Bigbank earns the biggest profit of last three years
Bigbank’s profit before provisions and income tax increased by 18% compared to the same period last year, i.e. from 18.9 million euros to 22.2 million euros, said Group CEO at Bigbank Martin Länts at today’s press conference. Bigbank’s loan portfolio has increased by 17%, i.e. from 443 million to 516 million euros, he added.
“The bank’s net profit is smaller than in previous years, but operating profit before write-downs has grown every year,” said Länts. “We’ve suffered some loan losses, but have achieved a strong result at the same time. Bigbank’s employees in all countries moved to home offices on 16 March. The launch of the new banking system Nest, which was completed last year, allowed all employees to work efficiently from home, including the employees of the call centre. The new banking system has allowed us to reduce our operating expenses, which decreased by approximately 1,6 million euros in comparison with the previous year. The loan loss has increased, as the present situation has created difficulties for many and we’ve provisioned for larger loan losses in the coming years.”
According to the Group CEO, people started renovating their homes during the emergency situation and renovation loans became popular instead of car loans. “We retargeted our marketing activities at the time, but car loans have recovered strongly by now,” said Länts.
“People may not have noticed it much, but we’ve been active on the business loan market in recent years. The increase in Bigbank’s corporate loan portfolio comprised 10% of the total increase in the corporate loan portfolio of the banking market. The corporate loans issued by Bigbank mostly exceed one million euros, but we also serve smaller companies,” added Länts. “We currently have eight active development projects in Estonia, which exceed 17 million euros in total. For example, the first vehicle we leased to an Estonian furniture manufacturer was a stacker. We’ve also started financing forest and agricultural land in Estonia.”
Länts said that Bigbank’s deposits are growing quickly as well. “The corona crisis started overnight for everyone and the main difference from the previous crisis was that back then, people kept consuming for a long time after the banking sector already knew that rainy days were coming. This time, people consciously postponed their outgoings and leave a safety buffer in an account or look for deposits to earn returns,” said Länts.
Bigbank AS (www.bigbank.ee) is an Estonian-owned special bank which focusses on consumer loans and fixed-term deposits. In addition to its operations in Estonia it has subsidiaries in Finland, Sweden, Latvia, Lithuania and Spain and offers its products as cross-border services in Austria, Germany and the Netherlands.
For further information please contact:
Martin Länts, Group CEO at Bigbank