In Q1, NLB observed an increase in net banking income of 3% YoY and an increase in net income of 0.4%.
| wdt_ID | Key Indicators | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | Q1 2019 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 1 | L/D ratio (%) | 143 | 123 | 114,4 | 105,6 | 104,7 | 86,2 | 75,9 | 75,1 | 74,2 | 70,2 | 68,3 | 68,00 |
| 2 | NPL ratio (%) | 3,8 | 9 | 14,5 | 21,3 | 28,2 | 25,6 | 25,5 | 19,3 | 13,8 | 9,2 | 6,9 | 6,30 |
| 3 | ROE* (%) | 3,1 | n/a | n/a | n/a | n/a | n/a | 4,8 | 6,6 | 7,4 | 14,4 | 11,8 | 14,00 |
| 4 | Net interest margin (%) | n/a | 2,4 | 2,3 | 2,4 | 2,24 | 1,7 | 2,7 | 2,9 | 2,7 | 2,57 | 2,56 | 2,56 |
| 5 | Cost of risk (bps) | n/a | 200 | 255 | 315 | n/a | n/a | 171 | 75 | 38 | -62 | -43 | -23,00 |
*From 2009 – 2013 ROE is noted as “n/a”, as their net income was negative
As NLB published their Q1 2019 report, we are bringing you key takes from the report. According to it, the company observed an increase in net interest income of 5.8% YoY, amounting to EUR 79.4m. Net interest income has grown in all banks of the Group, as a result of loan volume growth and lower interest expenses. It is worth mentioning that the Group’s net interest margin remained flat at 2.56%.
Meanwhile, net fee and commission income observed an increase of 2%, amounting to EUR 40.1m. The increase could mainly be attributed to the new package offer for individuals that simplified the use of banking services.
Consequently, NLB recorded a net banking income of EUR 133.8m, representing an increase of 2.6%.
Moving further down the P&L, the company recorded operating expenses of EUR 69m, representing a decrease of 0.6%. The decrease mostly came as a result of a decline in administrative expenses (non-staff). As a result of that, CIR decreased by 1.7 p.p. and currently stands at 51.6%.
It is also noteworthy that the company recorded a release of credit impairment of provision of EUR 3.3m, leading to a negative cost of risk of -23bps. The mentioned release further improved the company’s bottom line.
In Q1, NLB recorded a net income of EUR 57.9m, representing an increase of 0.4%.
NLB Performance (Q1 2019 vs Q1 2018) (EUR m)
When observing the company’s balance sheet, loans and advances to customers amounted to EUR 7.3bn, representing an increase of 4.7%. On the other hand, deposits from customers amounted to EUR 10.7bn, representing an increase of 7.4%. Consequently, NLB recorded a decrease in L/D ratio by 1.9 p.p. and is currently standing at relatively low 68%.
In Q1 2019, NLB successfully reduced their NPLs by EUR 222.2m YoY, resulting in a decrease in the NPL ratio to 6.3% (-2.5 p.p.).
