Signet Bank continues to implement its long-term strategy of providing high-quality services to high net worth and affluent clients as well as the businesses owned by such clients.
As of the end of H1 2019, 57% of the bank’s deposit base comes from clients residing in Latvia and other EU countries. The bank plans to further grow its business volumes in its target market – Latvia and other EU countries, with the main focus on the local market, which makes up 43% of the bank’s deposit base. The Latvian market provides excellent opportunities for growing business volumes, as increasing numbers of local businesses are looking for more comfortable banking relationships and better service quality. In H1 2019 the bank arranged lending transactions worth EUR 45.2 million, of which loans to local clients accounted for EUR 20.4 million. We have a range of interesting lending projects on the local market in the pipeline and plan to substantially increase local lending volumes in the second half of 2019 – both through arranging club deals and also growing the loans portfolio on the bank’s balance sheet.
Net interest reached EUR 1.6 million (+2% vs H1 2018), income from net fees was EUR 2.0 million (+28% vs H1 2018), administrative expenses – EUR 2.8 million (-6% vs H1 2018) and net profits – EUR 0.2 million (+145% vs H1 2018). Overall client assets under management and administration (“AUMA”) grew from EUR 400 million at the end of H1 2018 to EUR 828 million (+107% vs H1 2018). The Group continues to maintain a conservative risk profile – at end of H1 2019, its capital adequacy ratio was 28.9% (vs 31.1% at the end of 2018), while its liquidity coverage ratio was 436%. These results were driven by increased of interest income due to higher volumes of lending, a 48% increase in income from capital management fees and a 19% increase in income from structured finance fees resulting from a higher volume of AUMA and a larger volume of club deals arranged by the bank.
We continue to pay great attention to AML/CTF compliance issues, constantly enhancing internal controls to keep in line with the changing regulatory environment and best international practices. The Group continues to invest in IT and human resources in order to make sure its risk management and controls are adequate for its business model.
For Signet Bank, we see a clear opportunity to grow our private banking and investment banking business. Having access to substantial capital owned by our HNW clients, we are able not only to arrange loans from our balance sheet, but also to syndicate sizeable debt financing transactions with our clients, in the form of both loans and bond issuances.
The bank’s management is satisfied with the positive results achieved in H1 2019 and is optimistic about the rest of 2019. We believe the bank has an excellent offer for existing and potential clients, and we are enthusiastic and committed when it comes to realising our great potential in terms of growing our business volume and revenues in these interesting times.
Chairman of the Board
About Signet Bank
The Bank was established in 1992 under the name of Latvian Business Bank. Since 2013, Signet Bank’s strategy has been focused on serving wealthy individuals and their businesses, particularly managing clients’ capital and structuring investment projects. Signet Bank’s majority shareholders are a group of Latvian and international investors that includes SIA Hansalink, SIA Fin.lv and Signet Acquisition III.