Audited profit of the JSC "Aizkraukles banka" in 2001 — 4.2 million lats

March 18, 2002 / Banking

The audited operational results for Aizkraukles Bank in 2001 show a profit of 4.2 million lats. The profit level attained exceeded the planned amount (3.8 million Ls) and is higher than the bank’s provisional profit for last year (4.1 million Ls). During the reporting period AB’s assets rose by 46%, reaching 122.7 mill. lats.

AB’s management report emphasises that "in 2001 the bank has stabilised its growth rate. Solid foundations have already been laid by AB that will enable the bank to attain a qualitatively higher level of operational performance during the near future."

The audit of AB’s financial results for 2001 was carried out by the international auditing company "Andersen". According to the auditors’ report signed on 5th March 2002 "the financial statements provide true and clear overview of the financial situation of the bank as of 31 December 2001 ". The report of independent auditors does not contain any notes regarding the financial statements.

Last year AB was the most effective of all Latvian banks.

Last year the bank’s return on assets (ROA) reached 4.3% and according to this significant financial indicator AB is the most effective operator in the Latvian banking sector. During the first two months of this year AB’s return on assets has continued to grow and has reached 4.8%. In the first two month of the year 2002 AB has earned 954,000 lats, which by13% surpasses the earnings during the similar period last year.

Last year AB’s liquidity was 81%, and average return on equity (ROE) rose to 35.4%. AB’s earnings per share (EPS) in 2001 were 41.74 lats.

The amount of assets attracted at the end of the year reached 107.5 million Ls, which is by 34.2 million Ls or 47% more than in 2000.

The volume of credits issued by the AB is the fastest growing area.

The highest increase among AB operational indicators was achieved in the gross amount of the bank’s loans portfolio, which compared to 2000 rose by 11 million lats or 58%. 90% of the portfolio are loans issued to Latvian customers. The loans issued to individuals amount to 42%, but loans to legal entities — 58%.

Last year the amount of AB loans issued to legal entities reached 17.4 million lats rising by 6.2 million lats compared to 2000. However the volume of loans issued to individuals compared to the previous year rose by 4.8 million Ls reaching 12.6 million Ls.

According to the audited operational indicators in 2001, the volume of AB’s loans portfolio was 28.7 million lats. By the end of February this year the volume of loans issued by AB had reached 29.5 mill. Ls.

Evaluating the bank’s operation during the year 2001, Ernests Bernis, Chairman of the Board at AB, states that "last year AB strengthened its independence as a bank built on local capital with long experience in the international markets, putting forward new goals in the penetration of the Latvian market". He emphasised that "all major financial indicators of the Bank have exceeded those projected and this is the most important achievement of the last year". According to E. Bernis "Exceeding of the planned financial indicators has created the basis for the long-term development of the bank on a qualitatively higher level."

Increasing its market share introduces a new TM and expands its infrastructure.

Introduction of the bank’s new operational concept that was initiated at the end of 2001, and will be fully completed by the end of this year.

As a result, a new corporate style was created for the bank, whose ideological core is reflected by the trademark "AB.LV". AB has invested 180,000 lats in its development and introduction. 650,000 lats were invested in the new central office for client service that was opened this week in Riga at Elizabetes Str. 21a of which the majority was invested in the procurement of the most advanced security systems. AB plans to invest 2.8 million lats in the reconstruction of the bank’s main building on Elizabetes Str. 23 in 2002-2003. In order to fulfil the strategic goal of increasing its market share, AB is making substantial investments in both its client service infrastructure and most advanced banking technologies.

Olegs Fils,
Deputy Chairman of the Board of "Aizkraukles banka"