LHV Group (LHV1T) Q2 2024 earnings summary

Executive summary

• Q2 2024 net profit was €38.6m, down €2.1m from Q1 but up €3.0m year-over-year, with business volumes and profitability exceeding the financial plan by €16.2m.

• Loan portfolio grew by €246m (+7% QoQ, +20% YoY), and customer numbers increased by 5,400 in Q2 2024.

• Net interest income rose 2% QoQ and 12% YoY; net service fee income up 5% QoQ and 32% YoY.

• Operating expenses increased by €2.1m QoQ and €4.5m YoY; loan and bond provisions rose to €5.0m.

• Deposits from regular customers increased, while platform and intermediary deposits were deliberately reduced.

Financial highlights

• Net profit: €38.6m in Q2 2024 (down €2.1m QoQ, up €3.0m YoY); net income: €87.3m (+€1.9m QoQ, +€12.4m YoY).

• Net interest income €70.4m (+€1.5m QoQ), net fee and commission income €16.3m (+€0.7m QoQ).

• Operating expenses €37.6m (+6% QoQ, +14% YoY); loan and bond provisions €5.0m.

• Loans portfolio €3.89bn (+€246m QoQ), deposits €5.78bn (-€150m QoQ).

• Liquidity coverage ratio 215%, net stable funding ratio 163%, loans to deposits ratio 65%.

Outlook and guidance

• All business lines are on track to meet 2024 financial targets, with profitability and business volumes ahead of plan.

• Continued focus on growing the loan portfolio and regular customer deposits.

• Emphasis on maintaining loan portfolio quality amid rapid growth and negative GDP environment.

• Development of new retail banking products and digital channels ongoing, with launches planned for late 2024 and early 2025.