The Latvian banking sector earned a total of 246.2 million euros in 2013, new data shows.
New figures from the Financial and Capital Market Commission show how the banking sector's return on equity increased to eight percent by the end of December last year from 5 percent in 2012.
Last year, fifteen Latvian banks and five foreign banks' branches, which account for almost 95 percent of the banking sector's total assets, operated with profit.
The bank's cost and income structure has stabilized, the Financial and Capital Market Commission says.
The increase in banks' profit is mostly attributable to 10.4 percent rise in net interest income, 13.6 percent increase in net commissions, whereas net provisions for impaired loans decreased 10.9 percent.
After three years of losses, the banking sector returned to profit in 2012 when Latvian banks earned a total of 174 million euros.
The Financial and Capital Market Commission's Chairman Kristaps Zakulis believes that bank's profitability this year will be similar to that of 2013, adding that banks will continue to look for more efficient solutions.
The year 2013 was a balanced for the banking sector in Latvia; all market players are well prepared for continuing development this year, said Zakulis.
Three credit institutions halted operations in Latvia last year: "GE Money Bank", UniCredit Bank" and Latvian Mortgage and Land Bank" (Latvijas Hipoteku un zemes banka), therefore there were 26 credit institutions in Latvia at the beginning of this year - seventeen banks and nine foreign banks' branches.
The total number of financial institutions in the European Union decreased 3.6 percent last year; at the beginning of 2014, there were 8,476 financial institutions in the EU.