AS LHV Group

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  • #311205 Reply

    Nauris Treigys
    Keymaster

    In November, the consolidated net profit of LHV Group reached EUR 2,0 million: of the major units the Bank earned EUR 1.2 million and Asset Management EUR 0.4 million. Profit belonging to group’s shareholders was EUR 1.6 million.

    Madis Toomsalu, CEO of AS LHV Group commented:
    “November was mainly characterized by record reaching interest income, which is based on intense work in growing our loan volumes. In November the bank’s loan portfolio grew by EUR 26 million and for a third month in a row our Lithuanian business unit showed strong results, the loan portfolio there has increased about EUR 2 million per month. The volumes of client deposits, loans and funds reached new historical highs. LHV’s actively managed pension funds held up best in the context of falling financial markets, on the background of relatively high stock prices our funds’ focus is mainly set on local investments.

    In November, we added purchase insurance to our LHV Gold card and started offering additional security to card payments over the internet, known as 3-D Secure. At the turn of the month, we launched the LHV Home insurance that has already been well received by customers. In November, the Estonian Financial Authority resolved to allow LHV Pank establishing a branch in the United Kingdom and forwarded necessary documents to British financial authority. We can establish and register the new branch after receiving a confirmation from the supervising authority in the UK.

    The net profit in November was EUR 2.0 million, it was influence positively by the Lithuanian business units transition to an effective interest rate calculation in the amount of EUR 0.4 million.”

    Reports of AS LHV Group are available at https://investor.lhv.ee/en/reports.

    LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are AS LHV Pank and AS LHV Varahaldus. LHV employs about 350 people and over 131,000 customers use LHV’s banking services. Pension funds managed by LHV have 178,000 active customers.


    LHVGroup 2017-11 Investoritele ENG.pdf 

    #311546 Reply

    Nauris Treigys
    Keymaster

    The Supervisory Board of UAB Mokilizingas, belonging to the AS LHV Group consolidation group, has elected new Management Board members. Previous board members Erki Kilu, Mantas Jonuška and Jurgis Rubaževičius were recalled. New UAB Mokilizingas Management Board was elected for a 4-year period and consists of members Benas Pavlauskas, Jonė Virbickienė, Saulius Kuliešius and Raimondas Štreimikis.

    “Changes regarding the Management Board were made due to two reasons. Separating the Supervisory Board from executive management creates a two-level management system, in which the functions and responsibilities are clearly differentiated. The Management Board may concentrate fully on everyday operations. The elected board members are very capable to continue their activities in recent months in order to bring Mokilizingas to the next level in quality and growth paths,“ commented Madis Toomsalu, CEO of LHV Group.

    Benas Pavlauskas is a member of the Management Board of UAB Mokilizingas since June 2015 and the Chief Executive Officer of UAB Mokilizingas since January 2016. He was working as Chief Operating Officer of UAB Mokilizingas from June 2015 until January 2016.

    Jonė Virbickienė has been elected as a new member of the Management Board as well as the chairperson. UAB Mokilizingas is the first company where she is going to take part as the Management Board member, however, she is the deputy Chief Executive Officer of UAB Mokilizingas since July 2017 and the Chief Financial Officer of UAB Mokilizingas since October 2016. Before that Jonė Virbickienė worked as an Assistant Manager at UAB PriceWaterhouseCoopers up until September 2016.

    Saulius Kuliešius is a new member of the Management Board of UAB Mokilizingas. He is the deputy Chief Executive Officer of UAB Mokilizingas since July 2017 and Commerce manager of UAB Mokilizingas since May 2016. Up until May 2016 that he took a position as Sales department manager of UAB Mokilizingas. Addittionaly, Saulius Kuliešius is the General Manager of UAB Mokilizingas’ Latvian branch since September 2015.

    Raimondas Štreimikis is a new member of the Management Board of UAB Mokilizingas. He is the Chief Executive Officer of e-learning companies UAB E.mokykla and UAB Tavo mokykla since June 2016. Additionally, he was the Project Manager at UAB Žabolis ir partneriai since January 2015 as well as participating as the Management Board member of UAB ZIP7 since May 2016.

    Members of the Management Board of UAB Mokilizingas do not hold any shares of AS LHV Group.

    UAB Mokilizingas is the Lithuanian business unit of AS LHV Group in which LHV holds a 50% shareholding plus one share. It is a financial institution offering hire-purchase and consumer loan services in the Lithuanian market.
    LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are AS LHV Pank and AS LHV Varahaldus. LHV employs about 350 people and over 131,000 customers use LHV’s banking services. Pension funds managed by LHV have 178,000 customers.

    #312384 Reply

    Nauris Treigys
    Keymaster

    The Financial Conduct Authority in the United Kingdom has granted LHV Bank an approval to open a branch in the UK. LHV plans to register the branch in the coming weeks and start London operations in March.

