bnn.lv Latviski   bnn-news.com English   bnn-news.ru По-русски
Sunday 22.09.2019 | Name days: Maigurs, Mārica, Māris
LatviaLatvia

Swedbank: healthy demand for loans is returning to Latvia

FaceBook
Twitter
Draugiem
print
(No Ratings Yet)

Baltic news, News from Latvia, BNN.LV, BNN-NEWS.COM, BNN-NEWS.RUHealthy demand for loans has begun coming back to Latvia, says Swedbank Latvia board chairman Reinis Rubenis.

«Low rates, export growth and improvement of consumers’ mood are the main factors that affect loan services. Although amortization of previously issued loans continues on its way to conclusion, the volume of newly-issued loans continues increasing – healthy demand for loans is starting to come back. The speed of demand growth will depend on the level of optimism from businesses and society, as well as economic process,» said Rubenis.

He notes that the lack of income transparency remains a serious obstacle for more rapid development. This is why one important long-term goal relies heavily on contribution to economic development. «It is good that the initiative we have been supporting for a long time now will finally be realized in Latvia, namely the initiative to lift corporate income tax from reinvested profits. Amendments to the law ensure that corporate income tax is not necessary to be paid if profits are not divided into dividends. Estonia’s experience shows that this kind of practice improves balance of businesses and their ability to take loans,» mentions Rubenis.

He says that there is an increase in demand for loans among Latvia’s small and medium-sized companies. «We have financed a 30% larger segment of medium-sized companies. As for small companies, we issued 53% more loans to them in nine months of 2017 than we did in 2016. We have also noticed more demand for loans in the agriculture, trade, production, real estate and construction sectors,» said Rubenis.

He notes that export development also affects loan services. «Current trends show that finances of turnover funds is more topical to our clients than it was last year. We expect these trends to continue in future years. We also expect a bigger effect from EU funds,» added the head of Swedbank Latvia.

Rubenis also said that positive developments in the economy, low interest rates and the state support programme for families with children also serve as good stimulus for housing loans.

«Although the general mortgage loan portfolio does not grow, demand for new loans remains stable and positive. In average, the volume of issued loans grows by 20-25%. This year is no exception. It is worth mentioning here that actual demand is even higher, but this is not true for all. Most often this is associated with income that cannot be proven and insufficient savings for the first instalment. The first instalment matter can be resolved with the help from the state support programme. In practice we see that a wide audience requires support for housing purchases, this is why it is important to continue work on expanding the programme,» he says.

At the same time, Rubenis is positive about the situation in the economy – people not only spend more money nowadays or consider taking a loan to improve their quality of life, but also think more often of their future. Savings made on deposit accounts, long-term savings, pensions and insurance pillows all continue growing.

«In general, the amount of money people have in all forms of savings and deposits in Latvia continue growing. In the past 10 years, a major increase has been observed in other forms of financial deposits – accumulative life insurance, third-level pension and direct deposits in securities,» adds Rubenis.

At the same time, he emphasizes that although the volume of deposits continues growing, it is still important to consider the general savings level in society. Survey performed by Swedbank Finance Institute shows that in the event of a household losing all of its regular income sources (wage, pension, benefits, etc.), they would not last longer than a month.

Asset-wise, Swedbank is the largest bank in Latvia.

Ref: 224.109.109.2509


Leave a reply

Week in Lithuania: awards to Jew savers presented, majority in Seimas restored, Foreigner centre criticised

Last week, the top events in Lithuanian politics and business were awards being presented to people, who saved Jews, the restoration of a majority in the legislature and the EBRD bank to pulling out from Lithuania's Šiaulių Bankas.

BNN summary of the week: cut support; concert hall dreams; infection in Sigulda

Everyone will have to tighten their belts in the budget formation process – ministries and residents. Welfare Minister Ramona Petraviča announced plans to reduce unemployment benefit payment term from nine to eight months. She stressed that unemployment benefit is normally paid for four and a half months.

Competition Council permits sale of Bauskas Alus shares to CIDO Group

Latvia’s Competition Council has approved the sale of 100% of shares in SIA Bauskas Alus to CIDO Group under no special conditions. The deal is planned to be completed within a couple of months.

Rimšēvičs: banks have five billion in Bank of Latvia; country’s economy could benefit

Currently different commercial banks have roughly EUR 5 billion stored in the Bank of Latvia. This money could be «injected» into the country’s economy, as reported by the Latvian central bank’s governor Ilmārs Rimšēvičs.

EU confident new Russia-Ukraine gas deal coming, Ukraine critical

In long-term gas deal talks between Russia and Ukraine about Russian gas transit through Ukraine held in Brussels, the European Union has seen positive signs a new deal could be reached, while Ukraine has expressed readiness stop transit if needed.

Bank of Latvia downgrades GDP growth outlook to 2.5% for 2019

The Bank of Latvia has downgraded GDP growth outlook from 2.9% to 2.5% in 2019 and from 3.1% to 2.6% in 2020, journalists were told by the Bank of Latvia governor Ilmārs Rimšēvičs on 20 September.

