LHV Group unaudited financial results for Q1 2023


In Q1 of 2023, AS LHV Group earned EUR 33.1 million in net profit, i.e., EUR 8.7 million more compared to last quarter (+36%) and EUR 20.7 million more compared to yoy (+167%). The return on equity attributable to the shareholders of LHV Group was 30.4% in Q1.

Within the quarter, AS LHV Pank earned EUR 37.3 million in net profit. In Q1, AS LHV Varahaldus earned EUR 87 thousand euros in net profit. AS LHV Kindlustus generated a net loss of EUR 450 thousand and LHV UK Limited generated a net loss of EUR 2.5 million in the first quarter.

Consolidated income of the Group in Q1 of 2023 was EUR 68.4 million, which is 21% more than in the previous quarter. Out of the income, EUR 55.1 million was net interest income and EUR 11.9 million net fee and commission income. The operating expenses of the consolidation group made EUR 30.6 million in Q1, being 14% more compared to Q4 2022.


LHV Group’s consolidated assets made EUR 6.09 billion euros by the end of March. Over the quarter, the asset volume dropped by EUR 45 million, i.e., by 1%.

The Group’s consolidated deposits decreased by EUR 34 million, to EUR 4.87 billion in Q1 (-1%; -268 million euros in Q4 2022). The reason for the decrease in deposits was a decline in the deposits of financial intermediaries by nearly EUR 98 million, while the deposits of regular clients increased by EUR 64 million.
Compared to the previous quarter, the consolidated loan portfolio decreased by EUR 59 million, to EUR 3.15 billion (-2%; +114 million euros in Q4 2022). Corporate loans decreased by EUR 69 million and retail loans grew by EUR 10 million.
The total volume of funds managed by LHV increased by EUR 119 million, to EUR 1.45 billion (+9%; +66 million euros in Q4 2022).
The number of processed payments related to financial intermediaries amounted to 9.1 million in Q1 (+25% compared to 7.3 million payments in Q4 2022).

The increased interest income and high quality of the credit portfolio contributed to exceeding the profit target of LHV Group by EUR 11.9 million. The financial plan stands.

Income statement, EUR thousand Q1-2023 Q1-2022 3 months 2023 3 months 2022
   Net interest income 55 108 25 787 55 108 25 787
   Net fee and commission income 11 877 10 346 11 877 10 346
   Net gains from financial assets 1 385 -1 314 1 385 -1 314
   Other income 13 -35 13 -35
Total revenue 68 383 34 784 68 383 34 784
   Staff costs -15 667 -10 249 -15 667 -10 249
   Office rent and expenses -767 -522 -767 -522
   IT expenses -3 226 -1 649 -3 226 -1 649
   Marketing expenses -810 -957 -810 -957
   Other operating expenses -10 152 -5 487 -10 152 -5 487
Total operating expenses -30 622 -18 866 -30 622 -18 866
EBIT 37 761 15 919 37 761 15 919
Earnings before impairment losses 37 761 15 919 37 761 15 919
   Impairment losses on loans and advances 1 583 -735 1 583 -735
   Income tax -6 281 -2 801 -6 281 -2 801
Net profit 33 063 12 383 33 063 12 383
   Profit attributable to non-controlling interest 409 503 409 503
   Profit attributable to share holders of the parent 32 654 11 880 32 654 11 880

Balance sheet, EUR thousand Mar 2023 Dec 2022 Mar 2022
   Cash and cash equivalents 2 574 177 2 482 288 3 247 918
   Financial assets 297 012 373 584 475 843
   Loans granted 3 167 568 3 229 214 2 771 767
   Loan impairments -18 384 -20 642 -19 244
   Receivables from customers 19 813 21 019 6 531
   Other assets 50 353 49 539 33 604
Total assets 6 090 540 6 135 002 6 516 418
      Demand deposits 4 339 971 4 644 843 5 247 061
      Term deposits 526 928 255 672 163 314
      Loans received 539 807 586 254 546 215
   Loans received and deposits from customers 5 406 706 5 486 768 5 956 590
   Other liabilities 98 876 96 541 113 510
   Subordinated loans 131 070 130 843 110 374
Total liabilities 5 636 652 5 714 152 6 180 474
Equity 453 888 420 850 335 944
   Minority interest 7 009 7 908 6 787
Total liabilities and equity 6 090 540 6 135 002 6 516 418

For LHV, the beginning of the financial year of 2023 was characterised by an increase in interest income, but also by perceptible anxiety in economy. Although the aggregated loan and deposit volume remained on the same level with the previous quarter, the company foresees continuous growth in the future. During the quarter, LHV UK Limited started the issuing of loans in the United Kingdom.