    As the next step, LHV Bank will register the branch in the UK Companies House. The Estonian Financial Supervisory Authority approved the establishing of the UK branch in the end of last year.

    LHV Bank will open the branch in London in order to develop the bank’s financial service providers business line. Existence of the UK branch will allow LHV Bank to join Pound Payments Systems and provide financial intermediaries with real-time payments service in both euros and pounds. The role of LHV is to be the link between new generation fintech services and banking infrastructure.

    According to Erki Kilu, CEO of LHV Bank, servicing financial service providers has already evolved to an important part of the bank’s business. “We are an influencer bank. We strive to contribute to the development of financial services. During the last six years, we have seen a rapid growth in the payment services’ volume and more growth can be predicted, taking into account the impact of the European Payment Services Directive (PSD2), which entered into force this year, on the financial sector. In order to offer new solutions the financial intermediaries need banking services, that means us,” Erki Kilu commented.

    LHV Bank is already a direct member of the Euro Payments System and also participating in the Instant Payments System working group. LHV intends to open necessary accounts in the Bank of England and join the Pound Payments Systems at the earliest opportunity. LHV plans to start servicing financial intermediaries by the end of this year.

    “London has become one of the most important financial centres in which financial technology companies from both Europe and the rest of the world are represented. We already have a number of substantial and well-known international payment intermediaries as our clients and more will accrue in the future. We could also provide our payment services to banks, credit intermediaries and other companies,” said Erki Kilu.

    The UK branch will be managed by Andres Kitter, who serves as a member of the Management Board of LHV Bank and has so far overseen the servicing of financial service providers. “We are in the middle of recruiting suitable people for the London office and our aim is to open our London office in the middle of March. In addition to the branch manager, LHV will recruit customer service specialists and new employees covering compliance and money laundering prevention. We have already extended our software development team in Tallinn,” said Andres Kitter.

    LHV intends to start generating additional income with the new branch in the end of 2018, after the UK branch is established and joining Pound Payments System has taken place. A greater increase in revenue has been planned for following years after which the branch should become profitable. In 2018 the planned costs will mainly contain payment system accession costs and costs of developing the IT infrastructure.

    LHV will celebrate the opening of its’ UK branch on 19 March with a reception and panel discussion, themed “Will global cities prevail over countries?”, as a part of the Innovate Finance Global Summit.

    LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are AS LHV Pank and AS LHV Varahaldus. LHV employs about 350 people and over 131,000 customers use LHV’s banking services. Pension funds managed by LHV have about 178,000 customers.

    #312463 Reply

    Nauris Treigys
    Keymaster

    LHV’s Q4 was record-breaking
    AS LHV Group earned a consolidated net profit of EUR 6.8 million in the fourth quarter of 2017. The profit of the bank was EUR 3.9 million, asset management’s profit was 1.8 million and the Lithuanian business unit Mokilizingas earned EUR 1.4 million. LHV Group’s return on equity belonging to the shareholders was 19.4% in Q4.

    The consolidated profit of the group was EUR 1.3 million higher than in Q3 and EUR 1.1 million more than a year ago in Q4 of 2016. The profit for Q4 was positively influenced by the sales of the written-off portfolios of Mokilizingas, a decrease in write-downs and the transition to effective interest rate accounting, and negatively by revaluations arising from changes in exchange rates.

    During the quarter, the group’s consolidated loan portfolio grew by EUR 77 million (+12%; +EUR 49 million in Q3) and reached EUR 732 million. The consolidated deposits grew by a record EUR 269 million (+21%; +EUR 260 million in Q3) reaching EUR 1,537 million. Deposits related to payment intermediaries grew by EUR 152 million, mainly due to the account balances of a few large customers.

    The volume of funds managed by LHV grew by EUR 35 million in Q4 (+3%; EUR 33 million in Q3) and reached EUR 1,103 million.

    AS LHV Group posted yearly consolidated profit of EUR 22.2 million, which is EUR 2.3 million more than in 2016. The bank earned a profit of EUR 15.5 million, asset management EUR 5.8 million and the Lithuanian business unit EUR 1.9 million. The return on equity belonging to the LHV Group’s shareholders was 17.6% in 2017.

    Comments by Madis Toomsalu, CEO of LHV Group:
    “LHV’s fourth quarter was the strongest throughout time. Broad-based economic growth and the good work done by more than 360 people employed by LHV have driven a strong growth trend, and its impact is also carrying over to the coming quarters. By the end of the year, LHV is managing EUR 3.8 billion worth of customers’ assets.

    LHV’s strong underlying trends are also supported by the Estonian economic environment. Estonia has reached out of a long period of below potential performance and entered a period of strong economic growth. It is good to note that the outlook is improving for all trade partners of Estonia. The biggest concerns for Estonian enterprises are the labour availability and the rapid increase of labour expenses, therefore investments need to be increased in order to improve the efficiency. The continued record-low levels of financing costs and a stabile credit market create favourable conditions for that and enterprises are increasingly using the opportunity.

