Market announcement

Title

LHV Group results for May 2025

Message

May for LHV was characterised by the rapid growth of the loan portfolio.
Profitability was impacted by the ongoing decline in interest rates and the
partial reversal of previous impairments. LHV Group's consolidated loan
portfolio grew by EUR 104 million in May. At the same time, the total volume of
deposits decreased by EUR 34 million. The volume of funds managed by LHV
decreased by EUR 11 million over the month. In May, 6.7 million payments related
to financial intermediaries were made.

In May, AS LHV Group earned EUR 10.3 million in consolidated net profit. Among
the subsidiaries, AS LHV Pank earned a net profit of EUR 10.5 million, LHV Bank
Ltd earned a net profit of EUR 28 thousand, AS LHV Kindlustus earned a net
profit of EUR 339 thousand, and AS LHV Varahaldus earned a net profit of EUR
297 thousand. The return on equity attributable to the shareholders was 17.3% in
May.

The number of LHV Pank customers grew by 2,800 in May, exceeding the 470,000
mark. Loan growth was strong at EUR 83 million, of which EUR 51 million came
from corporate loans and EUR 32 million from private loans. The overall quality
of the loan porftolio remains good and a solution was found for one of the two
largest non-performing loans, which led to a reduction in previously recognised
provisions. The strong month was also reflected in deposits, as corporate
banking deposits decreased by less than expected against the backdrop of an
increase of EUR 88 million in retail banking deposits. The decline in interest
rates is reducing the bank's net interest income, as deposit interest rates are
falling more slowly than loan interest rates.

LHV Bank, which operates in the United Kingdom, launched the initial version of
its retail customer offer in May, that allows customers to use the bank app,
open an account, make payments, order a bank card, and securely deposit money.
The presentation of the offer and the marketing campaign were started, the costs
of which also affected the company's monthly profit. Work will continue on the
following products to further develop the offer. The Bank's loan portfolio grew
by EUR 21 million in May.

The stable revenue growth of LHV Kindlustus also continued in May. New insurance
contracts were concluded for an amount of EUR 3.15 million. As at the end of
May, there are 274,000 valid insurance contracts. Performance improved due to a
successful motor own damage insurance campaign. Compensation for loss events
amounted to EUR 2.2 million and 12,500 new claims were registered in May. The
profitability of Kindlustus has been improved by a very good loss ratio.

Since May was a strong month in the financial markets, the pension funds of LHV
continued to grow value for their customers. The larger funds managed by the LHV
Varahaldus, L and XL, increased by 1.2% and 2.3%, respectively, over the month.
LHV Pensionifond Indeks increased by 5.6% over the month. The net profit of LHV
Varahaldus exceeds the financial plan, while the volume of funds and the number
of customers are slightly below the planned level. In May, LHV Varahaldus
announced a plan to change the names of pension funds to make them clearer for
customers and to merge the green pension funds with other funds.

Since LHV Group issued AT1 bonds worth EUR 50 million in April, EUR 15 million
worth of AT1 bonds were called back in May. As a result of the share option
program, the share capital of LHV Group was increased by EUR 366,721.30. Share
acquisition transactions were also initiated in accordance with the resolution
of the shareholders' general meeting held in March. The financial plan stands.

The reports of AS LHV Group are available on the website at:
https://investor.lhv.ee/en/reports (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 LHV Pank, LHV Varahaldus, LHV
Kindlustus, and LHV Bank Limited. The Group employs over 1,150 people. As at the
end of May, LHV's banking services are being used by 471,000 customers, the
pension funds managed by LHV have 111,000 active customers, and LHV Kindlustus
protects a total of 176,000 customers. LHV Bank offers retail banking services
to private customers in the United Kingdom, loans to small and medium-sized
enterprises, and banking services to international fintech companies.


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