Published: 2020-11-05 07:00:00 CET
Quarterly report

Inbank Unaudited Financial Results for Q3 and 9 Months 2020

In Q3 2020 Inbank earned a net profit of 1.45 million euros. The net profit in the first 9 months of 2020 was 4.2 million euros. The return on equity in Q3 was 11.3%. 

  • Q3 net profit decreased by 35% compared to Q2 2019 and amounted to 1.45 million euros. Respectively, the net profit in the first 9 months of 2020 decreased by 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 by 62% year-on-year to 3.1 million euros.
  • Inbank loan portfolio increased 21% compared to Q3 2019 reaching 374 million euros while the deposit portfolio decreased 3.5% to 362 million euros at the end of Q3.
  • Total sales for Q3 was 88.2 million euros, showing an increase of 9% compared to Q3 of the previous year. In terms of products, personal loan sales decreased by 63% and car financing products by 18% while the sales finance volumes increased by 55% compared to the previous year. The share of sales finance in total sales was 74% or 65.6 million euros.
  • By the end of Q3, Inbank had 600,000 active contracts and worked with 3,200 merchant partners.

Jan Andresoo, Chairman of the Management Board, comments on the results:

“The third quarter was very fast-paced and eventful, and certainly more successful than expected. We 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 drop in sales volumes, the sales results of the third quarter were a positive surprise – the growth was 47% compared to the previous quarter. The total sales volume for all our markets amounted to 88.2 million euros and increased by 9% compared to the previous year. The share of sales finance in total sales was 74% or 65.6 million euros. This is a 55% increase year-on-year. One of the reasons is certainly the Polish unit, which has done 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 total sales finance volume.

The modest volumes of small loans were affected by our own decision to take a more conservative approach to credit underwriting. The quarterly sales of both car finance and small loans decreased significantly year-on-year: 18% and 63%, respectively. Although we were more conservative in credit underwriting, a general decline in demand was also noticeable.

As a large share of our customers applying for a grace period in the spring 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 customers continued to service their contracts as per usual. Also, the general payment discipline of customers can be considered very good at the moment.

We also made preparations for the launch of our first card product. Inpay, which is publicly launched by now, is a payment app and card with a unique cashback programme in Estonia, with which the customer earns money back on everyday purchases. As we enter the cards and payments market, we are moving into the territory of everyday shopping and see great potential in building a bridge between our extensive network of retailers and our customer base.

The coronavirus crisis naturally impacted our financial results, but sales volumes have recovered faster than expected and the third quarter ended with a clear positive note. Also, the crisis has not affected our product development and innovation capacity or reduced our investments. As an organisation, we continue to be growth-oriented and believe that new products will help us increase our growth rate again. ”

Key financial indicators 30.09.2020

Total assets EUR 449 million
Loan portfolio EUR 374 million
Deposit portfolio EUR 362 million
Total equity EUR 52 million
Net profit EUR 4.2 million
Return on equity 11.3%

Consolidated income statement (in thousands of euros)

9 months
9 months
Interest income10 6949 85431 97426 983
Interest expense-1 969-1 685-5 910-4 471
Net interest income8 7258 16926 06422 512
Fee income254255811687
Fee expense-546-459-1 548-1 261
Net fee and commission income-292-204-737-574
Net gains from financial assets measured at fair value02730539
Other operating income10725469578
Total net interest, fee and other income8 5408 26325 79623 055
Personnel expenses-2 152-2 001-7 008-5 898
Marketing expenses-301-518-1 001-1 687
Administrative expenses-962-1 009-3 061-2 739
Depreciations, amortisation-606-333-1 627-912
Total operating expenses-4 021-3 861-12 697-11 236
Profit before profit from associates and impairment losses on loans4 5194 40213 09911 819
Share of profit from associates7606680
Impairment losses on loans and advances-3 070-1 898-9 229-4 845
Profit before income tax1 5252 5044 5386 974
Income tax-74-283-350-408
Profit for the period1 4512 2214 1886 566
incl. shareholders of parent company1 4512 2214 1886 566
Other comprehensive income that may be reclassified subsequently to profit or loss    
Currency translation differences-119133-19582
Total comprehensive income for the period1 3322 3543 9936 648
incl. shareholders of parent company1 3322 3543 9936 648

Consolidated statement of financial position (in thousands of euros)

Due from central banks22 56383 080
Due from credit institutions16 58020 655
Investments in debt securities11 5670
Loans and advances 374 424338 157
Investments in associates3 7633 276
Tangible assets864840
Right of use asset445773
Intangible assets14 92711 721
Other financial assets8371 692
Other assets1 095588
Deferred tax asset1 9931 985
Total assets449 058462 767
Customer deposits361 854377 518
Other financial liabilities11 27913 545
Other liabilities2 7122 837
Debt securities issued4 0104 010
Subordinated debt securities17 55417 537
Total liabilities397 409415 447
Share capital909903
Share premium16 08215 908
Statutory reserve capital9088
Other reserves1 4111 463
Retained earnings33 15728 958
Total equity51 64947 320
Total liabilities and equity449 058462 767

Inbank is a consumer finance focused digital bank active in the Baltics and Poland with additional deposits accepted in Germany, Austria and the Netherlands. Inbank has over 3,200 active partners and 600,000 active contracts. Inbank bonds are listed on the Nasdaq Baltic Stock Exchange.

Additional information:

Merit Arva
Inbank AS
Head of Corporate Communications
+372 553 3550