Blog | Going Strong: Bigbank loan portfolio grew by a fifth in six months

Going Strong: Bigbank loan portfolio grew by a fifth in six months

The loan portfolio of Bigbank AS, established on Estonian capital, grew 20.3% during the first half-year of 2021, reaching a record 711.4 million euros. To date Bigbank has been mostly granting loans to private clients, but has now successfully increased its market share in funding companies. In comparison with the same period of last year, the volume of new loans granted by the bank to business clients grew by 112.5%.

According to Bigbank Chairman of the Management Board Martin Länts, the volume of corporate loans has grown the most – 48.1% in 2021 Q2. „We are ready to offer the best terms in the market to companies, including longer loan periods and low interest margins. Our renewed strategy and strong capital base allow us to grant bigger loans than before, amounting up to 30 million euros. As a result, our position in the Estonian, Latvian and Lithuanian markets has become considerably stronger,“ Länts said.

We are ready to offer the best terms in the market to companies, including longer loan periods and low interest margins.
Martin Länts, CEO

„Our corporate loans were mainly aimed at the real estate and industrial sectors and as the only bank in Estonia, we have set ourselves a special priority to offer loans to the forestry and agricultural sectors. Their share of the new sales grew to 41% in Q2,“ added Länts.

The total year on year lending to private clients in the first half-year grew by 35.1%. “The demand was high in all countries where we operate. Estonia was leading the growth on account of great interest towards home loans“ Länts explained.

„In the second quarter we started offering home loans in Latvia and Lithuania as well. In Latvia we are providing home loans with a special schedule, which has turned out to be extremely popular in Estonia. It means that at the beginning of the repayment period, say, during up to the first twenty years, only monthly interest must be paid, and payment of the principal can be postponed for a later stage. Thus, it is possible to buy a home at the current real estate prices as well. This leaves the client with a lot of more free cash during the first half of the repayment schedule and further payments can be expected to be more affordable also due to inflation,“ Länts explained.

The total volume of Bigbank assets grew by 21.8%, reaching 923 million euros in the six months. The net profit of the half-year was 10.9 million euros, which is 13.8% more than that of the first half-year of 2020.

By the end of 2021 Q2 the Bigbank group had a total of 121,000 loan agreements – 39,000 in Lithuania, 33,000 in Latvia, 24,000 in Estonia, 14,000 in Finland and 11,000 in Sweden.

As at the end of the second quarter of 2021 Bigbank had 416 employees, of them 240 worked in Estonia, 76 in Lithuania, 68 in Latvia, 16 in Finland, 10 in Sweden and 6 in Bulgaria.