In the third quarter of 2020, Inbank achieved a net profit of 1.45 million euros. The net profit for the first 9 months of 2020 was 4.2 million euros. Q3 return on equity was 11.3%.
- The third quarter net result decreased by 35% compared to the second quarter 2019 and amounted to 1.45 million euros. Respectively, the net profit for the first 9 months of 2020 decreased 36% year-on-year to 4.2 million euros.
- Profit before loan losses for the quarter increased by 4% compared to Q3 2019 and amounted to 4.6 million euros. Provisions for loan losses increased 62% year-on-year to € 3.1 million.
- The bank loan portfolio increased by 21% compared to Q3 2019 to reach 374 million euros while the deposit portfolio fell 3.5% to 362 million euros at the end of Q3.
- Total Q3 revenue was EUR 88.2 million, an increase of 9% over Q3 the previous year. In terms of revenue, personal loan sales decreased by 63% and auto finance products by 18% while sales finance volumes increased by 55% from the previous year. The share of sales financing in total turnover is 74% or 65.6 million euros.
- At the end of the third quarter, Inbank had 600,000 active contracts and was working with 3,200 merchant partners.
Jan Andresoo, Chairman of the Management Board, comments on the results:
“The third quarter was very fast and hectic, and certainly more successful than expected. We have actively improved our existing products and prepared for the launch of our first credit card and mobile app.
While in the second quarter we saw a sharp decline in sales volumes, the third quarter sales results were a positive surprise – growth was 47% from the previous quarter. The total sales volume in all of our markets amounted to 88.2 million euros and increased by 9% compared to the previous year. The share of sales financing in total turnover is 74% or 65.6 million euros. This is a 55% increase year over year. One of the reasons is certainly the Polish unit, which did a great job with sales and was able to start cooperation with a large number of new sales finance partners. In the third quarter, Poland accounted for 46% of the total sales financing volume.
The modest volumes of small loans were affected by our own decision to take a more conservative approach to credit underwriting. Quarterly sales of auto finance and small loans declined significantly year over year: 18% and 63%, respectively. Although we were more cautious about credit underwriting, a general drop in demand was also noticeable.
Since a large portion of our clients requesting a spring grace period preferred a three month period, their next payment date after the grace period was in the third quarter. It is positive to note that 87% of these clients continued to honor their contracts as usual. In addition, the general discipline of paying customers can be considered very good at the moment.
We have also prepared the launch of our first card product. Inpay, which is now publicly launched, is an app and payment card with a cashback program unique in Estonia, with which the customer gets money back on their daily purchases. As we enter the card and payments market, we move into everyday shopping territory and see great potential in building a bridge between our vast network of retailers and our customer base.
The coronavirus crisis naturally impacted our financial results, but sales volumes recovered faster than expected and the third quarter ended on a clear positive note. In addition, the crisis has not affected our capacity for product development and innovation nor reduced our investments. As an organization, we continue to be growth oriented and believe that new products will help us to increase our growth rate again. “
Key financial indicators 30.09.2020
Total assets EUR 449 million
Loan portfolio 374 million euros
Deposit portfolio 362 million euros
Total equity 52 million euros
Net profit 4.2 million euros
Return on equity 11.3%
| Consolidated income statement (in thousands of euros) | ||||
| Q3 2020 |
Q3 2019 |
9 months 2020 |
9 months 2019 |
|
| Interest income | 10 694 | 9 854 | 31 974 | 26,983 |
| Interest expense | -1 969 | -1 685 | -5,910 | -4,471 |
| Net interest income | 8,725 | 8,169 | 26,064 | 22,512 |
| Fee income | 254 | 255 | 811 | 687 |
| Fee costs | -546 | -459 | -1 548 | -1 261 |
| Net commission and commission income | -292 | -204 | -737 | -574 |
| Net gains on financial assets measured at fair value | 0 | 273 | 0 | 539 |
| Other exploitation products | 107 | 25 | 469 | 578 |
| Net interest, fees and other total income | 8,540 | 8,263 | 25,796 | 23,055 |
| Personal expenses | -2 152 | -2,001 | -7,008 | -5,898 |
| Marketing costs | -301 | -518 | -1,001 | -1 687 |
| Administrative expenses | -962 | -1,009 | -3,061 | -2 739 |
| Depreciation, amortization | -606 | -333 | -1 627 | -912 |
| Total operating expenses | -4,021 | -3 861 | -12,697 | -11 236 |
| Profit before income from associates and impairment losses on loans | 4,519 | 4,402 | 13,099 | 11 819 |
| Share of associates’ profits | 76 | 0 | 668 | 0 |
| Impairment losses on loans and advances | -3,070 | -1 898 | -9 229 | -4 845 |
| Profit before income tax | 1,525 | 2 504 | 4,538 | 6,974 |
| Income tax | -74 | -283 | -350 | -408 |
| Profit for the period | 1,451 | 2 221 | 4 188 | 6 566 |
| incl. shareholders of the parent company | 1,451 | 2 221 | 4 188 | 6 566 |
| Other comprehensive income items that may be subsequently reclassified to income | ||||
| Currency conversion differences | -119 | 133 | -195 | 82 |
| Total comprehensive income for the period | 1332 | 2 354 | 3 993 | 6 648 |
| incl. shareholders of the parent company | 1332 | 2 354 | 3 993 | 6 648 |
| Consolidated statement of financial position (in thousands of euros) | ||
| 09/30/2020 | 12/31/2019 | |
| Assets | ||
| Due by central banks | 22,563 | 83080 |
| Due by credit institutions | 16,580 | 20 655 |
| Investments in debt securities | 11 567 | 0 |
| Loans and advances | 374,424 | 338,157 |
| Investments in partners | 3 763 | 3 276 |
| Tangible fixed assets | 864 | 840 |
| Right to use the asset | 445 | 773 |
| Intangible assets | 14 927 | 11 721 |
| Other financial assets | 837 | 1,692 |
| other assets | 1,095 | 588 |
| Deferred tax asset | 1,993 | 1 985 |
| Total assets | 449,058 | 462 767 |
| Liabilities | ||
| Customer deposits | 361 854 | 377,518 |
| Other financial liabilities | 11,279 | 13 545 |
| Other liabilities | 2,712 | 2 837 |
| Debt securities issued | 4,010 | 4,010 |
| Subordinated debt securities | 17,554 | 17,537 |
| Total responsibilities | 397,409 | 415,447 |
| Equity | ||
| Share the capital | 909 | 903 |
| Premium sharing | 16,082 | 15,908 |
| Statutory reserve capital | 90 | 88 |
| Other reserves | 1 411 | 1 463 |
| Retained earnings | 33,157 | 28 958 |
| Total equity | 51 649 | 47,320 |
| Total liabilities and equity | 449,058 | 462 767 |
Inbank is a digital consumer-lending bank active in the Baltic States and Poland, with additional deposits accepted in Germany, Austria and the Netherlands. Inbank has more than 3,200 active partners and 600,000 active contracts. Bank bonds are listed on the Nasdaq Baltic Stock Exchange.
Further information:
Merit Arva
Inbank AS
Head of corporate communications
[email protected]
+372 553 3550
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Inbank_Interim_Report_Q3_2020_EN
