AS OPTIVA PANK

ANNOUNCEMENT

27.04.99

 

COMMENTARY TO CONSOLIDATED FINANCIAL RESULTS 03/99

 

In Q1 1999, the affiliated group of Optiva Pank (hereinafter Optiva 

Group) earned net profit in the amount of 3.0 million EEK, including 

the profits of the largest subsidiaries AS Optiva Liising 1.2 million 

EEK and AS Optiva Arendus 1.0 million EEK.

 

Total income earned by Optiva Group in Q1 amounted to 51.9 million EEK 

The income structure in Q1 was the following: net interest income after 

loan provisions accounted for 18.6 million EEK (or 35.8%) of income, 

commissions and service fees received 12.1 million EEK (23.3%), income 

from the currency exchange operations 8.0 million EEK (15.5%), income 

from investments in shares 8.2 million EEK (15.8%) and other income 5.0 

million EEK (9.6%).

 

Non-interest bearing expenses of Optiva Group during the same period 

amounted to 34.9 million EEK, of which the share of personnel expenses 

was 51.3% (17.9 million EEK), other administrative expenses 29.2% (10.2 

million EEK), commissions and service fees paid 5.5%, other expenses 

14.1% and revaluation of assets 0.1%.

 

The balance sheet volume of Optiva Group increased during Q1 by 174.2 

million EEK or 5.4%, amounting to 3.37 billion EEK at the end of March.

 

Demand deposits of clients increased in Q1 by 144.1 million EEK or 

16.5%, including the increase of demand deposits of 60.9 million EEK or 

11.2%, and time deposits of 83.2 million EEK or 25.3%. Total volume of 

the clients’ accounts at the end of March amounted to 1.02 billion EEK, 

or 30.2% of balance sheet volume (27.3%). Of total volume of deposits, 

the demand deposits accounted for 59.5% (62.3%) and time deposits for 

40.5% (in December 1998 37.7%).

 

The share of interest-bearing time resources in foreign capital 

decreased by the end of March to the level of 72.5% (in December 1998 

75.4%), mainly on the account of rapid increase of the clients’ demand 

deposits.

 

Among time resources, the volume of debt securities issued decreased by 

34.0 million EEK or 4.2%.

 

In Q1, the relative importance of non-interest bearing liabilities in 

foreign capital increased to the level of 7.4% (in December 1998 5.6%), 

which was mainly due to increase in the balance sheet account of 

“Clearing Accounts” by 69.4 million EEK, or 69.5%.

 

The volume of Optiva Group’s owners’ equity as of the end of Q1 was 

338.4 million EEK, accounting for 10.0% of balance sheet volume (in 

December 1998 10.5%). The group’s capital adequacy was 12.1%.

 

The Group’s interest-bearing assets increased in Q1 by 157.9 million 

EEK, or 6.3%. Among interest-bearing assets, the shorter-term 

investments in liquid instruments increased and longer-term investments 

decreased.

 

On the assets side of the balance sheet of Optiva Group, the greatest 

increase during Q1 occurred in time and demand deposits with other 

banks, i.e. by 155.0 million EEK and 33.7 million EEK (9.7%) 

respectively. The share of deposits with other banks in the balance 

sheet volume thus increased to the level of 15.9% (in December 1998 

10.8%). Volume of cash in hand account increased by 14.2 million EEK or 

23.8%.

 

As of the end of March, Group’s interest-bearing assets accounted for 

78.8% of the balance sheet volume (in December 1998 78.2%), short-term 

and long-term investments in shares 4.4% (in December 1998 4.6%), 

tangible and intangible assets 10.7% (in December 1998 11.4%) and other 

assets 6.0% (in December 1998 5.8%).

 

Net loan portfolio decreased in Q1 by 28.3 million EEK, or 1.4%. At the 

end of March, net loan portfolio accounted for 57.5% of total assets.

 

Allowances for doubtful accounts accounted for 10.8% of gross loan 

portfolio at the end of March.

 

Net loan portfolio’s share in interest-bearing assets was 73.0% (in 

December 1998 78.7%), whereas the share of investments in debt 

securities was 6.6% (in December 1998 6.9%).

 

 

Piret Villman

Manager of Budget and Planning Department

AS Optiva Pank

Tel. +372 63 02 103