    The bank posted a profit at par with the previous quarter. Q4 was characterised by strong customer activity and a growth in loans and deposits. New customer numbers grew by 5,600 during the quarter, with the total number of customers exceeding 133,000.

    In addition to loans and deposits, new levels were reached in the assets of private banking, customer activity in payments, card transactions and acceptance of card transactions. Regarding the loan portfolio, loans to companies grew the most. The bank’s loan losses amounted to EUR 0.5 million in Q4. LHV’s focus continues to be on offering high-quality digital solutions, which during the quarter was characterized by rapid increase of the number of mobile bank logins, as well as the growing on numbers of customer agreements concluded by video identification and interfacing with LHV Connect.

    The pension funds managed by LHV Asset Management continued to make investments in Estonia – during the year the total volume of Estonia-oriented investment decisions amounted to EUR 170 million. This has ensured a relatively stable performance for LHV’s funds. The number of active 2nd-pillar customers decreased by 0.2 thousand in the quarter and remained at the level of 177,000.

    We are also happy with Mokilizingas, where the efforts made during the year to strengthen the team, increase efficiency and find new business volumes have started to bear fruit. The financing portfolio of Mokilizingas grew by EUR 12 million during the quarter (+31%), amounting to EUR 49 million at the end of the quarter. The credit quality of the portfolio remains stable.

    With regard to the 2017 financial plan, we surpassed the consolidated profit plan by EUR 364 thousand thanks to Mokilizingas achieving better results than expected, but remained below expectations by EUR 146 thousand with regard to shareholders’ equity, due to lower than expected interest income mainly from small financing products.

    LHV’s outlook for 2018 is strong. We pursue growth, while taking into account the risks and using capital efficiently. As a new area, we shall in 2018 focus on providing services to financial technology enterprises, with the launch of the UK branch being the main prerequisite thereof.”

    Income statement, EUR t Q4-2017 Q3-2017 12 months 2017 12 months 2016
    Net interest income 9 868 8 863 35 502 29 976
    Net fee and commission income 5 987 5 695 22 180 19 186
    Net gains from financial assets -421 74 979 1 309
    Other income 5 -36 -138 86
    Total revenue 15 439 14 596 58 523 50 558
    Staff costs -3 945 -3 508 -14 664 -12 976
    Office rent and expenses -499 -406 -1 716 -1 511
    IT expenses -570 -466 -1 889 -1 783
    Marketing expenses -1 356 -1 281 -4 861 -4 554
    Other operating expenses -2 117 -2 177 -8 815 -8 090
    Total operating expenses -8 486 -7 838 -31 945 -28 914
    EBIT 6 953 6 759 26 578 21 644
    Earnings before impairment losses 6 953 6 759 26 578 21 644
    Impairment losses on loans and advances 40 -1 261 -3 154 -1 480
    Income tax -201 -42 -1 248 -270
    Net profit for the reporting period from continued operations 6 791 5 456 22 176 19 894
    Profit/-loss from discontinued operations 0 0 0 0
    Net profit 6 791 5 456 22 176 19 894
    Profit attributable to non-controlling interest 1 107 429 2 575 2 078
    Profit attributable to share holders of the parent 5 684 4 420 19 601 17 816

    Balance sheet, EURt Dec 2017 Sept 2017 Dec 2016
    Cash and cash equivalents 961 212 696 392 306 500
    Financial assets 56 634 61 583 76 140
    Loans granted 740 169 663 941 543 382
    Loan impairments -8 125 -8 409 -5 741
    Receivables from customers 9 802 8 745 3 478
    Other assets 13 165 12 933 11 687
    Total assets 1 772 856 1 435 184 935 447
    Demand deposits 1 409 662 1 144 114 624 219
    Term deposits 127 477 124 036 152 793
    Loans received 6 000 16 779
    Loans received and deposits from customers 1 543 139 1 268 166 777 791
    Other liabilities 70 862 15 214 19 031
    Subordinated loans 30 900 30 900 30 900
    Total liabilities 1 644 902 1 314 279 827 723
    Equity 127 955 120 905 107 724
    Minority interest 7 894 6 787 5 319
    Total liabilities and equity 1 772 856 1 435 184 935 447

    Reports of AS LHV Group are available at https://investor.lhv.ee/en/reports.

    To present the results in Q4 interim report LHV will hold an investor meeting, that will take place on 6 February 6.00 p.m in LHV Tallinn client office (Tartu mnt 2, CityPlaza building, 1st floor). The presentation will be made in Estonian. All participants please register at https://fp.lhv.ee/academy/488.

