Estonian Banks’ First-Quarter Profit Declines 22% on YearOtt Ummelas
Estonian banks’ net income declined 22 percent in the first quarter from a year earlier, mainly due to lower net-interest income.
Profit dropped to “about” 81 million euros ($105 million) from 104 million euros, the central bank, based in the capital, Tallinn, said today in an e-mailed statement. Net interest income declined 16 percent in the same period due to low base interest rates, it said.
The Baltic nation’s lenders, led by local units of Stockholm-based Swedbank AB and SEB AB, reported underlying net profit increasing 8 percent last year as corporate lending recovered following a slump in 2008 and 2009 when the Baltic economies went through the deepest contractions in the 27-member European Union.
Swedbank, the largest Baltic lender, expects corporate loan market in Estonia to continue growing this year as export-driven growth needs additional investment, Priit Perens, head of Swedbank’s local unit, said in an interview on Feb. 20.
Credit growth to companies and households accelerated in March to 2.8 percent from a year earlier from 2.4 percent the previous month, with the stock of loans and leases by companies having inreased 7.1 percent on year by the end of last month, the central bank said. Amortization of mortgage loans still exceeded new loan issuance, which grew 22 percent on year, according to the central bank.
Savings growth accelerated to 8 percent from a year earlier, compared with 7 percent in February, the central bank said.