Bigbank unaudited financial results for 2022 Q3 and 9 months


In the third quarter of 2022, Bigbank made a net profit of 14.3 million euros, which is 17.7% more than in the same period last year. Profit for the nine months of 2022 was €28.4 million, representing a year-on-year growth of €5.3 million (23.0%). Third quarter profit before loss allowances and income taxes amounted to 20.4 million euros. Charges on provisions for credit losses amounted to 4.2 million euros. Interest income amounted to 32.7 million euros, an increase of 12.2 million euros (59.8%) compared to the same period last year.

Bigbank’s loan portfolio grew, growing in nine months by 39.0% and in the third quarter by 12.2%. At the end of the third quarter, the Group’s performing loans portfolio amounted to 1.2 billion euros, exceeding the 2021 year-end figure by 354.1 million euros (39.8%). The share of loans past due for more than 90 days represents 1.3% of the total portfolio, indicating a continuous improvement in the quality of the portfolio during the year, the same indicator being 3.0% for the nine months of 2021.

The third quarter profit of the corporate banking segment amounted to 8.1 million euros, an increase of 6.6 million euros compared to the previous quarter. In addition to the rapid growth of the loan portfolio and its high quality, the solid quarterly profit of the corporate banking segment was also strongly influenced by gains from the revaluation of the underlying assets of the special terms investment loans. amounting to 6.9 million euros. . Revaluation gains on loans that carry investment risk are calculated annually, based on movements in the market value of clients’ investment properties and the agreed profit-sharing scheme. The corporate credit portfolio increased by €68.7 million (20.0%) during the quarter.

The home loan portfolio increased by 27.7% to 186.9 million euros in the third quarter. Compared to the end of 2021, the portfolio has been multiplied by more than 1.5.

In nine months, deposits increased by 38.6% and in the third quarter by 6.5%. The fastest growth was again recorded by savings deposits, which increased by 10.7% to 542.5 million euros in the third quarter, representing 43.6% of the deposit portfolio at the end of the trimester. The Group’s investment property portfolio, which includes both agricultural land and commercial real estate, reached 47.4 million euros at the end of the quarter.

Income statement, in thousands of euros

Q3 2022

Q3 2021

9M 2022

9M 2021

Net interest income

28,627

18,493

68,364

51 161

Net fee and commission income

1,891

1,676

5,511

4,652

Net income (loss) on financial assets

-161

-57

-464

-168

Other net operating income

170

-426

243

-1,302

Total net operating income

30,527

19,686

73,654

54,343

Salaries and associated charges

-5,279

-4,308

-15,787

-12,616

Administrative expenses

-4,586

-3,780

-12,723

-10,221

Amortization and depreciation

-1,034

-842

-3,003

-2,531

Other gains (losses)

804

3,873

673

4,234

Total expenses

-10,095

-5,057

-30,840

-21,134

Earnings before provisions for losses

20,432

14,629

42,814

33,209

Provisions for net losses on loans and financial investments

-4,186

-1,488

-10,744

-7,988

Profit before income tax

16,246

13,141

32,070

25,221

income tax expense

-1,946

-989

-3,708

-2,168

Profit for the period

14,300

12,152

28,362

23,053

Statement of financial position, in thousands of euros

Sep 30, 2022

June 30, 2022

Sep 30, 2021

Cash and cash equivalents

141 163

173,611

109,535

FVOCI debt instruments

45 171

46,065

47,066

Loans to customers

1,258,177

1,114,146

760 725

other assets

103,356

101,584

101,999

Total assets

1,547,867

1,435,406

1,019,325

Customer deposits and loans received

1,281,161

1,204,918

826,064

Subordinate Notes

40,049

20,023

5,055

Other liabilities

17,521

17,449

14,990

Total responsibilities

1,338,731

1,242,390

846 109

Equity

209 136

193,016

173 216

Total Liabilities and Equity

1,547,867

1,435,406

1,019,325

In addition to regular activities, several circumstances had an impact on the results of the third quarter and on the future activity of the Group in general:

The most significant event of the period was the listing of Bigbank’s subordinated unsecured bonds on the Nasdaq Tallinn Stock Exchange on September 22. The base amount of €10 million was more than twice oversubscribed. The amount of the issue was 20 million euros. 20,000 bonds were issued with a nominal value of 1,000 euros each, a fixed annual coupon rate of 8% and a maturity of 10 years. 20 million euros of additional capital will enable the bank to support its growth in the business banking and home loan segments.

This year, the start of the new business strategy period of 2022-2026 has begun for Bigbank. In order to support the new business strategy and achieve the expected return on capital, the Bigbank AS Board of Directors has taken decisions regarding the future operations of the Swedish and Bulgarian branches. In August it was decided to suspend the issuance of new bonds at the Swedish branch from 1 September 2022, in October it was decided to suspend the issuance of new bonds at the Bulgarian branch from 1 November 2022. The Group will continue to raise deposits and service its existing loan portfolio in Sweden and Bulgaria.

Comment from Bigbank CEO Martin Länts:

“Despite the turbulent external environment, we have reason to be pleased with Bigbank’s financial performance in the third quarter – the period was characterized by strong loan book growth, continued quality improvement and good earnings.

In the third quarter, the loan portfolio grew the most in the business loan and home loan sectors, which is one of the most important objectives of the bank’s business strategy. An increase in the sale of Euribor-linked loan products helps us diversify our portfolio and has a positive impact on earnings in a situation where interest rates are rising and deposits are becoming more expensive.

This summer, ratings agency Moody’s Investors Service completed Bigbank’s assessment and assigned the bank long-term Baa3 and short-term Prime-3 ratings in foreign and local currencies. The investment grade rating Moody’s has assigned to us, as disclosed on July 1, 2022, provides assurance to our current depositors and partners about Bigbank’s operating model and the quality of our portfolio, and supports our future expansion to the international.

The base volume of the subordinated unsecured bond issue in September was oversubscribed by more than two times. This is a landmark achievement for Bigbank, indicating that investors have confidence in our business strategy and our ability to successfully execute that strategy. I thank all the investors for placing their trust in Bigbank”.

Bigbank’s financial statements can be viewed here: https://investor.bigbank.eu/reporting/

Bigbank AS (www.bigbank.eu) is an Estonian-owned bank specializing in loans and deposits for individuals and businesses. In addition to operations in Estonia, the bank has branches in Finland, Sweden, Latvia, Lithuania and Bulgaria and offers its products as cross-border services also in Austria, Germany and the Netherlands. The Bigbank’s balance sheet total exceeds 1.5 billion euros.

Argo Kiltsmann
Member of the Management Board
Telephone: +372 5393 0833
Email: [email protected]
www.bigbank.ee

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