    On 13 February LHV will disclose the 2018 Financial plan as well as a five year financial forecast. In order to present the plans to media, LHV will hold a press briefing on 13 February starting at 11 a.m at LHV Tallinn office. The presentation will be made in Estonian. To participate please let us know at priit.rum@lhv.ee.
    Attachments:
    LHV Group Interim Report 2017-Q4.pdf
    LHV Group 2017-Q4 Investor Presentation ENG.pdf
    Factbook ENG 2017-Q4.pdf

    #312542 Reply

    Nauris Treigys
    Keymaster

    At yesterday’s meeting AS LHV Group gave investors an overview of 2017 Q4 results. LHV was represented by Madis Toomsalu, CEO of LHV Group, Erki Kilu, Chairman of the Management Board of LHV Pank and Joel Kukemelk, Member of the Management board of LHV Varahaldus. LHV wishes to thank all participants.

    The video of the investor meeting is available at (in Estonian) LHV’s Youtube channel: https://youtu.be/su-O7vJ12Fs.

    Presentation slides can be found at https://investor.lhv.ee/assets/files/LHV_Group_Presentation_2017-10-EN.pdf.

    #312621 Reply

    Nauris Treigys
    Keymaster

    In January, the consolidated net profit of LHV Group amounted to EUR 2.5 million: of the major units the Bank earned EUR 1.8 million and Asset Management EUR 0.7 million. Net profit belonging to the group’s shareholders was EUR 2.2 million.

    Comments by Madis Toomsalu, CEO of LHV Group:
    “January was a strong start to the year, we are seeing all the positive trends of last year carrying over to this year. Growth continued in every business volume indicator. During the month, the group’s deposits grew by EUR 220 million, loans increased by EUR 8 million and the volume of II pillar pension funds grew by EUR 9 million. The rapid increase in deposits was mainly due to deposits of one payment intermediary in the amount of EUR 184 million.

    The number of bank customers grew by 2,100 in January. One of the reasons adding new customers has become easier is the removing of transaction amount restrictions regarding video identification, as video identification was equated with in-person identification in the end of last year. The number of asset management’s active customers declined by 400, this was caused primarily by our fund yields being lower than competitors’ in 2017. Taking into account the nervousness on the markets this year, our strategy, aimed at capital protection and Estonian OTC investments, is justifying itself.
    In January, Euromoney voted LHV Bank the best private banking service provider in Estonia. At the end of the month, the Financial Conduct Authority in the United Kingdom granted LHV Bank an approval to open a branch in the UK. LHV plans to register the branch in the coming weeks and start London operations in March. Another highlight of January was the appointment of Kadri Kiisel as the new CEO of AS LHV Finance.”
    Attachments:
    LHVGroup 2018-01 Investoritele ENG.pdf

    #312622 Reply

    Nauris Treigys
    Keymaster

    LHV Group is disclosing the financial plan for 2018, that forecasts the group’s income to increase by 20% and consolidated net profit to grow by 10%.

    During 2017 LHV Group achieved record levels in all its’ business volumes. During the year, LHV Bank deposits grew by EUR 760 million, loans by EUR 194 million, and the volume of funds managed by LHV Asset management by EUR 129 million, supported by pension funds growth. For this year, LHV forecasts a 25% increase of the loan portfolio and a 13% decrease of consolidated deposits. Funds managed by LHV are forecasted to grow by 15%. LHV Group’s pre-tax profit is planned to amount to EUR 28.2 million in 2018 (21% increase from 2017).

    Key figures FP2018 2017 ∆
    Loans 916 732 +25%
    Deposits 1344 1537* -13%
    Cost/income ratio (C/I) 52.0% 54.6% -2.6 pp
    ROE (attr. to owners) 16.7% 17.6% -0.9 pp
    Capital adequacy 16.9% 18.3% -1.4 pp
    * Includes deposits of payment intermediaries, expected to decrease by EUR 300 million.

    LHV has over 5,300 shareholders and over 900 bond investors. In order to provide investors with the most up-to-date and relevant information, last year, LHV Group started to disclose monthly results and financial plan.

    Comments by Madis Toomsalu, CEO of LHV Group:
    “One of the cornerstones of the Corporate Governance practices followed by LHV is the equal treatment of investors. That is why we have decided to disclose also a five-year financial forecast. Compiling such a forecast is not new for LHV, however it is the first time we will make it public.

    The keywords of the 2018 Financial plan are quality in continuing existing services and development of the new business line. The economic environment remains good, the underlying trends being broad based economic growth, rise in companies’ productivity and investments and also growing wages. The financial sector is healthy and mainly characterized by the increasing loan volumes and low overdue levels.

