Börsiteade

Pealkiri

Unaudited financial results of LHV Group for Q4 and 12 months of 2024

Teade

The year-end was a successful one for LHV, supported by strong loan issue and
deposit taking. The company met the profit target set in the financial plan.

In 2024, AS LHV Group generated net revenue of 338.3 million euros, i.e., 11%
more than in the previous year, thanks to strong business growth. Annual net
interest income increased to 273.3 million euros (+8%) and net fee and
commission income to 60.3 million euros (+24%). Consolidated expenditure for
2024 totalled 146.9 million euros, i.e., 14% higher than the previous year. The
consolidated net profit of AS LHV Group in 2024 was 150.3 million euros, i.e.,
9.4 million euros more than in 2023 (+7%).

Of the subsidiaries, AS LHV Pank earned a total of 140.5 million euros in net
profit in 2024, UK Bank Limited 5.8 million euros, AS LHV Varahaldus 1.6 million
euros, and AS LHV Kindlustus 1.2 million euros.

By the end of 2024, the consolidated assets of LHV Group increased to 8.74
billion euros, growing by 23% year-on-year, i.e., 1.64 billion euros. In Q4, the
volume of assets increased by 12%.

The consolidated loan portfolio of LHV increased by 990 million euros to 4.55
billion euros (+28%) in 2024. In Q4, the loan portfolio increased by 10%, i.e.,
426 million euros. Corporate loans increased by 328 million euros over the
quarter and retail loans by 98 million euros.

The Group's consolidated deposits grew by 1.18 billion euros over the year to
6.91 billion euros (+21%). In Q4, deposits increased by 624 million euros, i.e.,
10%, while deposits of regular clients increased by 134 million euros.

The total volume of funds managed by LHV increased by 39 million euros to 1.56
billion euros (+3%) over the year. In the last quarter of the year, the volume
of funds increased by 37 million euros (+2%).

The number of processed payments related to clients that were financial
intermediaries amounted to 74.8 million payments in 2024 (+51% compared to 49.5
million payments in 2023). In Q4, 19.8 million such payments were made, i.e.,
6% more than in Q3.

In Q4 of 2024, AS LHV Group's consolidated net profit amounted to 36.3 million
euros, which is 1.6 million euros more than in Q3 (+5%). On a year-on-year
basis, quarterly profit increased by 11%. AS LHV Pank earned 34.8 million euros
in net profit in Q4. In the last quarter of the year, LHV Bank Ltd earned a net
profit of 640 thousand euros, AS LHV Varahaldus 509 thousand euros, and AS LHV
Kindlustus 68 thousand euros. The return on equity attributable to the
shareholders of the Group was 22% in Q4.

The Group's consolidated net income increased by 2% in Q4 compared to the
previous quarter of the year to 84.9 million euros. Net income was 1% higher
than last year. Net interest income was generated at 66.6 million euros, and net
fee and commission income at 17.3 million euros. Consolidated operating expenses
were 40.8 million euros in Q4, which is 14% higher than in Q3 and 13% higher
than a year earlier.


 Income statement, EUR thousand                        Q4-2024 Q3-2024 Q4-2023
------------------------------------------------------------------------------
    Net interest income                                 66 556  67 426  67 670
------------------------------------------------------------------------------
    Net fee and commission income                       17 324  14 630  14 264
------------------------------------------------------------------------------
    Net gains from financial assets                       -198     799     480
------------------------------------------------------------------------------
    Other income                                         1 190     354   1 243
------------------------------------------------------------------------------
    Result from insurance activities                        49     357     371
------------------------------------------------------------------------------
 Total revenue                                          84 921  83 566  84 029
------------------------------------------------------------------------------
    Staff costs                                        -22 831 -19 499 -17 765
------------------------------------------------------------------------------
    Office rent and expenses                              -715    -801    -872
------------------------------------------------------------------------------
    IT expenses                                         -4 270  -3 612  -4 067
------------------------------------------------------------------------------
    Marketing expenses                                  -2 086  -1 298  -1 117
------------------------------------------------------------------------------
    Other operating expenses                           -10 885 -10 702 -12 366
------------------------------------------------------------------------------
 Total operating expenses                              -40 786 -35 911 -36 187
------------------------------------------------------------------------------
 EBIT                                                   44 136  47 655  47 841
------------------------------------------------------------------------------
 Earnings before impairment losses                      44 136  47 655  47 841
------------------------------------------------------------------------------
    Impairment losses on loans and advances             -1 085  -7 277  -9 430
------------------------------------------------------------------------------
    Income tax                                          -6 733  -5 681  -5 643
------------------------------------------------------------------------------
 Net profit                                             36 318  34 698  32 768
------------------------------------------------------------------------------
    Profit attributable to non-controlling interest        566     312     231
------------------------------------------------------------------------------
    Profit attributable to share holders of the parent  35 752  34 386  32 537
------------------------------------------------------------------------------

