end of Q4 2011.

The loan-to-deposit ratio continued to improve last year, falling to 171% (196% at the end of Q4 2010). The volume of client deposits increased in 2011 in spite of false rumors spread through social media in Latvia about Swedish banks.

Net recoveries for 2011 amounted to LVL 25.9 million (compared to LVL 123.4 million in credit impairments for the previous year), mainly in corporate credit portfolio. Impaired loans, gross, continued to decline throughout the year and amounted to LVL 605 million, down from LVL 890 million at the end of Q4 2010. The bank points out that it expects this trend to continue.

"Last year, we developed our customer service model and strengthened several business indicators. This was reflected by our customers, which is evident in the strong growth in deposits, an increase in new lending and improved quality in our credit portfolio. Our aim is to provide great service and solutions for our customers' needs. The number of customers who chose Swedbank as their main bank increased noticeably, clients also appreciated regular finance consultations. These indicators show that our chosen model of long-term relationship is the right direction to further development," the head of Swedbank Latvia Maris Mancinskis said.

In 2011, the bank's revenues decreased by two percent. Expenses decreased by 1.5%.

In 2012, Swedbank's focus will be on further strengthening a customer-centric business model based on long-term relationships with customers, whilst always keeping an eye on efficiency, the bank informed.

In 2011, the international finance magazine "Global Finance" named Swedbank the best bank in Latvia and Estonia, and Swedbank's personal Internet banking service as the best in the Baltics.