Artea bankas (ROE1L) Q3 2024 earnings summary

Executive summary

• Net profit for the first nine months of 2024 was €63.6 million, with a 15.4% return on equity and a cost-to-income ratio of 45.6%, reflecting strong profitability and efficiency.

• Loan portfolio grew 18% year-over-year to €3.43 billion, with strong gains in both corporate and private client segments.

• Market share increased across all business segments, supported by robust asset quality and a low cost of risk at 0.31%.

• Dividend payout policy revised to a minimum of 50% of prior year net earnings, with share buyback programs initiated.

• Two successful bond issues (€300 million and €50 million) strengthened capital and liquidity.

Financial highlights

• Q3 net profit was €20.6 million, with nine-month net profit at €63.6 million; total revenue rose 11% year-over-year to €54.5 million.

• Net interest income was €121.1 million for nine months (up 4% year-over-year), but decreased 2% quarter-on-quarter due to higher funding costs.

• Net fee and commission income surged 44% year-over-year to €21.0 million, with 9M growth of 44%, driven by acquisitions and renovation financing.

• Operating expenses increased 61% year-over-year due to business acquisitions, but fell 7% quarter-over-quarter as windfall tax effects subsided.

• Total assets reached €4.94 billion (+3% YTD), with deposits at €3.42 billion (+8% YTD).

Outlook and guidance

• Loan book targeted to reach €3.7 billion in 2025 and €4.1 billion by 2026, with a CAGR of about 8%.

• Cost-to-income ratio expected to remain below 47.5% and ROE above 15% in the medium term.

• Positive economic momentum in Lithuania expected to continue into 2025, with declining interest rates likely to stimulate further growth.

• No significant fiscal policy changes anticipated following recent parliamentary elections.

• Strengthened funding structure and capital base support ongoing growth and dividend commitments.