------------------------------------------------------------------------------
    Profit attributable to non-controlling interest       0.11    0.11    0.10
------------------------------------------------------------------------------
    Profit attributable to share holders of the parent    0.11    0.10    0.10



 Balance sheet, EUR thousand                   Dec 2024  Sep 2024  Dec 2023
----------------------------------------------------------------------------
    Cash and cash equivalents                  3 818 305 3 376 016 3 119 394
----------------------------------------------------------------------------
    Financial assets                             309 804   259 933   340 341
----------------------------------------------------------------------------
    Loans granted                              4 591 906 4 168 778 3 591 517
----------------------------------------------------------------------------
    Loan impairments                             -39 813   -42 543   -29 725
----------------------------------------------------------------------------
    Receivables from customers                     5 367    10 598    49 505
----------------------------------------------------------------------------
    Other assets                                  50 742    47 567    54 559
----------------------------------------------------------------------------
 Total assets                                  8 736 311 7 820 348 7 125 590
----------------------------------------------------------------------------
       Demand deposits                         4 855 101 4 160 516 3 808 162
----------------------------------------------------------------------------
       Term deposits                           2 055 009 2 125 844 1 922 843
----------------------------------------------------------------------------
       Loans received                            927 686   679 550   563 634
----------------------------------------------------------------------------
    Loans received and deposits from customers 7 837 795 6 965 910 6 294 639
----------------------------------------------------------------------------
    Other liabilities                             93 601   108 605   147 934
----------------------------------------------------------------------------
    Subordinated loans                           126 257   106 079   126 652
----------------------------------------------------------------------------
 Total liabilities                             8 057 653 7 180 595 6 569 225
----------------------------------------------------------------------------
 Equity                                          678 657   639 754   556 365
----------------------------------------------------------------------------
    Minority interest                              8 571     8 006     7 937
----------------------------------------------------------------------------
 Total liabilities and equity                  8 736 311 7 820 348 7 125 590


LHV Group continued its rapid growth in 2024. The strong end to the year was
influenced by a good level of client activity and higher than previous fee and
commission income. The decline in interest income was mitigated by strong growth
in the loan portfolio. Thanks to the good quality of the portfolio and the
improvement in the macroeconomic situation, LHV reduced write-downs. The updated
financial plan was accurately fulfilled by the end of the year.

The number of clients of LHV Pank increased by 10,900 to 455 thousand clients in
Q4. Over the year, the number of the bank's clients increased by 38,000, i.e.,
more than 9%. At the end of the year, clients also actively used LHV's banking
services, and the decrease in interest income was offset by better fee and
commission income, especially from investment banking. As interest income
continues to be under pressure, the bank is paying attention to limiting costs
by increasing efficiency. In this regard, LHV Pank announced layoffs in
December, reducing the workforce by 44 people.

The loan issue intensified in the last months of the year and, in Q4, the loan
portfolio of LHV Pank increased by 300 million euros. The quality of the loan
portfolio has remained stronger than planned, and write-downs on loans were
reduced. The deposits of LHV Pank increased by 577 million euros in the last
quarter of the year, of which 180 million euros came from deposits of regular
clients and 450 million euros from financial intermediaries, and platform
deposits were reduced. The bank is still keeping the focus on growing deposits.
At the beginning of October, the bank also issued 250 million euros worth of
covered bonds.

At the beginning of December, The Banker magazine of the Financial Times
declared LHV the best bank of the year in Estonia. Furthermore, Q4 included a
review of several important cooperation projects: LHV will be the main sponsor
of both Estonian football and the biathlon in the coming years.

The loan portfolio of LHV Bank operating in the United Kingdom grew by more than
half for the second quarter in a row. The loan portfolio increased by 126
million euros, while another 119 million euros of loans have been approved but
not issued by the Credit Committee. The quality of the loan portfolio is
generally strong. The volume of the deposits of LHV Bank increased by 70 million
euros, with a total of nearly 11,600 depositors being involved. The volume of
payments by financial intermediaries rose to record levels at the end of the
year.

