Coop Pank increased its business volumes by 40% for the third consecutive year.
Coop Pank's loan portfolio reached EUR 460 million in 2019 having increased by
EUR 131 million or 40% over the year. Car leasing and business loans business
lines showed the highest growth, increasing their portfolios by 60% and 50%,
respectively. Home loan portfolio showed the 29% and consumer finance portfolio
25% annual growth. The market share of the bank's loans was 2.3% at the end of
2019, showing the annual increase by 0.6 pp.
The quality of the loan portfolio remained high. In 2019, the provisions made on
loan portfolios to account for potential future credit losses were made in sync
with the growth of the loan portfolio, i.e. 39% more than in 2018.
As at the end of 2019, Coop Pank's deposits totalled EUR 507 million, having
increased by EUR 122 million or 32% over the year. Term deposits increased by
34% and demand deposits by 26%. Considering the above, the bank's financing cost
increased from 0.8% to 1%. The market share of the bank's deposits grew from
2.2% to 2.6%.
In 2019, the profit of Coop Pank reached EUR 5.5 million, having grown by 16%
over the year. The annual increase of bank's income was 20%. The net interest
income served as the biggest contributor to the increase of income with its 23%
annual growth. Fee and commission income increased by 3% year on year. The
annual increase of bank's operating expenses was 20%. The biggest impact here
was the increase in IT expense, which grew by 53% year on year, as well as by
payroll expense with the 21% increase.
The bank's return on equity was at 10% and the cost-to-income ratio remained at
69%.
Results for Q4
The fourth quarter of 2019 was record-breaking for Coop Pank in terms of both
number of customers and growth in business volumes. The number of clients
increased by 7,500 over the quarter, reaching 63,800 customers, the bank's net
loan portfolio increased by EUR 42 million reaching EUR 460 million, and the
volume of deposits increased by EUR 29 million, reaching the total of EUR 507
million.
In Q4 of 2019 the bank earned the net profit of EUR 1.58 million.
Margus Rink, Chairman of the Management Board of Coop Pank, comments the
results:
?2019 was a successful year for Coop Pank, we met all the set goals. For the
third year in a row, we were able to increase our business volumes by 40% while
increasing our profits. The results show that the distinctive strategy developed
three years ago has proved successful.
The growth of the number of Coop Pank clients has accelerated year by year. At
the end of 2019, the bank's customer base reached 63,800, having increased by
18,700 or 41% over the year (in comparison, the growth of 2018 was +9,000 and
+4600 in 2017). The number of private clients increased by 17,100 in 2019 and
the number of business customers by 1,600.
Last year's most significant updates in client value proposition were the
instant interbank payments, the opportunity to earn up to 1% pa on current
account balances for private clients and up to 0.25% pa on demand deposits for
corporate clients.
In cooperation with Coop, Estonia's largest retail chain, Coop Pank launched an
innovative cash deposit service for retail and corporate customers at Coop's
cash desks last summer. Bank customers can now make cash deposits and
withdrawals at more than 300 Coop stores across Estonia. In November, we
upgraded Coop Pank's debit card customers to the highest level of Coop's loyalty
programme, offering the best prices and earning 10% extra bonus points on
purchases when paying with bank's debit card at Coop stores.
In the autumn, we started offering car leasing at Coop stores, allowing the
clients to familiarize themselves with new passenger car models and leasing
terms, and immediately submit a pre-established leasing application.
In August 2019, we founded Coop Kindlustusmaakler (insurance broker) for
providing our home loan and leasing clients with the insurance solutions that
best suit their needs.
To support the growth strategy of Coop Pank, the bank issued subordinated bonds
worth EUR 2 million to LHV Pension Funds. In June the shareholders decided to
increase bank's share capital by EUR 4 million. During the initial public
offering of Coop Pank shares in last November the bank raised EUR 31 million and
on 10 December the shares of the bank were listed on the Nasdaq Tallinn Stock
Exchange.
As at 31.12.2019, Coop Pank has 11,273 shareholders. The number of shareholders,
compared to the participants in the bank's initial public offering, has
increased by 421.
