Riga, 2011-11-03 07:26 CET (GLOBE NEWSWIRE) -- In year 2011 the Mortgage and Land Bank of Latvia continues targeted implementation of the state aid programmes and demonstrates stable operational results. In the first nine months of year 2011 the Mortgage Bank has worked with 3.3 mln lats of unaudited profit in comparison with 35 mln lats in losses in the respective period in year 2010.
In the second half of year 2011 the Mortgage Bank recorded gradual growth, the capital adequacy and liquidity ratios of the bank being constantly high. Within the framework of transformation to a development institution, the Mortgage Bank proceeded with active corporate lending from the state aid programmes.
Implementation of State Aid Programmes
In the second half of year 2011 the range of the state aid programmes implemented by Mortgage Bank was expanded by new Micro-lending Programme financed from the funds of the Latvian and Swiss co-operation programme and state budget. Already one month after launching of the programme it had granted loans for 100 000 lats.
Absorption of other programmes’ funds also shows steady growth. As at October 25, 2011 the Programme for Improvement of Competitiveness of Businesses had granted 377 loans for 161.5 mln lats in total, the European Social Fund’s programme "Support to Self-employment and Business Start-ups" had financed 554 projects for 6.7 mln lats, whereas SME Growth Programme had granted loans for 18.5 mln lats. The sum total of the loans granted to support farmers exceeds 39 mln lats.
Operational Results
In the first nine months of year 2011 the Mortgage Bank’s profit before provisions and taxes amounted to 8.6 mln lats that, in comparison with the respective period last year, was 18% increase. In the first nine months of this year the income reached 18.2 mln lats that was by 24% more than in the same period in 2010, but profit amounted to 3.3 mln lats.
In the first nine months of year 2011 the total deposits increased by 3.5% attaining 371 mln lats, the number of new clients – legal entities increased by 5% that was by 25% more than in the respective period last year.
Capital Adequacy and Liquidity
The Mortgage Bank maintains constantly high capital adequacy and liquidity ratios that considerably exceed the statutory minimum defined in the Credit Institution Law. As at September 30, 2011 the capital adequacy ratio was 16.8% (minimum is 8%). Whereas liquidity ratio had increased even more and reached 79.3% as at September 30, 2011 (minimum is 30%).
The Mortgage Bank was established in 1993. Its priorities are support to small and medium enterprises and promotion of economic activity in all regions of Latvia. The Mortgage Bank offers state aid target programmes for various needs of entrepreneurs, like business investment loans, working capital loans as well as loans for starting a business.
Signe Eisaka
PR Officer of Mortgage Bank
signe.eisaka@hipo.lv
telephone: +371 67774159
www.hipo.lv