SEB Grupp published the economic results for Q1 2016

Today, SEB Grupp published the economic results for Q1 2016. Information about the results is available here: www.sebgroup.com/ir

Allan Parik, Chairman of the Management Board of SEB Pank, commented on the results of SEB units in Estonia, as follows:

The year has begun well for Estonia’s economy. The opinion of entrepreneurs regarding the economic situation has improved in the beginning of the year. Industrial enterprises, construction companies, and the tertiary sector are more optimistic than before. The demand of Estonia’s vital trading partners is increasing, which in turn increases the number of orders for industrial enterprises. Investments made with the support of European Union measures improve both Estonia’s infrastructure and provide employment to the currently partially inactive building sector.

People’s sense of economic confidence has somewhat declined in the first months of the year. People were worried about maintaining their jobs due to the major redundancies which took place at the beginning of the year. Notable unemployment growth is not expected this year, which is also confirmed by the expectation of entrepreneurs that the number of employees shall increase. Rapidly increased salaries and slow economic growth could still bring along certain reorganisations in the economy. The best time for changes is under conditions of high employment, because only in this way can we increase the additional value created within the Estonian economy as well as people’s income.

Private person assets grow faster than obligations

Household deposits continue to grow at the same pace and significantly exceed loan growth. Compared to the beginning of last year, the loan activity of private persons is slightly higher, but more moderate than in the second half of 2015. In Q1, SEB issued 32 per cent more home loans than in the same period last year.

When compared to other Baltic States, Estonia stands out with a relatively even increase in savings across all income groups. SEB has supported the popularisation of saving by bringing innovative products to market. For example, more than 80,000 SEB clients collect money in the operating deposit during daily card use, saving about EUR 10 million in the Digital Coin Jar every year.

Enterprises are becoming active again

Financing the investments of small and medium-sized enterprises increased in Q1 by 15 per cent when compared with the same period last year, which is a sign of improved confidence. Low interest rates, affordable energy prices, and better expectations for the economic environment are encouraging enterprises to begin new projects. For large enterprises in Estonia, SEB currently has ongoing financing projects valued at EUR 300 million.

This year, SEB and its clients have tested the option to perform all the required actions for establishing a company in the form of a web meeting, instead of visiting a branch. The testing is an introduction to creating a new remote channel, where in the future both private and business client will be able to communicate with the bank without leaving home, receiving a level of service that is comparable to what is received when visiting a branch. As many of the services, transactions, and communication are already taking place online, then launching the web meeting service is a logical direction for developing our channels.

On its dividends, SEB paid EUR 5 million in income tax to the state revenue

In Q1 2016, SEB Estonia paid dividends to its parent company in the sum of EUR 20 million, from which corporation tax was paid into state revenues in the sum of EUR 5 million. In Q1 2015, SEB Estonia paid dividends in the amount of EUR 10 million (corporation tax was EUR 2.18 million).

The increased dividend payment decreased the bank’s net profit for Q1. The units of SEB Estonia finished Q1 2016 with a profit of EUR 12.8 million. SEB finished Q1 2015 with a profit of EUR 19.2 million. In Q1, the operating profit of SEB amounted to EUR 31.8 million (EUR 33.2 million in Q1 2015) and its operating costs to EUR 14.8 million (EUR 14.6 million in Q1 2015). In Q1 2016, the bank decreased loan loss provisions by EUR 0.7 million (in the same period of 2015, the bank decreased the provisions by EUR 2.9 million).

For more information:

Kristi Jänes
Project Manager for Communication
Marketing and Communications Division
SEB

Tornimäe 2, 15010 Tallinn
Phone +372 665 5399
Mobile +372 5569 0616
E-mail kristi.janes@seb.ee
www.seb.ee

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