2012-06-14
According to the audited data as of 1 January 2012, the assets of operating banks of the country amounted to LTL 79 billion and declined over the year by 3.3 per cent or LTL 2.7 billion (after excluding the factor of AB bankas SNORAS, the annual growth of assets would comprise 6.6 per cent or almost LTL 5 billion). After the years 2009 and 2010, when banks suffered losses, in 2011 banks earned the profit of LTL 1.1 billion (in 2010, they suffered the loss of LTL 276.2 million).
The profit earned last year was very close to the record profit of the banking sector earned during the economic upturn period in 2007. The main profit growth drivers last year were the growth of net interest income and lower expenses on specific provisions.
In 2011, five banks and five foreign bank branches reported profit, while other three banks and five foreign bank branches suffered losses. The operating result of banks – the profit before tax, impairment and provision expenses – in 2011, compared to 2010, remained basically unchanged and made up LTL 850.1 million.
The suspension of AB bankas SNORAS activities in 2011 had a significant impact on deposit dynamics. In November last year, a decline of deposits was recorded in the banking system, however, the domestic banking system proved to be well prepared to withstand stress situations. Banks had accumulated sufficient reserves of liquid assets and could use them, when necessary, to repay deposits.
Already in December the assets and deposits in operating banks increased. This was determined by the transfer of insurance compensations for the depositors of the bank in bankruptcy in the amount of LTL 4 billion to the banking system. Around 77 per cent of these funds were transferred to the accounts of individuals and enterprises in banks and only 23 per cent of them were paid in cash.
Over 2011, loans to bank customers contracted by LTL 4.3 billion or 7.4 per cent, however, the largest impact on these statistics was made by the already mentioned AB bankas SNORAS factor. After excluding this bank, the total loan portfolio last year remained almost unchanged over the year, declining by 0.2 per cent or LTL 108 million to LTL 54 billion.
Insurance compensations to AB bankas SNORAS depositors transferred to the banking system determined a significant rise of the banking system’s liquidity indicator. In December 2011, it increased by as much as 5.2 percentage points (to 44.05%) and was the highest in the last one and a half years (the liquidity ratio set by the Bank of Lithuania is 30%).
In 2011, despite the decline of 1.7 percentage points, the capital adequacy ratio of the banking system remained high and accounted for 13.92 per cent on 1 January 2012.
After the gradual intensification of bank activity in 2011, the shareholders’ equity increased by LTL 942 million. After the elimination of AB bankas SNORAS factor, the shareholders’ equity of operating banks increased by LTL 1.5 billion or 26.0 per cent and made up LTL 6.9 billion on 1 January 2012. The largest impact on the growth was made by the profit earned in 2011.
In 2011, the authorised capital of the banking system grew by LTL 90 million and made up LTL 4.3 billion on 1 January 2012.