AS LHV Group decided to commence operations to establish a bank in the United
Kingdom to clearly separate AS LHV Pank's current business activities in Estonia
and in the United Kingdom. Until now, LHV has operated in the UK through a
branch.
Separating the business activities allows for better compliance with regulatory
and supervisory requirements. Moving forward AS LHV Pank will focus on serving
Estonian customers and UK's bank shall provide banking services to the
international payment intermediaries. A clear separation between two businesses
will enable to better highlight the financial results and the value proposition
of the new bank for investors. The bank will be established in the United
Kingdom as a 100% subsidiary of AS LHV Group. The subsidiary will be established
in the near future, followed by staffing, capitalisation and application for a
credit institution license next year.
AS LHV Pank has been operating in the United Kingdom since the beginning of
2018, when the bank received a license to establish a UK branch. The new bank
will be based on the existing branch and its founding will not bring any changes
to the existing customers.
Today, AS LHV Pank has around 130 payment intermediary customers, that in turn
service over 10 million end customers worldwide. Amongst others the customers
include TransferWise, Coinbase, Trustly, Paysafe, Airwallex and TransferGo. The
bank provides payment infrastructure to leading fintech companies, all of them
characterised by advanced digital solutions, international reach and the pivotal
role of payments in their services. A growing number of LHV's customers also
come from the field of e-commerce and FX.
For payment intermediaries, AS LHV Pank predominantly offers settlement services
such as accounts, payments, card payments, currency conversion and other similar
services. As a direct member of both instant euro and pound payment settlement
systems, AS LHV Pank is in a unique position to offer customers real-time
payments in both major currencies in Europe. The services are offered to the
clients through a fast and functional Application Programming Interface LHV
Connect. LHV's payment intermediary customers make more than 13 million payments
a year and have an aggregate account balance of over EUR 500 million. AS LHV
Pank earns approximately EUR 7 million in fee income per year from these
services, and according to the newly updated financial plan, servicing the
segment will generate approximately EUR 4.8 million in net profit this year.
LHV Group is the largest domestic financial group and capital provider in
Estonia. LHV Group's key subsidiaries are LHV Pank and LHV Varahaldus. LHV
employs over 490 people. LHV's banking services are used by more than 235,000
clients, and pension funds managed by LHV have more than 183,000 active clients.
LHV's UK branch offers banking infrastructure to 130 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: priit.rum@lhv.ee (mailto:priit.rum@lhv.ee)
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