Financial results of SEB: First signs of economic activity recovering

Today, the SEB Group published its financial results for the first nine months of 2024, information on which can be found here: https://sebgroup.com/ir

Allan Parik, Chairman of the Board of SEB Pank, commented on the results of the Estonian unit of SEB for the nine months as follows:

First signs of economic activity recovering

The summary of nine months shows first signs of economic activity recovering in Estonia. Despite the economic recession that has lasted for more than two years, the loan portfolio of SEB has continued growing across all customer groups. The increase in loans to private persons is driven by an increased interest towards home loans. In the first nine months of this year, SEB has granted 3,330 new home loans and the volume of new sales of home loans has increased by 27 per cent year-on-year.

The readiness of business customers to initiate new business projects remains modest, but despite that, SEB has supported launching more than 5,100 business plans in the first nine months of this year and the business loan portfolio has grown by 4.45% year-on-year.

Deposits grow, interest towards investing is high

Year-on-year, the volume of deposits of private persons has grown 6.2 per cent, while the liquidity of business customers is still under pressure. In total, deposits have grown by nearly 2 per cent. Interest towards investing is worth noting. The number of customers who have begun investing has grown as much as 54 per cent year-on-year. Robo-Advisor has already nearly 7,000 users, a thousand of whom began investing using this modern automatised tool in 2024. The micro-investments service launched five months ago also already has nearly 1,000 users.

SEB has paid 80 million euros into government revenues

In comparison to the first nine months of the previous year, the revenue of SEB grew by two per cent, in comparison to the second quarter of this year, revenue decreased by 5 per cent. The drop in revenue is caused by a decreasing interest rates and lowering service fees. The expenses of SEB have increased 12 per cent year-on-year, mainly due to investing into our employees and new services. We are actively recruiting new employees in product development and tech. During the year, SEB has recruited 98 new employees in different areas in Estonia. The high quality of the loan portfolio has enabled reducing loan loss provisions and as a result, the operating profit of SEB is nearly as high as it was a year ago. The profit of SEB was mainly reduced by income tax paid from increased dividend payments, due to which the profit of the first nine months of this year was 16.8 per cent lower year-on-year.

SEB Pank Grupp (‘the Group’) ended the first nine months of 2024 with a profit of 148.3 million euros (compared to 178.3 million euros in the first nine months of 2023). The operating income of the Group reached 268.2 million euros (263.2 million euros in the first nine months of 2023) and operating expenses 64.0 million euros (57.0 million euros in the first nine months of 2023). The Group reduced its net expected credit losses by 2.7 million euros (the respective amount was 1.2 million euros in the first nine months of 2023).  No additional contributions were made into the resolution fund (1.4 million euros were contributed in the first nine months of 2023). Income tax was calculated at 58.6 million euros (27.7 million euros in the first nine months of 2023). In the first nine months of 2024, the Group paid a total of 80 million euros of different taxes into government revenues, which is twice as much as was paid in the same period last year.