Last update: 29.11.2024 20:31 (GMT+2)
Hansapank FINANCIAL RESULTS 08/18/2004
FINANCIAL RESULTS, Q2 2004 1/2
Highlights:
- Net profit € 42.6 million in Q2 2004, +46.9% yoy
- Semi-annual net profit € 85.4 million, +34.3% yoy
- Operating profit before tax 23% yoy and +12% qoq
- Total income +11.4% yoy and +9.2% qoq
- Total operating expenses +6.4% yoy and +5.7% qoq
- Stabilisation in interest margins due to a decrease in the cost of
foreign funding and strong loan growth. Net interest margin 3.39% in
Q2 2004, -36bp yoy and -2bp qoq
- Return on equity (ROE) 23.8%, return on assets (ROA) 2.4%, earnings
per share (EPS) € 0.54
- Annual loan growth 37%, 9% qoq
- Annual deposit growth 21%, 7% qoq
Second quarter results influenced by:
- Continuing strong volume growth
- One-off revenues worth € 3.8 million (sale of property, EU micro
credit fees)
- Modest cost growth
- Dividend income tax worth € 5.1 million vs € 9.9 million in Q2 2003
Hansabank Group CEO, Indrek Neivelt: "The start to the year 2004 has
been very successful for Hansabank Group. On the financial side all
business units have exceeded expectations during the first half of
2004. The developments have been particularly positive in our Latvian
business unit. In one year the Latvian net profit has increased by
148%, loans by 41% and deposits by 28%. Due to faster growth in Latvia
and Lithuania the weight of the Estonian business unit in the Group’s
results is constantly decreasing - in the second quarter Estonian
share in net profit had already decreased to 54%."
HANSABANK GROUP - NO 1 IN THE BALTIC RETAIL BANKING MARKET
The past 12 months have been very successful for Hansabank,
particularly in retail banking. The Group has become the market leader
in the most important categories of retail banking in each of the
Baltic countries - Estonia, Latvia and Lithuania. We are the leaders
in retail deposits, mortgage loans and pension savings.
At the end of June, the Group’s mortgage market share in Estonia was
50%, in Latvia 24% and in Lithuania 30%. In the II pillar pension
market the Group’s position is even stronger - over 0.6 million
customers in the Baltics have chosen Hansabank Group as their pension
asset manager, representing roughly half of all people who have joined
this system to date.
Q2 2004 RESULTS
Hansabank Group earned a net profit of € 42.6 million in the second
quarter of 2004. The Group’s operating results continued to improve on
the back of strong volume growth as operating profit before provisions
increased by 16.0% yoy. The biggest increase came from the Group’s
Latvian business unit, whose net profit more than doubled to € 10.3
million. The strong 32% growth in the Estonian business unit’s net
profit to € 22.9 million resulted mostly from a € 4.8 million decrease
in the dividend income tax expense compared to the same period last
year. The Lithuanian result improved by 11% during one year to € 6.2
million. The Group’s Russian and other operations earned a net profit
of € 3.2 million. In both years, the second quarter results include
one-off gains from the sale of property and annual fees for EU micro
credit. In Q2 2003 those items totalled € 2.4 million and € 0.7
million respectively, while this year the amounts were € 2.4 million
and € 1.4 million, respectively.
REVENUES AND EXPENSES
The Group’s net interest margin remained almost unchanged during the
second quarter, decreasing by a marginal 2bp from the first quarter to
3.39%. The annual decrease now stands at 36bp. The margin was
primarily supported by a decrease in the cost of funding, but also by
strong loan growth. On the asset side the decrease in the yield of the
loan portfolio is also slowing down - during the last 4 quarters
respective quarterly decreases in the yield have been 57bp in Q3 03,
32bp in Q4 03, 17bp in Q1 04 and 15bp in Q2 04. As a result the growth
rate of interest revenues from lending activities is gradually
recovering to double-digit levels, with 11.0% growth yoy and 5.4%
growth qoq, which is the best quarterly growth rate since Q3 2001.