August’s producer price level in industry down 0.1% in Latvia

Compared to July, the level of producer prices in Latvian industry dropped by 0.1 % in August 2019. Prices of products sold on the domestic market grew by 0.2 %, but prices of exported products reduced by 0.3 %.

Baltic Restaurants Latvia breached hygiene standards in Sigulda’s kindergartens

Catering service provider Baltic Restaurants Latvia did not follow personal hygiene standards and committed numerous violations for cleanliness and disinfection activities at kindergartens Ieviņa and Saulīte in Sigulda.

Riga Central Market becomes more accessible for disabled people

After taking into account complaints from residents, Riga Central Market’s Gastronomy Pavilion has been made more accessible for people with motor function disabilities and more convenient for sellers, said Prof. Baiba Rozentāle, chairperson of Riga City Council’s Social Affairs Committee.

Estonia in Atomic Agency’s management to look for small-state solutions

After Estonia’s first election to the Board of Governors of the International Atomic Energy Agency, its priorities in the body have been declared as development of technological solutions suitable for small countries for meeting climate objectives and the safe handling of radioactive waste.

Volume of imported petrol to Latvia down 6.7% in seven months

The volume of imported motor petrol to Latvia has declined 6.7% in the first seven months in 2019 when compared to the same period of 2018. The volume of imported diesel fuel has increased 0.1%.

Estonia criticises plan to link EU migrant relocation with financial penalties

As Italy is calling for the reshaping of the migration policy of the European Union, Estonian Interior Minister has voiced opposition to the plan and vowed not to take part in the first debate of the proposal about the centralised relocation of migrants.

RISEBA rector: when students «disappear» in the labour market and never return

The desire to become independent quickly and start earning money often outcompetes students’ desire to study, BNN was told by rector of Riga International School of Economics and Business Administration Irina Senņikova in a conversation about the unfinished education problem in Latvia.

Ryanair O’Leary’s option to earn EUR 99 million approved by 50.5% shareholders

In Europe’s largest airline Ryanair, shareholders have voted with 50.5% in favour of a new renumeration system for chief executive office Michael O’Leary. In case of very successful operations, it sets forth paying him 99 million euros in five years.

PVD: no more E. coli presence found at kindergartens in Sigulda

Investigation of the cause for E.coli spread in Sigulda has been performed to the maximum extent to prevent more infection cases, said Food and Veterinary Service’s director general Māris Balodis in an interview to Latvijas Radio on Friday, 20 September.

EU-South America trade deal unacceptable to Austria

The draft free trade agreement between the European Union and the largest trade bloc in South America, Mercosur, is set to be blocked by the Austrian government as legislators in Vienna believe it would have endangered rainforests and labour rights.

Weather to remain rainy and windy in Latvia

Cyclone activity will continue dictating weather conditions in Latvia on weekends. This means the sky will become clear only briefly, as reported by Latvian State Environment, Geology and Meteorology Centre.

Sigulda municipality turns to police over infection cases in kindergartens

Sigulda municipality has turned to State Police to investigate the link between last week’s uncovered intestinal infection cases, including four infection cases involving salmonella bacteria, as confirmed by the municipality.

Latvian Saeima supports tighter mutual cooperation with USA in rights protection

On Thursday, 19 September, Saeima supported in the second and final reading a legislative draft, approving the September 2004 agreement for tighter cooperation between the Republic of Latvia and the United States of America for protection of rights.

Candidate: FCMC team should learn to work substantially, not formally

The team of Latvia’s Finance and Capital Market Commission should learn to work substantially, not formally, said the candidate for the post of chief of FCMC and Citadele Bank board member Santa Purgaile at a press –conference on Thursday, 19 September.

Lithuanian analysts on Russia-Belarus unification plan: actions louder than words

The announcement by Belarus and Russia this week of their entering into an economic confederacy by 2022 did not go unnoticed in Vilnius, which is courting the idea of recharging its dusty relations with Minsk. Is it just the Slavic countries’ new attempt to fulfil the endeavour?

Russia holds traditional holy man, who sought to drive out Putin

A Siberian shaman, who was on his way to Moscow, to «banish» Russian President Vladimir Putin, has been detained, Russian police has stated.

Costs for delivery of printed press to be compensated in Latvia

On Thursday, 19 September, Latvia’s Saeima supported in the second and final reading amendments to the Postal Law, which provide delivery of printed press under subscription in 2020 under the same rules and conditions that are in force now.

Saeima says state of emergency in Riga’s waste management sector is justified

Latvia’s Saeima has approved the decision made by the Cabinet of Ministers on declaring a state of emergency in Riga’s waste management sector.

Lithuanian PM’s lymhoma treatment met with solidarity by Health Minister

Lithuanian Health Minister has shaved his head expressing solidarity with Prime Minister Saulius Skvernelis, who is being treated against cancer.