AS "Citadele banka” audited annual report for the year ended 31 December 2017

Published on

  • The Group's net interest income grew by 14%, reaching EUR 75.4 million 
  • Net credit portfolio grew by 7% in 2017 to EUR 1.33 billion
  • Capital adequacy ratio continued to grow, reaching 18.4%

In 2017, AS Citadele banka (the “Group”, “Citadele”) built on its high capital position, with the Group’s Capital Adequacy Ratio (CAR) rising to 18.4%, up from 16.5% at the end of 2016.

The Group also continued to generate stable profitability, with year-end adjusted RoE at 11.9% and adjusted RoA at 0.94% when excluding exceptional items. Citadele has consistently maintained these high profit indicators and stand as one of the most stable and reliable institutions in the market.

The Group’s net profit (before exceptional items) in 2017 was EUR 31.5 million. This result excludes the Bank’s EUR 23.2 million deferred tax asset write-off, which occurred as a result of changes in Latvian tax legislation and did not adversely impact the Group’s capital. Furthermore, Citadele anticipates that this recently implemented tax reform will have a positive impact on the Group’s net profit starting from 2018. On an as reported basis, the Group’s net profit was EUR 16.0 million.  

In 2017, Citadele continued working with a large liquidity reserve, supported by continued strength in client deposits that reached EUR 2.88 billion at year end. Deposit increases were visible in the retail private sector that saw 5% growth, but in particular in the SMEs sector and corporate clients sector that saw 21% and 32% growth, respectively.

The net loan portfolio for Citadele grew by 7% to EUR 1.33 billion in 2017, predominantly driven by the Group’s core strategy to promote lending to Baltic retail and SME clients. At the same time, asset quality also improved, with the Group’s non-performing loan (NPL) ratio decreasing to 8.3%, down from 9.9% at the end of 2016.

Over the course of 2017, the Group’s banking entities granted a total of EUR 469 million in new lending to clients, representing a 10% increase over 2016. In Latvia, the Bank granted EUR 266 million in new loans, whereas in Lithuania and Estonia newly granted loans amounted to EUR 142 million and EUR 64 million respectively.

 Citadele’s Chairman of the Management Board Guntis Beļavskis said:

“In 2017, Citadele reached its highest capital adequacy ratio since the Group’s founding. I am thankful to all our wonderful employees who collectively delivered this result as a team by investing their time, energy and resources into the Group’s long-term development.

We want to become the Baltic leader in digital banking services and e-payments for our customers. Therefore, in 2017, Citadele Group invested more than EUR 3 million in innovative technology solutions and the digitalization of our products and services. These improvements include mobile payments, new functionalities in the bank’s mobile banking application, improvements to the internet bank, and an automated credit scoring process for lending.

Over the last twelve months, we were the first bank in the Baltics to introduce payments by smartphone, bracelets and stickers as well as being the first bank to introduce touchscreen ATMs. We also completed 11 updates to the Citadele mobile banking app and 8 updates to the internet bank. Citadele was also the first bank in Latvia to join the Bank of Latvia instant-payment system and we continue to see the development of digital channels as the future of banking services.

Furthermore, since the beginning of 2017, Citadele began issuing contactless payment cards in order to create a suitable infrastructure for mobile payments in Latvia. In cooperation with global payments company Visa, Citadele has also launched a new X credit card for clients in Latvia.

Thanks in large part to our innovative efforts and enhanced customer service, we continue to build on our active client base throughout the Baltics. In 2017, one of the leading customer service evaluation firms in Central and Eastern Europe, Dive, acknowledged Citadele as the bank with the best customer service in Latvia and Lithuania.

In other developments, Moody’s Investors Service increased Citadele’s long-term credit rating by two notches (from B1 to Ba2) during 2017, and has maintained its positive outlook. Meanwhile, in November 2017, the bank completed its EUR 20 million subordinated debt issuance as part of its second subordinated bonds program. This allows the Group to refinance the existing subordinated liabilities with European Bank for Reconstruction and Development and to continue to improve the Group’s capital adequacy ratio.

I’m excited as ever by Citadele’s development potential. The Group has made further investments in several areas of the bank’s operations so that our development in the Baltics will continue to be even stronger and more stable in the coming years.”


Statement of corporate governance is publicly available on the website in Section ‘For investors’, Subsection ‘Financial statements’.

Recent announcements

Show all announcements