Last year, the profit of Latvian banks increased by 22.4%; amount of deposits – 18.66 billion euros / Article / LSM.lv

The amount of deposits in Latvian banks increased by 5% or 0.92 billion euros in the 4th quarter of this year and reaches 18.66 billion euros, which is the largest amount of retail and corporate deposits since 2017, the Financial Industry Association informed. Over the last 12 months, deposits have increased by 8% or 1.45 billion euros. The data of the association also show that in 2020 the Latvian banking sector operated with a profit of 146.017 million euros, which is 22.4% more than a year earlier.

Last year, five banks were operating at a loss, while seven were operating at a profit, including the largest Swedbank and SEB banka. Data are not available on the Latvian branch of Luminor Bank.

The largest deposits at the end of the 4th quarter of 2020 were Swedbank (5.85 billion euros), SEB banka (3.51 billion euros), Citadele (3.45 billion euros), Luminor Bank Latvia branch (EUR 2.89 billion) and BlueOrange Bank (EUR 0.54 billion). The most significant increase is observed in corporate deposits.

Source: Information provided by members of the Financial Industry Association, unaudited data

Over the past year, they have increased by 0.98 billion euros and reach 42% of the total amount of deposits in banks in Latvia.

Kārlis Danēvičs, Co-Chairman of the Credit Committee of the Financial Industry Association, Member of the Board of SEB banka, assessed that the increase in the amount of deposits is related to the current prudence. “We see that the demand for loans from companies is relatively low, caution is exercised and decisions on new investments in development are pending,” Danevics said.

The total capital of the banking sector reached 2.93 billion euros at the end of last year, which has increased by 10% or 0.26 billion euros in the last 12 months. During the 4th quarter of 2020, the capital of banks has increased by 2% or 0.05 billion euros.

The data of the association also show that the amount of loans issued by the banking sector last year was 12.95 billion euros. In the 4th quarter of 2020, the loan portfolio decreased by 3% or 0.34 billion euros. Over the last 12 months, the loan portfolio has decreased by 4% or 0.52 billion euros.