    In 2018, LHV is focusing on growing in every domain of our business, sticking to the principles of simplicity and modernity, when it comes to our products:

    We will continue perfecting e-channels, renewing our internet bank, improving the mobile bank app with many new functionalities and launching a new pension application to the market. With open banking in mind, we will continue developing our APIs. We will introduce an offering to younger clients and car insurance. We will join the real time euro payment system and prepare for joining the real-time pound payments system. We will form an on-site team in our UK office and begin servicing clients there.
    Deposits will grow at a pace on par with last year. The majority of deposits will be taken in from retail customers; somewhat less will come from companies. Regarding financial intermediaries, we see a deposit increase from different customers; however, a very high deposit balance of one particular payment provider makes us expect a decrease in the deposits of the business line as a whole. In 2018, we are broadening our list of sources for financing.
    Loans continue to grow in record speed. The biggest source of growth will be loans to companies, followed by small loans by our Lithuanian business unit Mokilizingas and home loans issued in Estonia. All other loan products will continue to grow. We will also start providing factoring services.
    Regarding our services to financial technology companies the focus remains on establishing a branch in United Kingdom, preparation to join the Pound payments system and beginning to service clients in London. We will concentrate on the following sectors: neo-banks, currency service providers and payment intermediaries.
    Regarding pension funds, we will introduce to market a new II pillar pension fund, which invests only in Estonia. In 2017, LHV pension funds made Estonia-oriented investment decisions in the sum of EUR 170 million and Estonia-related investments will continue to grow in the coming years. At the same time, we are not excluding any other investment opportunities, any region or economic sector. The goal remains to provide best possible yields for our customers.
    In 2018, the group has sufficient capitalization in order to finance growth, but preparations will be initiated in order to refinance subordinated bond issue in 2019 and raise new capital, needed for growth.”

    Long-term forecast – a five-year plan

    AS LHV Group discloses hereby the financial forecast for the coming five years. According to this forecast, the income of the group should grow on average 15% yearly, at the same time costs will grow 8% yearly. Based on the financial forecast LHV’s consolidated net profit would reach EUR 54.1 million in 2022.

    Key figures FP2022 FP2021 FP20220 FP2019 FP2018
    Pre-tax profit 63.6 53.9 45.7 35.1 28.2
    Loans 1510 1362 1240 1093 916
    Deposits 2154 1922 1714 1520 1344
    Cost/income ratio 41% 43% 45% 49% 52%
    ROE (attr.to owners) 19.7% 19.1% 17.3% 19.1% 16.7%
    Capital adequacy 20.7% 19.2% 17.8% 17.1% 16.9%
    * Business volumes shown in EUR million

    Comments by Madis Toomsalu, CEO of LHV Group:
    “One of the prerequisites of the five-year financial forecast is the persistence of the current economic environment. The choice not to forecast the turning of the economic cycle does not mean neglecting possible risks. Our credit decisions and different stress tests continuously take into account abrupt stress scenarios; likewise, we consider them when determining our capital buffers. Out of the other main prerequisites we can highlight significant growth of business volumes, accrual of income from the financial intermediaries business line, higher credit loss resulting from a conservative approach, rise of the Euribor according to market forecasts, the capitalization and depreciation of the sales expenses of Asset management, persistence of II pillar pension fund payments at today’s level and the decrease in pension fund administrative fees due to volume growth as set by regulations, persistence of our dividend policy and the effect of the banking tax.

    The items of the financial forecast, that potentially could differ from reality the most, are deposit volumes and income from servicing financial intermediaries. Additionally, the absolute level of interest income is partially dependent on changes of Euribor rates and in addition to economic conditions, the realization of credit losses could also depend on other reasons related to individual customers.

    We forecast that the consolidated pre-tax return on capital will reach at least 20% every forecasted year. The UK branch activation expenses as well as the impact of the banking tax will affect the 2018 net profit’s return on capital belonging to shareholders. According to the five-year forecast, the aim is to also move towards 20% ROE in terms of net profit attributable to the shareholders. The five-year forecast anticipates that both in 2019 and 2020 new capital shall be raised by issuing bonds.

    In conclusion, the long-term financial forecast is ambitious, but realistic. We can carry out the plan with the help of more than 360 people, working in LHV, this number is likely to rise during this period. I hope that also henceforth our people will be motivated by the passion to raise the importance of LHV, that is to say Estonian capital, in the local financial services market and equally to help along to the LHV’s breakthrough in new markets and business fields.”

    LHV Group will make changes to the 2018 Financial plan in case it becomes likely that the planned net profit will differ more than 10% compared to the financial plan. The five-year forecast will be updated at the beginning of 2019 or together with the changes to the 2018 Financial plan, if needed.

    In order to present the financial plans to media, LHV will hold a press briefing on 13 February starting at 11 a.m at LHV Tallinn office. The presentation will be broadcast live (in Estonian) on LHV’s Facebook page https://www.facebook.com/LHVPank/.
    Attachments:
    LHVGroup Financial plan 2018 ENG.pdf

    #312795 Reply

    Nauris Treigys
    Keymaster

    On 23 February 2018, AS LHV Group decided to increase the share capital of it’s subsidiary AS LHV Pank by 10,000,000 euros.