We want to be close to our customers, to provide innovative and very distinctive
banking products and services. We will continue to implement a differentiated
strategy based on the integration of banking and retailing, and work to deliver
the promises to our shareholders for 2020-2022."
Income statement, EUR thousand Q4 2019 2019 Q4 2018 2018
-------------------------------------------------------------------------------
Net interest income 5 819 20 689 4 983 16 779
Net fee and commission income 675 2 372 463 2 302
Other net income 262 658 125 687
-------------------------------------------------------------------------------
Total net income 6 756 23 719 5 571 19 768
-------------------------------------------------------------------------------
Payroll expense -2 710 -9 880 -2 131 -8 177
Marketing expense -317 -1 006 -268 -1 122
IT expense and depreciation of intangible
assets -444 -1 501 -272 -982
Rental and office expense, depreciation of
property, plant and equipment -550 -1 931 -459 -1 673
Other operating expense -614 -1 943 -463 -1 647
-------------------------------------------------------------------------------
Total operating expense -4 635 -16 261 -3 593 -13 601
-------------------------------------------------------------------------------
Net profit before impairment losses on loans
and advances 2 121 7 458 1 978 6 167
Impairment losses on loans and advances -538 -1 931 -313 -1 392
Profit/loss before income tax 1 583 5 527 1 665 4 775
Income tax 0 0 -22 -22
-------------------------------------------------------------------------------
Net profit for the reporting period 1 583 5 527 1 643 4 753
-------------------------------------------------------------------------------
Basic and diluted earnings per share 0,02 0,09 0,03 0,08
Balance sheet, EUR thousand 31.12.2019 31.12.2018
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Cash and cash equivalents 122 295 88 030
Debt securities 4 061 9 130
Loans to customers 460 460 328 723
Other assets 24 486 20 395
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Total assets 611 302 446 278
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Customer deposits and loans received 506 531 385 118
Other liabilities 8 356 6 971
Subordinated debt 7 064 5 026
-------------------------------------------------------------------------
Total liabilities 521 951 397 115
-------------------------------------------------------------------------
Shareholder's equity 89 351 49 163
-------------------------------------------------------------------------
Total liabilities and equity 611 302 446 278
-------------------------------------------------------------------------
Coop Pank reports are available at https://www.cooppank.ee/en/reporting
Coop Pank will hold an Investor Webinar to introduce the results of the year
2019. Webinar is scheduled on 11(th) of February 2020 at 10 am (EET). The
webinar will be held in Estonian. To join the webinar, you need to register in
advance via following link:
https://attendee.gotowebinar.com/register/2435602278496533004
(https://www.globenewswire.com/Tracker?data=uik7CwAe1jeMZmnI8c67vsS8jyBT7_lVCnTd
gUaodBGhfzDpOIiSsaYpPI92k-64-sGI3pEvcoR19Hr9I-
_gmFF77WQTF2NKnOqK5ktcHNphGeoqU4z753Aqt5Itoc2nHBTwgFIxt3qIx7oi76ys1waoC_mXkEUxC7
ZyONDnsaMjvVJPnx6_K64n84LdcpWgkI9tdO7YdZXFVIwFyzHR-Q==)
The webinar will be recorded and available online for everyone on Coop Pank
webpage www.cooppank.ee
(https://www.globenewswire.com/Tracker?data=ysaYE2aduEcKrKAVh7DYM6LiE28UTJqD7xkd
SPeY2t-8glSNNf3zmGgGz59--m-ZGdW8mZfR_aEVv-L5dz38qQ==) and Nasdaq Baltic
youtube.com account.
Coop Pank, based on Estonian capital, is one of the five universal banks
operating in Estonia. The number of clients using Coop Pank for their daily
banking reached 65,700. Coop Pank aims to put the synergy generated by the
interaction of retail business and banking to good use and to bring everyday
banking services closer to people's homes. The strategic shareholder of the bank
is the domestic retail chain Coop Eesti, comprising of 340 stores.
Additional information:
Kerli Lõhmus
CFO
Phone: +372 669 0902
E-mail: kerli.lohmus@cooppank.ee (mailto:kerli.lohmus@cooppank.ee)
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