In December, LHV Bank opened a new mobile bank for its first clients, through
which private persons can open an account and make payments. Further, the offer
and app will continue to be improved, and their wider introduction to the market
will be held in order to attract deposits directly from retail clients.

By the end of the year, the number of active clients of LHV Varahaldus making
monthly contributions was 114,000. Nearly 14,000 of them submitted applications
for larger contributions to the II pillar. Seasonally, contributions to the
III pillar were actively made again. Operating income and expenses for the
quarter remained at the level of the previous quarter. The profit was affected
by a more modest financial income from the growth of the funds' own units than
before, but the financial plan still managed to be outpaced.

The stock markets had a strong quarter driven by tech stocks and the U.S.
market. The quarterly rate of return of the pension funds M and L managed by LHV
was 1.0% and 0.6%, respectively, while XL decreased by 1.4% against the
background of a weak December. The rate of return of the more conservative funds
XS and S is 0.8% and 1.2%, respectively. Pensionifond Indeks increased by 4.2%;
Pensionifond Roheline lost 5.7% in value over the quarter.

For LHV Kindlustus, strong sales results, but also seasonally increased loss
events, set the tone at the end of the year. The number of policies in force and
clients is in a stable growth trend. A good sales result was shown by most types
of insurance. Revenue from the insurance service continued to grow, while
operating expenses increased. Gross losses increased a little faster compared to
earned income. For the year as a whole, LHV Kindlustus earned 1.2 million from
net profit and, thus, outperformed the financial plan.

LHV Group's annual cost/income ratio turned out to be 43.4%, and return on
equity 24.5%. The Group's liquidity and capitalisation remain strong. In
November, LHV Group conducted a successful offering of subordinated bonds,
raising 20 million euros in capital from investors. LHV Group will publish the
2025 financial plan and five-year forecast on 13 February.

Comment by Madis Toomsalu, Chairman of the Management Board at LHV Group:
"The changes taking place in the world are probably the biggest in the last half
century. We are witnessing the growth of geopolitical ambitions, structural
changes in the economy, the decline of free trade, and the exponential growth of
technological development.

Despite the different directions, 2024 was a successful year for LHV. After the
supervisory exchange, we were able to restore the historically ambitious growth
in business volumes. With a strong growth of 1 billion euros, i.e., 28% of the
loan portfolio and a higher base interest rate, we achieved the highest business
volumes and financial results in history.

In Estonia, we have grown into the second largest bank in terms of corporate
loans. At the same time, the volume of home loans and the insurance business are
also growing rapidly. The number of the Estonian bank's clients increased by
38,000 and activity increased in all the important areas. In the United Kingdom,
the corporate loan portfolio already exceeded 300 million euros by the end of
the year, which is why we are increasing our long-term expectations. This is
also reflected in the mobile app launched at the end of the year."



To access the reports of AS LHV Group, please visit the website
at: https://investor.lhv.ee/en/reports/
(https://www.globenewswire.com/Tracker?data=WWsWT6Z_H69bR1pPHcC2JLnz6364pYSWtL9a
tNdqcfuGB2kO3k9VmoJk84AYtaH7GM1D8n3vhx1TigqbNRoTX7PSeBiDBSs1vQ_R2XhNcyGbi-
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aXaeaAF71EnOO7FWNO2swn3iBegijMeIY4eevzi47CmqM_ITXzCM84tKhvHTnpx__YmxyBtI6RnMU1Zf
Mit99otcxNk_5jC97W_PQW60fB1nQaykYiKo0c3AwWUe5rzaYq).

In order to present the financial results, LHV Group will organise an investor
meeting via the Zoom webinar platform. The virtual investor meeting will take
place on 11 February 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_UP-IqHxNSRSVeoKeUcTOfQ.

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 1,200 people. As at the
end of December, LHV's banking services are being used by nearly
460,000 clients, the pension funds managed by LHV have 114,000 active clients,
and LHV Kindlustus is protecting a total of 170,000 clients. LHV Bank Limited, a
subsidiary of the Group, holds a banking licence in the United Kingdom and
provides banking services to international financial technology companies, as
well as loans to small and medium-sized enterprises.


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