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LHV Group results in October 2020

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In October, AS LHV Group earned EUR 2.6 million in net profit. AS LHV Pank
earned EUR 2.9 million in net profit, and the net profit of AS LHV Varahaldus
was EUR 0.2 million.

The business volumes and revenues have continued to increase. The biggest impact
came from finalising the acquisition of the Danske Bank corporate and local
government portfolio, which led to increased interest income; however, the
registration of collateral and loan impairments caused higher one-off expenses.
Private loans continued rapid growth and more than 5000 new clients joined the
bank. Also, the number of pension fund clients kept growing. Altogether, EUR
1.4 million of new loan impairments were made, half of which originated from the
Danske portfolio, with the other half related to forward-looking allowances of
single clients.

In October, we launched green loans for businesses to facilitate informed
investments of clients in more energy-efficient solutions. Additionally, the
loan product designed for apartment associations, presented at the beginning of
the month, has established itself well, having already been used by several
apartment associations for investments.

Last month we disclosed our target to create a new bank to replace the UK
branch, in order to better differentiate the offer of LHV banking services in
Estonia and to international payment intermediaries. We are now starting the
process. We also announced that in a year, we are going to open a client office
in Pärnu, which will enable us to provide convenient services to all clients in
the Pärnu region.

An important event in October was the decision of the Supreme Court about the II
pension pillar reform and announcement of the legislative amendment. Although
the reform will not resolve the substantial bottlenecks of the pension system,
those saving for a pension will have an opportunity to decide on the future of
their funded pension the following year. LHV is fully prepared for the change.
We want to offer our clients a possibility to make an informed decision and
provide them with a range of pension funds with the best return to save for the
future. At the same time, we are also in the middle of creating a suitable
pension investment account for pension-savers. Only 1.2% of LHV's pension
clients used the opportunity in October to suspend pension contributions.

The volume of LHV deposits grew by EUR 119 million, to EUR 3.33 billion in
October. The consolidated loan portfolio increased by EUR 279 million, to EUR
2.13 billion. The finalisation of the acquisition of the Danske Pank loan
portfolio increased the loan portfolio by EUR 254 million. The funds managed by
LHV did not change in October.

Compared to the financial plan updated in October, the cumulative net profit is
EUR 0.6 million less than planned.

AS LHV Group reports are available at: 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 and LHV Varahaldus. LHV
employs over 500 people. LHV's banking services are used by more than 240,000
clients, and pension funds managed by LHV have more than 184,000 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: [email protected] (mailto:[email protected])