    Increasing the share capital has been foreseen in the capital plan in order to support the growth of the loan portfolio of AS LHV Pank. As a result, AS LHV Pank will issue 10,000,000 new shares with nominal value of 1 euro. The shares will be issued without premium and will be subscribed by AS LHV Group, the sole shareholder of the bank. AS LHV Group will pay for the shares with a monetary payment at the expense of free funds, the transaction is considered to be intragroup payment. The issued shares will give the right to receive dividends as soon as the increase of share capital has been registered in the Commercial register.

    #312848 Reply

    Nauris Treigys
    Keymaster

    The management board of AS LHV Group sent to the Supervisory Board the 2017 audited annual report of AS LHV Group and the Supervisory Board approved it on 23 February. Financial results remained unchanged compared to the preliminary disclosure published on 6 February 2018.

    AS LHV Group Consolitated Annual Report 2017 is attached to this announcement and will be made available on LHV homepage https://www.lhv.ee/en/for-investors/reports/.

    LHV Group’s pre-tax profit for 2017 amounted to EUR 23.4 million and net profit totalled EUR 22.2 million. Pre-tax profit is 16% more than a year before. Net interest income grew 18% and net fee income increased 16%. Financial income decreased by 25%. The Group’s net income was EUR 58.7 million and increased by 16% compared to the previous year. Operating expenses amounted to 31.9 million euros and increased by 10% over the year. The Group met the financial forecast published at the beginning of 2017.

    By the end of December, the total volume of the LHV’s consolidated loan portfolio less impairments amounted to EUR 732 million (2016: EUR 538 million). The volume of portfolio increased 36% in a year. In the loan portfolio, the majority is corporate loans that increased 34% in a year to EUR 510 million (2016: EUR 380 million). The portfolio of retail loans increased 41% in a year, amounting to EUR 230 million (2016: EUR 163 million). The volume of Group’s deposits increased 98% in a year and totalled EUR 1,537 million by the year-end (2016: EUR 777 million). The share of demand deposits of all deposits increased and reached 92% (2016: 80%). The volume of investment funds managed by LHV grew by EUR 129 million, amounting to EUR 1,103 million (2016: EUR 974 million) at the end of the year.

    By business units, in consolidated figures in 2017, AS LHV Pank earned a profit of EUR 15.5 (2016: 13.2) million, AS LHV Varahaldus earned EUR 5.8 (2016: 6.1) million and UAB Mokilizingas earned EUR 1.9 (2016: 1.9) million. LHV Group as a separate entity earned a profit of EUR 2.7 million (2016: a loss of EUR 1.3 million), due to the fact that the subsidiary LHV Varahaldus paid dividends to LHV Group.

    The management board of LHV Group proposes to the General Meeting of Shareholders to pay dividends EUR 0.16 per share for 2017 (in the total amount of EUR 4.123 million), transfer EUR 0.98 million to statutory reserve capital and transfer the profit for reporting period attributable to shareholders of the parent in the amount of EUR 14,5 million to retained earnings.

    The list of shareholders who are entitled to receive dividends will be established on 26 April 2018 at the end of the working day of the settlement system. As a result the date of change in the right to receive dividens (ex-date) will be 25 April 2018. From this date persons obtaining shares will not be entitled to dividends for the 2017 financial year. Dividends shall be disbursed to the shareholders on 27 April 2018.

    LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are AS LHV Pank and AS LHV Varahaldus. LHV employs over 360 people and over 135,000 customers use LHV’s banking services. Pension funds managed by LHV have over 176,000 active customers.

    Attachments:
    LHV Group Annual Report 2017.pdf

    #312850 Reply

    Nauris Treigys
    Keymaster

    On 27 February 2018, AS LHV Group decided according to the proposal by the management of its subsidiary company, AS LHV Varahaldus, to allocate the subsidiary’s profit for financial year 2017, which amounts EUR 5807 thousand, including to pay dividends in the net amount of EUR 4400 thousand. Dividend will be paid to the sole shareholder, AS LHV Group, on 1 March 2018. Dividend payment corresponds to the financial plan for 2018.

    #312905 Reply

    Nauris Treigys
    Keymaster

    On 28 February 2018, AS LHV Group decided according to the proposal by the management of its subsidiary company, AS LHV Pank, the allocation of the subsidiary’s profit for financial year 2017, which amounts to EUR 13,909 thousand (net profit attributable to owners of the parent). The decision was made to pay dividends in the net amount of EUR 2178 thousand. Dividend will be paid to the sole shareholder, AS LHV Group, on 1 March 2018. Dividend payment corresponds to the financial plan for 2018.