Net fees increased by 18.9% yoy with most of the growth coming from
three traditional sources. Loan and leasing fees increased by 32.6%
during one year, fees from bank cards rose by 29.8% yoy and fees for
settlement (cash transactions and transfers) by 15.9%.
Operating expenses increased by 6.4% yoy and by 5.7% qoq to EUR 48.3
million. The fastest growing item was personnel expense, which
increased by 12.4% yoy. The annual growth of data network,
administrative and other expenses remained between 8 - 9%.
The Group’s cost-income ratio (before provisions) was 44.2% compared
to 46.5% in Q2 2003. The ratio of operating expenses to total assets
improved to 2.65% from 3.16% a year ago.
PROVISIONS AND ASSET QUALITY
The Group’s asset quality has constantly improved with the portfolio
becoming more diversified and mortgage loans forming an increasing
part of the portfolio. Loan and guarantee losses totalled € 9.5
million in Q2 2004, which is 13% more than in the previous quarter,
but 3% less than in the same quarter last year. At the same time
absolute growth of total loans increased by 64% compared to Q1 2004
and by 104% compared to Q2 2003.
Recoveries totalled € 3.2 million in Q2 2004. The Group’s net risk
cost was 0.1% versus 0.2% in Q1 2004.
LENDING AND DEPOSITS
The loan portfolio increased by € 0.42 billion, or 9% during the
second quarter to € 5.08 billion. Annual growth was € 1.41 billion or
38%. 37% of the annual growth came from Estonia, 32% from Lithuania,
25% from Latvia and 6% from Russia. By the end of June more than half
of Hansabank Group’s operations were outside Estonia, with the
Estonian loan portfolio forming 48% of the total (-4pp yoy), Lithuania
contributing 25% (+2pp yoy), Latvia 23% (+1pp yoy) and Russia 4% (+1pp
yoy). Lending to private individuals formed 39% of the growth, with
real-estate management and wholesale and retailing both contributing
another 15%.
Customer deposits increased by 7%, or € 0.28 billion during the second
quarter to € 4.56 billion. Estonian deposits increased by € 127
million, Latvian by € 75 million and Lithuanian by € 68 million. Our
Russian business unit’s customer deposits increased by € 12 million to
€ 83 million. Annual growth of deposits increased quite drastically in
the second quarter, rising to 21% at the end of June from 15% at the
end of March. At the end of June the loan to deposit ratio stood at
111% (108% at the end of Q1 2004). The Group’s deposit market shares
as at June 30 were 57% in Estonia, 16% in Latvia and 31% in Lithuania.
Assets under management totalled € 0.47 billion at the end of the
second quarter, an increase of 39% yoy.
1 EUR = 15.6466 EEK
Mart Tõevere
Head of Corporate Communications and IR
Tel. +372 6131 569
CONSOLIDATED BALANCE SHEETS
(in millions of euros,
unaudited)
30.06.04 31.12.03 30.06.03
Assets
Cash 146.2 159.9 144.5
Due from Central Bank 349.2 361.8 269.6
Due from other financial 699.6 564.9 612.9
institutions
Treasury securities 392.3 361.9 313.7
Trading securities 87.3 93.0 86.2
Investment securities 179.5 151.2 159.2
Loans 5,078.5 4,395.5 3,716.7
