- The volume of loans and leases to companies continued to grow rapidly, increasing by 8% over the year
- Households and companies had deposits of over 11 billion euros in banks at the end of June
- The net profit of the banks was 89 million euros in the second quarter
The stock of loans and leases from banks to Estonian companies and private individuals was 6.4% larger in June than a year earlier at 16.5 billion euros. Growth accelerated in the loan and lease portfolio primarily because of loans to companies, which increased by 8% over the year.
In June, 230 million euros of long-term loans and leases were issued to companies, which is a similar amount to that of the preceding months. There was an increase of 18% in the loans and leases issued in June compared to the previous June. More loans went to companies in manufacturing and logistics in June than in the previous months.
Yearly growth in the portfolio of loans and leases to households has remained a little below 5% in the past half year. The largest share of loans to households was made up of housing loans, as 92 million euros of such loans were issued in June, 14% more than a year earlier. Having previously been relatively quick, growth in car leases slowed in June as sales of new cars were down on the previous two months.
The quality of the loan portfolio of the banks did not change, and the share of loans overdue by more than 60 days remained at 1.3%.
Households and companies had deposits of over 11 billion euros in banks for the first time in June, which was 7.5% more than a year earlier. The deposits of non-residents continued to shrink though.
The average interest rate on new housing loans rose slightly to 2.3% in June. This is the highest average interest rate on housing loans of recent years. The interest rate on corporate loans was the same as in the previous month at 2.5%.
Banks earned 89 million euros in net profit in the second quarter. Excluding dividends from subsidiaries and income tax paid, this is the biggest quarterly profit in recent years. Net interest income has particularly increased, primarily because interest expenses have declined.
Source: Bank of Estonia
Author: Jaak Tõrs, Head of the Financial Stability Department of Eesti Pank
Filed under: Banking, leasing, insurance |