The number of LHV Pank clients increased by 13,100 (+3%) in three months. In a year, the number of bank clients has risen by 53,000 (+16%). Also, the activity of clients is increasing. While we can notice a resurgence in loan demand after the depression at the beginning of the year, repayment of two larger loans still meant a shrinkage on the aggregated portfolio level. The loan portfolio quality is good, the share of overdue loans continues to be low, however we can see some increase in debts of consumer loans.

Over the quarter, the clients’ interest in term deposits grew. Several deposit rate hikes against the background of changes in the interest rate environment contributed to this.

At the beginning of the year, a new investment banking team joined the bank. The number of investing retail clients is still increasing – in January, the number of the popular Growth Account exceeded the 50,000 threshold.

Surveys conducted during the quarter demonstrate the high level of LHV’s service and the offered customer experience. In its banking sector service research, the survey company Dive has named LHV the bank with the best customer service in Estonia. In the net promoter score surveys, conducted by Kantar Emor and Rait Faktum Ariko, LHV achieved the best result among banks. Also, LHV Pank was elected the Dream Employer of Business Sector in February and CV-Online declared LHV the Top Employer in March. Both LHV Tartu as well as Pärnu branch were awarded the European Green Office certification in March.

LHV UK Limited started issuing loans in the United Kingdom and is making preparations for the transfer of business to the new bank. As of now, nearly 50 employees have moved from AS LHV Pank to the subsidiary in the United Kingdom. In March, sharing of the banking services’ business income with LHV UK Limited started as well.

For LHV Varahaldus, Q1 of 2023 was effective against a backdrop of stock market volatility. In addition to the rate of return, the volume of managed II pillar pension funds increased due to the compensation of II pillar contributions by the state in the meantime together with the average rate of return in January. The quarterly rate of return of the largest actively managed LHV pension funds M, L, and XL was 1.5%, 2.0%, and 2.3%, respectively. The unit values of pension funds Indeks and Roheline increased 4.3% and 5.0%, during the quarter. The profitability of Varahaldus in Q1 was affected by the income tax expense of EUR 0.5 million due to dividend payment.

LHV Kindlustus continued to increase business volumes and efficiency by all product lines. The collected premiums increased by 17% in Q1 and outperform the financial plan. As at the end of the quarter, the clients had 220 thousand valid insurance contracts. During the quarter, 13,800 new insurance contracts were concluded and 3735 loss events handled. Customer satisfaction with claims handling remains at a high level.

At the General Meeting, held in March, the Group decided to pay revenue from ownership for the previous financial year. Dividends of 4 cents per share were paid out to the shareholders on 12 April. The capitalisation of LHV Group is at the highest level in history (22.2%). The excellent level of investor relations is evidenced by the award of the best investor relations granted to LHV Group by the Nasdaq Baltic Stock Exchanges.

Comment by Madis Toomsalu, Chairman of the Management Board at LHV Group:
“The rapidly changing business environment requires the banks to adapt. Against the increased income, changes in the main risks and their good management must be borne in mind. For LHV, it was a strong quarter. The rise in interest rates together with a high-quality loan portfolio took the Group’s capitalisation to the highest level in history. The decrease in the loan volumes in Q1 was caused by the conservative view on economy and capital at the end of the last year. On the back of capitalisation growth, we expect further growth in lending volumes in both Estonia and the United Kingdom. We are also waiting for the decision of the supervision authorities of the United Kingdom on the banking licence. The global news concerning the increased risks of banks in the meantime meant answering additional questions by us and extra time.”


To access the reports of AS LHV Group, please visit the website at https://investor.lhv.ee/en/reports/.

In order to introduce the quarterly results, LHV Group will organise an investor meeting via the Zoom webinar environment. The virtual investor meeting will take place on 18 April, at 9:00, before the market opens. The presentation will be in Estonian. We kindly ask you to register at the following address: https://lhvbank.zoom.us/webinar/register/WN_z5PkhBZFSAyNbH3r2KndbA.

LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are LHV Pank, LHV Varahaldus, and LHV Kindlustus. The Group’s companies employ more than 920 people. As at the end of March, LHV’s banking services are being used by 391,000 clients, the pension funds managed by LHV have 130,000 active clients, and LHV Kindlustus is protecting a total of 155,000 clients. LHV’s UK branch offers banking infrastructure to 200 international financial services companies, via which LHV’s payment services reach clients around the world.


Priit Rum
LHV Communication Manager
Phone: +372 502 0786
Email: [email protected] 


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