- Allowances for credit -69.4 -60.8 -55.2
losses
Net loans 5,009.1 4,334.7 3,661.5
Tangible assets 109.8 117.3 116.8
Intangible assets 27.6 18.1 22.9
Prepayments and accrued 134.8 165.4 204.2
interest
Other assets 173.2 80.4 76.2
Total assets 7,308.6 6,408.6 5,667.7
Liabilities
Due to Central Bank and 7.0 50.0 12.6
government
Due to other financial 471.1 461.0 395.9
institutions
Deposits 4,580.0 4,076.7 3,800.8
Demand deposits 3,323.0 2,890.7 2,573.1
Time deposits 1,257.0 1,186.0 1,227.7
Debt securities issued to the 1,122.7 775.3 480.2
public
Accrued liabilities 120.6 134.9 137.3
Appropriations 111.8 47.5 42.3
Deferred tax liability 1.1 1.4 1.5
Other liabilities 140.2 138.8 141.3
Total liabilities 6,554.5 5,685.6 5,011.9
Minority ownership 9.2 8.3 4.7
Subordinated liabilities 18.6 44.0 44.3
Shareholders' equity
Common stock 202.8 50.7 50.7
Share premium 29.3 181.0 180.4
Treasury stock -1.0 -0.5 -1.0
Reserves 29.9 29.5 29.4
Other restricted equity 6.4 6.4 6.4
Currency translation reserve -5.5 -11.2 -6.5
Retained earnings 464.4 414.8 347.4
Total shareholders' equity 726.3 670.7 606.8
Total liabilities and 7,308.6 6,408.6 5,667.7
shareholders' equity
CONSOLIDATED INCOME STATEMENTS
(in millions of euros,
unaudited)
Q2 2004 2003 Q2 2003
Interest income 88.3 316.9 78.7
Interest expense -29.1 -109.0 -26.7
Interest income, net 59.2 207.9 52.0
Fee and commission income 40.4 130.3 33.1
Fee and commission expense -8.9 -28.1 -6.6
Fees and commissions, net 31.5 102.2 26.5
Net result from financial 8.5 36.7 11.0
operations
Net income from insurance 1.7 1.7 0.4
activities
Other income 3.9 11.7 4.2
Total income 104.8 360.2 94.1
Operating expenses
Personnel expenses 23.5 85.5 20.9
Data network expenses 3.9 14.8 3.6
Administrative expenses 8.9 33.8 8.2
Other expenses 7.4 27.4 6.8
incl. goodwill amortisation 2.0 6.3 1.6
Depreciation 4.6 22.5 5.9
Total operating expenses 48.3 184.0 45.4
Operating profit before 56.5 176.2 48.7
provisions
Losses on loans and guarantees -9.5 -41.7 -9.8
Recovered loans 3.2 12.3 1.9
Profit from associates under 0.1 0.3 0.1
the equity method
Profit before income tax 50.3 147.1 40.9
Income tax -7.2 -15.3 -11.6
Profit after income tax 43.1 131.8 29.3
Minority interest -0.5 -0.9 -0.3
Net profit 42.6 130.9 29.0
CONSOLIDATED INCOME STATEMENTS - QUARTERLY
(in millions of euros,
unaudited)
Q2 2004 Q1 2004 Q4 2003 Q3 2003 Q2 2003
Interest income 88.3 82.9 80.3 78.5 78.7
Interest expense -29.1 -27.8 -27.1 -26.8 -26.7
Interest income, net 59.2 55.1 53.2 51.7 52.0
Fee and commission income 40.4 33.7 35.1 33.0 33.1
Fee and commission expense -8.9 -7.4 -7.7 -7.6 -6.6
Fees and commissions, net 31.5 26.3 27.4 25.4 26.5
Net result from financial 8.5 10.6 9.0 8.8 11.0
operations
Net income from insurance 1.7 0.9 0.2 0.5 0.4
activities
Other income 3.9 3.1 1.8 3.3 4.2
Total income 104.8 96.0 91.6 89.7 94.1
Operating expenses
Personnel expenses 23.5 22.5 24.4 19.7 20.9
Data network expenses 3.9 3.3 4.5 3.4 3.6
Administrative expenses 8.9 8.7 9.0 8.4 8.2
Other expenses 7.4 6.2 8.2 6.9 6.8
incl. goodwill amortisation 2.0 2.0 1.5 1.7 1.6