    #313235 Reply

    Nauris Treigys
    Keymaster

    In February, the consolidated net profit of LHV Group amounted to EUR 1.3 million: of the major units the Bank earned EUR 0.8 million and Asset Management EUR 0.5 million. Net profit attributed to the group’s shareholders was EUR 1.2 million.

    Comments by Madis Toomsalu, CEO of LHV Group:
    ” February was an average month for LHV. The number of bank customers grew by 1800, which, given the shorter months, is a good result. At the same time, the group’s profit in addition to the shorter month was affected by pension funds management fees decrease of 6% and by above average credit impairments due to changes in the model based impairment calculation according to IFRS. As said in past the new IFRS impairment calculation is more volatile. It is important, however, that LHV credit portfolio is strong, only some individual customers are under more thorough monitoring.

    Attachments:
    LHVGroup 2018-02 Investoresitlus EN.pdf

    #313318 Reply

    Nauris Treigys
    Keymaster

    The Management Board of AS LHV Group (hereinafter the “Group”) hereby calls the general meeting of the shareholders, to be held at 13:00 on 11 April 2018 (Tallinn time) at Hilton Hotel, “Ballroom” conference hall (Fr. R. Kreutzwaldi 23, Tallinn, second floor).

    Registration of participants will start at the venue of the meeting at 12:00. Registration will end at 12:50. We kindly ask all shareholders and representatives to arrive in a timely manner, taking into account the time required for registration.

    The list of shareholders entitled to participate at the general meeting will be established 7 (seven) days before the general meeting, i.e. as at 4 April 2018 COB of the settlement system.

    For registration, we kindly ask participants to submit the following documents:

    shareholders who are natural persons are required to submit their identity document; representatives must also submit a valid written authorisation document;
    legal representatives of shareholders who are legal persons are required to submit their identity document; authorised representatives must also submit a valid written authorisation document; If the legal person has not been registered in the Estonian commercial register, we kindly request submission of a valid extract of the register in which the legal person has been registered and under which the representative is authorised to represent the shareholder (legal authorisation). The extract must be prepared in English or translated into English by a sworn translator or authority equivalent to a sworn translator, be verified by a notary, and bear the Apostille.
    A shareholder must inform the Group of the appointment of a representative or withdrawal of the authorisation prior to the general meeting, by sending the corresponding digitally signed notice to the general meeting’s e-mail address lhv@lhv.ee or by delivering the notice in a format which can be reproduced in writing to the Group’s location at Tartu mnt 2, Tallinn 10145, first floor, on working days between 09:00 and 19:00. Should a shareholder wish to inform the Group of the appointment of a representative or withdrawal of the authorisation granted to a representative prior to the general meeting, the corresponding notice must have been delivered to and received by the Group at the latest by 23:59 on 9 April 2018. Rain Lõhmus, Chairman of the Supervisory Board of the Group, may be appointed as the authorised representative, if the shareholder so desires.

    The authorisation document form is available for the shareholder on the Group’s website at investor.lhv.ee.

    Pursuant to the resolution adopted by the Group’s Supervisory Board on 14 March 2018, the general meeting will have the following agenda, with the proposals of the Management Board and the Supervisory Board specified under the agenda items and with the Supervisory Board proposing to vote for all draft resolutions specified under the agenda items:

    Approval of the Annual Report 2017
    To approve the Annual Report 2017 of the Group, as presented to the general meeting.

    Profit allocation for 2017
    The profit attributable to the Group as the parent company of the consolidation group in the financial year 2017 amounts to EUR 14,500 thousand. To transfer EUR 980 thousand to the legal reserve. To approve the profit allocation proposal made by the Management Board and pay dividends in the net amount of 16 euro cents per share. The list of shareholders entitled to receive dividends will be established as at 26 April 2018 COB of the settlement system. Consequently, the day of change of the rights related to the shares (ex-dividend date) is set to 25 April 2018. From this day onwards, the person acquiring the shares will not have the right to receive dividends for the financial year 2017. Dividends shall be disbursed to the shareholders on 27 April 2018.

    Overview of the economic results for the first two months of 2018
    An overview provided by the Management Board to the shareholders on the economic results for the first two months of 2018.

    Overview of the business environment
    An overview provided by the Management Board on the business environment and the Group’s five-year financial forecast.

    Appointment of the auditor for the financial year 2018/2019
    To appoint AS PricewaterhouseCoopers (registry code: 10142876) as the auditor for the financial year 2018/2019, and to establish the procedure for remuneration of the auditor in accordance with the contract to be entered into with the auditor.

