Coop Pank had 189,000 clients at the end of the first quarter of 2024, up 7,000 in the quarter (+4%) and 34,000 in the year (+22%). There were 84,400 active clients at the bank, up 2,400 (+3%) during the quarter and 14,300 (+20%) throughout the year.
Amount of Deposits:
Coop Pank’s deposits dropped by 29 million euros (-2%), totaling 1.69 billion euros in the first quarter of 2024. Private customer deposits rose by 11 million euros, consisting of 3 million euros in term deposits and 8 million euros in demand deposits. Domestic business client deposits fell by fifteen million euros: term deposits fell by twenty-one million euros, while demand deposits rose by six million euros. There was a 24 million euro decline in deposits from other funding sources and the international deposit platform Raisin. Coop Pank’s deposits have grown by 181 million euros (+12%) compared to Q1 2023.Â
Term deposits now make over 70% of total deposits, up from 59% in a year comparison. The bank’s borrowing cost was 1.5% in the same period last year but 3.5% in Q1 2024.
Business Loans and Home Loans Portfolio:
Coop Pank’s net loan portfolio was 1.53 billion euros in Q12024, up 40 million euros (+3%). The portfolios for business and residential loans, as well as leasing, had the highest rise. The portfolio volumes of commercial loans climbed by 11 million euros (+2%), the portfolio volumes of leasing loans increased by 10 million euros (+7%), and the portfolio volumes of house loans increased by 20 million euros (+3%). Consumer financing portfolio shrank by 1 million euros (-1%). The entire loan portfolio of Coop Pank has increased by 184 million euros (+14%) in comparison to Q1 2023.
The percentage of past-due loans in Coop Pank’s portfolio rose from 2% to 2.4% in the first quarter of 2024. The rate of past-due loans in the portfolio was 1.8% one year ago.
Financial asset impairment costs for the first quarter of 2024 totaled 0.6 million euros, representing a 50% drop from the previous quarter and a 65% decrease from quarter one of 2023.
Net income for Coop Pank:
Coop Pank’s net income in the first quarter of 2024 was 20.2 million euros, up 3% annually and down 1% quarterly. Operating expenditures were 9 million euros in Q1; they went up 24% in the yearly comparison and down 5% in the quarterly comparison.
Coop Pank’s net profit in the first quarter of 2024 was 9.1 million euros, up 9% from the previous quarter and down 3% from the same period last year. The bank’s cost-to-income ratio was 47%, and its return on equity was 19.2% in the first quarter of 2024. Thirty-seven thousand one hundred people are shareholders in Coop Pank as of March 31, 2024.
Margus Rink’s Remarks:
“We are functioning in a situation where stagnation has replaced two years of recession, and ideally, from an annual viewpoint, we will witness the initial indications of the economy reverting to the growth phase. The 40 million euros Coop Pank’s loan portfolio grew each quarter, which must be considered a respectable result. We are also happy with the steady increase in the clientele.
The market assumption at the end of last year was that interest rates would reduce gradually this year. However, the beginning point of the interest rate decrease has now moved to the summer, and this year’s decline is expected to be considerably less. Banks’ interest revenue has peaked and is declining in such a setting. In addition, interest rates have peaked, and compared to a few months ago, deposit interest rates are now substantially lower. From then on, the only way for banks’ net interest income to increase is if they take on more business.
The loan portfolio’s quality has improved admirably during the past three years of recession. Due to resolving issues with a few corporate clients and the discharge of these loans’ discounts, we had a relatively low credit cost during the most recent quarter. While there has been a slight rise in the number of short-term borrowers in the home loan portfolio simultaneously, most of them manage to pay off their debt before the next installment is due.
In conclusion, the first quarter of this year saw extremely respectable profit and performance indicators thanks to the expansion of company volumes, the maintenance of high-interest rates, and the availability of cheap financing. We have sufficient deposits and robust capital to support loan requests from individuals and businesses, which would put Estonia’s economy back on a growth trajectory. Growth in the economy would immediately offset the state budget deficit and lessen the need for tax hikes and expenditure cuts.
| Income statement, in th. of euros | Q1 2024 | Q4 2023 | Q1 2023 |
| Net interest income | 19 082 | 20 594 | 18 372 |
| Net fee and commission income | 1 014 | 1 489 | 1 028 |
| Net other income | 125 | -1 666 | 261 |
| Total net income | 20 221 | 20 417 | 19 661 |
| Payroll expenses | -5 409 | -5 495 | -4 542 |
| Marketing expenses | -533 | -912 | -412 |
| Rental and office expenses, dear. Of tangible assets | -795 | -678 | -700 |
| IT expenses and debt. Of intangible assets | -1 405 | -1 363 | -1 155 |
| Other operating expenses | -1 286 | -1 498 | -788 |
| Total operating expenses | -9 427 | -9 948 | -7 596 |
| Net profit before impairment losses | 10 794 | 10 469 | 12 065 |
| Impairment costs on financial assets | -576 | -1 148 | -1 627 |
| Net profit before income tax | 10 218 | 9 322 | 10 438 |
| Income tax expenses | -1 080 | -935 | -1 063 |
| Net profit for the period | 9 138 | 8 386 | 9 375 |
| Â | Â | Â | Â |
| Earnings per share, eur | 0,09 | 0,08 | 0,09 |
| Diluted earnings per share, eur | 0,09 | 0,08 | 0,09 |
| Statement of financial position, in th. euros | 31.03.2024 | 31.12.2023 | 31.03.2023 |
| Cash and cash equivalents | 380 644 | 428 354 | 334 074 |
| Debt securities | 36 460 | 36 421 | 18 932 |
| Loans to customers | 1 531 038 | 1 490 873 | 1 346 822 |
| Other assets | 31 320 | 30 564 | 30 048 |
| Total assets | 1 979 461 | 1 986 212 | 1 729 876 |
| Customer deposits and loans received | 1 693 254 | 1 721 765 | 1 512 627 |
| Other liabilities | 27 698 | 28 436 | 20 599 |
| Subordinated debt | 63 239 | 50 187 | 38 101 |
| Total liabilities | 1 784 191 | 1 800 387 | 1 571 327 |
| Equity | 195 270 | 185 825 | 158 549 |
| Total liabilities and equity | 1 979 461 | 1 986 212 | 1 729 876 |
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