Best bank: Swedbank
Lithuanian banks successfully shrugged off a stagnating economy and the government’s windfall tax last year to double net profits.
After deducting the government’s levy on bank profits and other taxes, the sector generated a €986 million profit on net interest income of over €2 billion, more than double that earned the year before, according to the Bank of Lithuania.
Against this background, Swedbank, led by Inga Skisaker, chairwoman of the board, was not only the most profitable – making a net profit of €361 million, up 152% on 2022 – but also one of the most active in launching new, and enhancing existing, products and services.
Some of the standout developments include the introduction of a new customer communication platform; a new mobile terminal payment solution for corporate clients; an environmental, social and governance (ESG) self-assessment tool for business to help identify their main ESG risks; a green afforestation loan; and the issuance of the first agro loan with a sustainable farming certificate in Lithuania.
The afforestation loan – developed in cooperation with the Estonian startup Arbonics – is to finance the conversion of non-forested land to forest, while the €1 million agro loan was granted to Lithuanian agro company, Krekenava, for the acquisition of more sustainable agricultural machinery.
Overall, lending by the bank to the public (excluding credit institutions) was up 10% or €800 million year on year, which, along with higher interest rates, helped to drive net interest income to €609 million – up 181% on 2022.
Boosted by higher client activity, net commission income was also up, rising 7% year on year to €122 million.
In turn, this helped push the bank’s return on equity to 28.5% from 14.1% in 2022. Its return on assets was 2%, up from 0.9%.