    Votes shall be cast by open ballot. All documents related to the annual general meeting of the Group (including the notice on calling the general meeting, the draft resolutions, the Group’s Annual Report 2017, report on the activities of the Supervisory Board in 2017 and assessment of the Annual Report, and other documents to be submitted to the general meeting) will be made available to the shareholders on the Group’s website investor.lhv.ee and at the Group’s location at Tartu mnt 2, Tallinn 10145, first floor, during working days from 09:00 to 19:00 until (including) the day of the general meeting.

    All shareholders shall have the right to receive from the Management Board information on the Group’s activities at the general meeting. The Management Board may refuse to give information, if there is reason to presume that this may cause significant damage to the interests of the Group or the companies incorporated in the Group. Where the Management Board refuses to give information, a shareholder may demand that the legality of the shareholder’s demand be decided by the general meeting or submit, within 2 (two) weeks after the refusal, a petition to a court in a proceeding on petition in order to obligate the Management Board to give information.

    Any questions regarding the agenda items of the general meeting should be addressed to the Group’s e-mail address lhv@lhv.ee until 23:59 on 9 April 2018.

    Shareholders, whose shares represent at least 1/20 (one-twentieth) of the share capital of the Group, may demand the inclusion of additional items on the agenda of the annual general meeting, if the corresponding request is filed in writing at least 15 (fifteen) days prior to the general meeting, i.e. at the latest by 23:59 on 27 March 2018, at the e-mail address: lhv@lhv.ee or to the Group’s location at Tartu mnt 2, Tallinn 10145.

    Shareholders, whose shares represent at least 1/20 (one-twentieth) of the share capital of the Group, may submit to the Group in writing a draft resolution on each agenda item, by posting the draft to the e-mail addresslhv@lhv.ee or to the Group’s location at Tartu mnt 2, Tallinn 10145. The draft must be submitted in electronic form or by e-mail so that it would be delivered to and received by the Group no later than 3 (three) days before the general meeting, preferably by 23:59 on 9 April 2018 at the latest.

    #313459 Reply

    Nauris Treigys
    Keymaster

    AS Inbank has made an offer to acquire 100% of the shares of UAB „Mokilizingas“ from its current shareholders AS LHV Group and UAB “Inovatyvūs prekybos sprendimai”.

    The sides will not disclose details of the offer as the supervisory boards of the companies will need to approve the agreement first.

    UAB „Mokilizingas“ belongs to the consolidation group of AS LHV Group. 50% + 1 share of the company belongs to LHV Group. Mokilizingas is a leading consumer finance services provider in Lithuania with the second largest market share of 40% in the hire-purchase segment. The company has in Lithuania over 2000 partners, approximately 250 thousand customers and over 100 thousand active contracts. In addition to Lihthuania, Mokilizingas also services strategic partners in Latvia.

    The possible transaction would not be considered a transaction between related persons.

    #314064 Reply

    Nauris Treigys
    Keymaster

    The annual general meeting of shareholders of AS LHV Group, held today in Tallinn Hilton Hotel „Ballroom“ hall (Fr. R. Kreutzwaldi St 23), approved the Annual Report, decided the dividend payment for 2017 and appointed an auditor for a new period.

    A total of 142 shareholders participated and were represented at the meeting, with their corresponding shares representing a total of 18,261,414 votes. This means 70,87% of the votes determined by shares were represented at the meeting.

    The notice on calling the annual general meeting was published in the stock exchange information system and on LHV website on 16 March. On the same date, the notice was printed in the Postimees daily newspaper.

    The annual general meeting of the shareholders of AS LHV Group resolved:

    1. Approval of the Annual Report 2017
    The general meeting unanimously resolved to approve the Annual Report 2017 of the Group, as presented to the general meeting.

    2. Profit allocation for 2017
    The profit attributable to the Group as the parent company of the consolidation group in the financial year 2017 amounted to EUR 14,500 thousand.
    The general meeting decided to transfer EUR 980 thousand to the legal reserve. The general meeting unanimously resolved to approve the profit allocation proposal made by the Management Board and pay dividends in the net amount of 16 euro cents per share.

    The list of shareholders entitled to receive dividends will be established as at 26 April 2018 COB of the settlement system. Consequently, the day of change of the rights related to the shares (ex-dividend date) is set to 25 April 2018. From this day onwards, the person acquiring the shares will not have the right to receive dividends for the financial year 2017. Dividends shall be disbursed to the shareholders on 27 April 2018.

    3. Overview of the economic results for the first two months of 2018
    The management provided the shareholders with an overview on the economic results for the first two months of 2018, that have been disclosed:

    January results
    February results
    4. Overview of the business environment
    The management gave an overview on the business environment and the Group’s five-year financial forecast.

    5. Appointment of the auditor for the financial year 2018/2019
    The general meeting unanimously resolved to appoint AS PricewaterhouseCoopers (registry code: 10142876) as the auditor for the financial year 2018/2019, and to establish the procedure for remuneration of the auditor in accordance with the contract to be entered into with the auditor.

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