Swedbank’s profit in the first half of the year lower than last year

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Swedbank points out that net interest income has decreased by 1%. Meanwhile, the amount of the loan portfolio has remained stable compared to the same period last year. Household lending has grown by 5%, while the corporate loan portfolio has shrunk by 6%. The amount of deposits has increased by 23% compared to the first half of last year.

Net commission income has increased by 9%. They were mainly due to higher income from card and payment services and asset management.

Income from transactions with financial instruments, as well as insurance income has remained stable during the year. Total expenses for the first half of the year have grown by 15%. They continue to be affected by higher labor costs and the strengthening of money laundering risk reduction, risk management and compliance. Investments in the development of the bank’s digital services also continue.

Loan provisions in the first half of the year amounted to 6 million euros, compared to 3 million a year ago.

“Along with the easing of pandemic restrictions, the last quarter saw a sharp increase in customer activity in both day-to-day activities and housing. Although with more inertia, the readiness of entrepreneurs to invest in development is gradually increasing, and “Swedbank is highly prepared to support further economic growth. At the same time, we are pleased that the availability of Robur funds, which are popular in the Nordic countries, has increased the number of Latvians who invest their free funds in sustainable funds rather than in their account.

Faced with a resumption of economic activity, housing finance is experiencing strong growth. Swedbank’s mortgage lending offer has been competitive in order for the bank to maintain its leading position in a fast-growing market. However, consumer credit has not yet fully recovered from the effects of the pandemic.

The work invested in the field of sustainability has not gone unnoticed, as Swedbank has received the highest rating – Platinum – for the third year in a row in the annual Sustainability Index, which evaluates the performance and transparency of companies.

The range of investment fund offerings has become wider this half year. In the second quarter, two more Swedbank Robur funds became available to Swedbank customers – Robur Corporate Bond Europe and Robur Corporate Bond Europe High Yield. The supply has also responded to demand, as the amount of funds invested in Robur funds in Latvia has grown rapidly. Latvians have already invested more than 5.5 million euros in these funds.

The positive changes brought about by the pandemic include the rapidly growing demand of customers for virtual banking services. In order to increase the digital accessibility of the bank, opportunities for customers to receive video consultations have been introduced. This service has rapidly become popular, giving priority to offering an even wider range of video consulting services in the future. It is expected that this year Swedbank will already offer its customers an expanded video consulting platform.

For greater customer safety, we have made changes to the range of insurance services. Given the risks of COVID-19, uninsured risks of medical care and travel changes caused by a pandemic are also included in insurance cases. These risks are also included in the range of credit card services for individuals and companies at no extra charge.

During the first six months, Swedbank’s work in promoting public financial literacy has continued actively. A book for children with financial literacy has been published in Latvia, which has been donated to Latvian school libraries. The demand for this book has been so high that it has been decided to order an additional edition and offer the book to Latvian bookstores as well.

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