Ljubljana, 20 April (STA) - The state-owned SID Banka export and development bank posted EUR 8.5 million in net profit last year, which is significantly less than in the record year 2019, when net profit stood at EUR 32 million due to extraordinary non-interest revenue. The bank has assessed that the lower profit is mostly a result of the coronavirus crisis.
In the annual report published on Tuesday, the bank said that, due to the crisis, it had created impairments last year in addition to lowering interest rates and the interest margin, which stood at 0.9%.
The drop in revenue is also attributed to new rules for accounting interest and the related lower interest revenue, which was down 7.6% to EUR 28.6 million.
Net non-interest revenue decreased by 14.6% to EUR 35.7 million, which is a result of high non-interest revenue recorded in 2019 with the sale of the subsidiary SID-PKZ, the bank said, noting that supporting the economy had been preferred to profitability.
Operating costs stood at EUR 18.3 million, or 9.4% more than in 2019, mostly due to the bank's activities related to the Covid-19 epidemic and the related upgrade of the information system, which also required new hirings.
The bank's regulatory capital was up by 8% to EUR 457 million, while the capital adequacy was down to 29.1%, as a consequence of the crisis crediting and an increase in the risk-adjusted assets of the bank.
The share of non-performing claims stood at 3.6%, while the coverage of these claims with impairments was 53.8%.
Net expenses related to impairments and provisions amounted to EUR 30.1 million, which is a result of a combination of the worsened situation in the economy and greater crediting during the crisis, in particular of companies exposed to risks.
"2020 was the most difficult year in the history of SID Banka," as it helped the Slovenian economy mitigate the consequences of the coronavirus crisis, CEO Sibil Svilan said in the annual report, assessing that the bank had operated successfully.
The bank's loan portfolio was up by 14.5% to EUR 1.8 billion, and the number of clients was up by 21% last year, as the bank implemented two loan guarantee schemes on behalf of the state with the total potential exposure of EUR 2.2 billion.
Due to the coronavirus crisis, loans to the non-banking sector last year exceeded EUR 1 billion for the first time, increasing by 33.7% in comparison with 2019.
The share of these loans in the total loan portfolio was 62%, and a total of EUR 387 million in new loans was granted to non-banking sector clients in 2020.