BlueOrange strengthens its position in Latvia's financial market: crediting has increased by 29%
March 02, 2020
In 2019, bank BlueOrange Bank successfully continued its operations in line with the Bank’s business strategy, strengthening its position in the Latvia’s financial market.
According to audited data, the year 2019 was closed with a profit of EUR 6 million, which meets the expected level. The Bank’s income during the reporting period amounted to EUR 22 million. The Bank's equity amounted to EUR 66 million. The Bank's total assets (incl. assets under management) have increased by 24% up to EUR 806 million as at the end of 2019.
At the end of 2019, the Bank's liquidity reached 84%. Other key financial performance indicators of the Bank were successful as well — capital adequacy 15.8%, return on capital (ROE) 9.3% and return on assets (ROA) 1.2%.
During 2019, the Bank continued developing one of its main business lines — servicing and crediting of companies and individuals in Latvia, which lead to increase in lending volumes by BlueOrange. At the end of the year the total credit portfolio amounted to EUR 250 million, which is a 29% increase compared to the previous year. Out of that, new loans were issued in 2019 for EUR 113 million, which allowed for 33% increase of lending income compared to the previous year. Of the loans issued during the reporting period, 81% were targeted at supporting companies in Latvia, thereby contributing to the growth of local companies, production, exports, creation of new jobs and overall growth of the economy of Latvia.
During the reporting period, the Bank continued to increase its client base in Latvia, the Baltic States and Europe, which accounted for 97% of the total client share at the end of the year. The number of corporate clients has increased particularly rapidly, including leading companies of various industries in Latvia.
In 2019, cooperation with a number of European fintech companies was successfully developed and expanded, attracting deposits from countries such as Germany, Austria, the Netherlands, and Spain. The mentioned deposits provide for substantial additional investments in the national economy of Latvia. The investments attracted by the Bank made it possible to use cheaper resources for crediting local businesses and provide funding to small and medium-sized enterprises in Latvia on more favourable terms, which in its turn has allowed businesses to reduce costs and release funds for further development.
BlueOrange is one of the few banks in the Baltic States, which along with classical lending actively promotes the involvement of corporate clients in the use of alternative funding and capital market instruments by encouraging new local companies to enter the Nasdaq Baltic exchange. In addition, during the last year, the Bank continued to strengthen its position in acquiring sources of alternative funding for corporate clients by organizing bond issues in the total amount of EUR 8.8 million. Meanwhile, the Bank continued successful cooperation with international partners through the participation in organising the issue of Eurobonds in the Baltic region for EUR 65 million.
Last year, the Bank actively worked in developing its investment services for individuals and enterprises. The agreements concluded with new international partners have allowed for expanding the range of investment products, offering even wider range of lucrative investment opportunities in more than 10.000 different investment funds.
During the reporting period, the Bank continued the development of the BlueOrange Open API under the PSD2 Directive. Similarly, the Bank continued its technological development by automating its internal business processes and expanding the functionality of internet banking, with a view to ensuring an increasingly convenient access to banking products and services for clients in remote settings and ensuring the highest security of financial transactions in the Internet environment.
Last year can be described as a year of test and major challenges in area of compliance for the entire financial sector, as well as for entrepreneurs and society as a whole. Therefore, in 2019, the Bank continued handling the matters of risk management and operational compliance as a top priority. The Bank continued improving its internal processes and information systems in the area of risk-management for the prevention of money laundering and terrorism financing and proliferation, meanwhile improving its client transaction monitoring and due diligence procedures.
The Bank actively engaged in activities of the Finance Latvia Association for the development of cooperation and dialogue with various governmental and non-governmental organisations in order to work together on important issues for Latvia for improved regulation of the financial sector and restoration of its reputation.
In 2020, BlueOrange, as a local capital bank, will continue to develop its support programme for small and medium-sized enterprises of Latvia, and as a bank of new technologies, will continue to provide convenient and safe online banking services to private individuals.
In demonstrating its social responsibility, the bank provides functional and technical support to the charity fund BeOpen. Over the past year, the fund has gathered donations in the total amount of 360 thousand EUR from both entrepreneurs and individuals. Thanks to the great support and responsiveness of donors, dozens of children with severe functional disabilities received support, and funding was provided for intensive rehabilitation courses in Latvia and abroad, procurement of assistive products, counselling, medical courses and operations that currently lack state funding.