According to the results of an audit carried out by PricewaterhouseCoopers, Unibanka operating profits in the first half of the year amounted to 5.51 million lats ($9.34 million). The previously announced result of 6.13 million lats has been revised due to the increase of the bank's credit reserves by 243,000 lats and two adjustments in accounting.
"Including [the adjustments] in the first half of the year will make the results of the next half look better," said Unibanka's Vice President Zenon Olbraiss. "In reality they do not change anything."
The bank's total assets increased by 2 percent. According to Olbraiss, the slow growth of assets in the first half of the year is a typical phenomenon, and more significant asset growth is expected to take place in the second half.
Net loans grew by 11 percent to 12 percent, what Olbraiss called a very healthy figure. The second half of the year, again, is expected to be more fruitful.
The bank managed to restore the amount of deposits, which had dropped significantly in March 1999, to the 1998 level, a feat which makes the bank's management proud. Unibanka's capital adequacy is better than required by the central bank and international banking standards. Its returns on assets and equity ratios beat the ratios of leading Baltic banks, such as Hansapank, as well as Uhispank and Vilniuas Bankas, which are also partly owned by SEB.
Rikard Josefson, the second Unibanka vice president and the representative of SEB, said the Swedish bank was very pleased with the results of the first half of the year. Since SEB became the bank's strategic investor, its share in Unibanka has increased - a clear indication of Unibanka's profitability and sunny prospects, Josefson said. SEB has already received the central bank's permission to raise its share to over 50 percent.
Andris Berzins, the bank's president, said the audit was partly necessary because SEB had "big plans for Latvia, the Baltics and Europe in cooperation with Unibanka."
"We consider the Baltic countries our home market," Josefson said. "Yet SEB has no ambitions to turn Unibanka into SEB. Unibanka will be led by Latvian management and will operate for Latvian people and the Latvian economy. We like to consider ourselves a local Latvian bank with international strength."
Unibanka's Latvian management also looks into the future with optimism. The bank is currently working at receiving Standard & Poor's credit rating, Berzins said.
According to Berzins, receiving the rating is an expensive and complicated process and it is not yet known when Standard & Poor's assessment will be received. It was initially planned for September, but the term has been extended.
The bank is planning to expand its service base and is also thinking of acquiring a Latvian bank. Talks with several banks are underway, Berzins said.
Even after the acquisition Unibanka plans to operate primarily in Riga and does not want to expand its branch base from the current 73 branches.
At the end of June, Unibanka was the second largest Latvian bank in terms of assets. The bank's shares are quoted on the official list of the Riga Stock Exchange as well as on London's and Berlin's stock exchanges.
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