Depreciation 4.6 5.0 5.0 5.5 5.9
Total operating expenses 48.3 45.7 51.1 43.9 45.4
Operating profit before 56.5 50.3 40.5 45.8 48.7
provisions
Losses on loans and guarantees -9.5 -8.4 -11.0 -12.2 -9.8
Recovered loans 3.2 3.0 3.4 3.6 1.9
Profit from associates 0.1 - 0.1 - 0.1
Profit before income tax 50.3 44.9 33.0 37.2 40.9
Income tax -7.2 -1.5 -1.1 -1.3 -11.6
Profit after income tax 43.1 43.4 31.9 35.9 29.3
Minority interest -0.5 -0.6 -0.3 -0.2 -0.3
Net profit 42.6 42.8 31.6 35.7 29.0
COUNTRY-BASED BALANCE SHEETS, 30.06.2004
(in millions of euros, Est Lat Lit Rus
unaudited)
Assets
Cash 48.5 44.4 53.3 -
Due from Central Bank 190.8 59.3 99.1 -
Due from other financial 498.1 59.3 156.8 0.9
institutions
Treasury securities 8.3 202.7 181.4 -
Trading securities 15.4 9.3 62.6 -
Investment securities 52.8 0.3 126.4 -
Loans 2,439.5 1,185.1 1,275.9 178.2
- Allowances for credit -35.7 -16.3 -14.7 -2.5
losses
Net loans 2,403.8 1,168.8 1,261.2 175.7
Tangible assets 26.1 42.1 41.4 0.1
Intangible assets 2.1 1.9 23.6 -
Prepayments and accrued 71.2 21.1 29.3 15.3
interest
Other assets 165.1 16.2 5.8 0.5
Total assets 3,482.2 1,625.4 2,040.9 192.5
Liabilities
Due to Central Bank and 3.9 - 3.0 -
government
Due to other financial 371.6 331.2 329.8 118.4
institutions
Deposits 2,046.5 1,023.8 1,426.7 83.8
Demand deposits 1,564.9 717.5 957.6 83.8
Time deposits 481.6 306.3 469.1 -
Debt securities 1,122.7 22.5 - -
Accrued liabilities 67.5 24.6 29.9 0.7
Appropriations 55.4 3.0 54.4 0.1
Other liabilities 69.1 57.5 21.2 1.9
Minority ownership 0.7 - 0.8 7.6
Subordinated liabilities 15.3 10.4 - -
Internal funding adjustments -501.7 43.6 36.9 -33.1
Shareholders' equity 231.2 108.8 138.2 13.1
Total liabilities and 3,482.2 1,625.4 2,040.9 192.5
shareholders' equity
*The deposits under the Russian business unit are collateral deposits
provided by Russian customers.
COUNTRY-BASED INCOME STATEMENTS, Q2 2004
(in millions of euros, Est Lat Lit Rus
unaudited)
Interest income 44.4 21.2 19.6 3.5
Interest expense -15.6 -6.4 -6.7 -0.7
Interest income, net 28.8 14.8 12.9 2.8
Fee and commission income 20.4 9.7 9.5 0.8
Fee and commission expense -3.7 -2.0 -2.7 -
Fees and commissions, net 16.7 7.7 6.8 0.8
Net result from financial 3.2 3.7 1.4 0.2
operations
Net income from insurance 0.7 - 1.0 -
activities
Other income 1.7 0.6 1.0 -
Total income 51.1 26.8 23.1 3.8
Operating expenses
Personnel expenses 7.9 4.9 6.5 0.1
Data network expenses 4.4 2.6 2.8 -
Administrative expenses 3.2 2.3 2.7
Other expenses 2.1 1.7 3.0 0.1
incl. goodwill amortisation 0.1 0.3 1.6 -
Depreciation 0.5 0.5 0.7 -
Group overhead adjustment 1.5 0.6 0.7 0.3
Total operating expenses 19.6 12.6 16.4 0.5
Operating profit before 31.5 14.2 6.7 3.3
provisions
Losses on loans and guarantees -4.7 -2.6 -1.7 -0.5
Recovered loans 1.2 0.4 1.6 -
Income from associated 0.1 - - -
companies
Profit before income tax 28.1 12.0 6.6 2.8
Income tax -5.1 -1.6 -0.4 -
Profit after income tax 23.0 10.4 6.2
Minority interest -0.1 - - -0.5
Net profit 22.9 10.4 6.2 2.3
Mart Tõevere
Head of Communications and IR
+372 6131 569
Sitemap