Riga, 23.03.2010
Press Release
Latvian bank performance update: February 2010
Financial and Capital Market Commission releases recent data on the performance of Latvian banks for February 2010.
In February, all the Latvian banks met regulatory requirements; liquidity ratio in the banking sector increased and was 62.1% at the end of accounting month (compared to 61.4% at end-January). Capital adequacy ratio also grew and by end-February was 14.6% (compared to 14.3% at end-January). As from the beginning of 2010, two banks increased their capital by the total of 44.5 million lats and paid-up share capital in the banking sector accounted for 1.7 billion lats by end-February (all in all, 13 Latvian banks increased their capital by 998.2 million lats in 2009).
By end-February, the amount of deposits in the Latvian banking sector amounted to 9.5 billion lats, namely, by 0.2% or 16.1 million lats down from the end of January. Total amount of deposits in February shrank mostly due to a seasonal decrease in non-resident deposits by 5.6%, or 202.4 million lats, while total amount of resident deposits in February rose by 3.2%, or 186.3 million lats, including an increase in both corporate deposit and private person deposit stocks.
In February, the Latvian banking assets fell by 0.7% or 148.6 million lats and by end-February totalled 21.3 billion lats. Total loan portfolio of banking sector shrank by 0.5% or 69.9 million lats in February and by the end of accounting month made up
15.3 billion lats, where resident household loan balance contracted slightly slower than resident corporate loan balance, i.e. by 0.3% and 0.4%, respectively. Meanwhile loan portfolios of nine Latvian banks and one foreign bank branch increased in February (constituting 11.7% of total market share in the banking sector loan portfolio).
At the end of February, of total loans 71.2% were without payment delays (72.1% at end- January). In February, the amount of loans with more than 90 days overdue payments grew by 1.1% and their share in the banking loan portfolio made up 17.7% (compared to 17.4% at end-January). For loans with more than 90 days overdue payments, the major share constituted resident corporate loans for real estate transactions (29%) and resident household loans for housing acquisition (28%).
In February, loan loss provisions in the banking sector overall increased by 2.8% or 37.8 million lats (compared to 2.3% or 31 million lats in January), totalling
1.4 billion lats or 9.1% of total banking loan portfolio (compared to 8.9% at end-January).
By end of February, nine Latvian banks and one foreign bank branch posted profit (constituting 24.8% of total banking sector assets) and earned the total of 1.5 million lats, however, the banking sector overall reported a 59.3 million loss in February - mostly due to expenses on loan loss provisioning. The banking sector's profit in February (before provisioning and tax) amounted to 14.6 million lats.
Anna Dravniece
Head of Office
Financial and Capital Market Commission
Phone: +371 6777 4800, email: anna.dravniece@fktk.lv
Prepared by:
Agnese Joela
Public Relations Specialist
Financial and Capital Market Commission's Office
Phone: +371 67774808; email: agnese.joela@fktk.lv