Unaudited financial results of LHV Group for Q1 2026
The first quarter of 2026 was characterised by continued strong growth in business volumes, but also by a notable decline in profitability, driven by revenue pressure, weaker quarterly contributions from certain subsidiaries and faster growth in operating expenses. Despite a more challenging quarter, LHV Group moderately exceeded the financial plan in terms of net income, net profit and business volumes. LHV Group’s customer base increased to 705,000 customers
AS LHV Group generated consolidated net profit of EUR 19.7 million in Q1 2026, which is 36% less than in the previous quarter and 32% less than in the same period last year. AS LHV Pank earned a net profit of EUR 20.2 million and LHV Bank Ltd EUR 1.3 million. AS LHV Varahaldus recorded a net loss of EUR 0.6 million and AS LHV Kindlustus a net loss of EUR 0.7 million. The return on equity attributable to the shareholders of the Group was 10.7% in Q1.
On a consolidated basis, LHV Group generated total net income of EUR 73.7 million in Q1 2026, which was 7% less than in the previous quarter and 7% less than in the same period last year. Net interest income amounted to EUR 59.3 million and net fee and commission income to EUR 14.7 million. The Group’s Q1 net income was primarily affected by pressure on funding costs and a weaker quarterly result at LHV Kindlustus. Profitability was impacted also by faster increase in costs, which rose by 7% quarter-on-quarter and 21% year-on-year. Cost growth was primarily driven by one-off personnel expenses, outsourced consulting services and additional reserves. Total operating expenses amounted to EUR 45.6 million. Loan impairment charges totalled EUR 1.3 million in Q1, significantly lower than in the same period last year.
As at the end of March, LHV Group’s consolidated total assets stood at EUR 9.98 billion, down 2% from the end of the previous quarter and up 17% year-on-year. The consolidated loan portfolio grew by EUR 120 million, i.e. 2%, to EUR 5.59 billion in Q1 (+18% year-on-year). LHV Group’s consolidated deposits decreased by EUR 332 million (-4%) during the quarter to EUR 7.80 billion (+18% year-on-year). The decline was primarily driven by a EUR 249 million decrease in financial intermediaries’ deposits and a EUR 68 million decrease in other deposits. The aggregate volume of funds managed by LHV increased by EUR 16 million during the quarter to EUR 1.72 billion (+10% year-on-year). Financial intermediary customers processed 26.1 million payments in Q1, an increase of 7% compared to the previous quarter.
LHV Group is well capitalised and all capital targets have been met with comfortable buffers. The Group’s Common Equity Tier 1 (CET1) ratio stood at 16.2% at the end of Q1, the Tier 1 capital ratio at 18.0% and the total capital adequacy ratio (CAD) at 21.4%. The liquidity coverage ratio (LCR) was 192% and the net stable funding ratio (NSFR) 150%, both well above regulatory minimums.
At the Annual General Meeting held in March, shareholders voted to pay a dividend of EUR 0.17 per share for the previous financial year. The dividend was paid on 15 April. Based on the quarter-end closing share price, this represents a dividend yield of 4.8%.
For the first three months of 2026, LHV Group’s net income exceeded the financial plan by EUR 157 thousand and net profit by EUR 151 thousand. The loan portfolio exceeds the financial plan by EUR 5 million, deposits by EUR 92 million and fund volumes by EUR 1 million. The financial plan remains unchanged.
| Income statement, thousands of euros | Q1 2026 | Q4 2025 | Q1 2025 |
| Net interest income | 59,277 | 59,914 | 62,010 |
| Net fee and commission income | 14,698 | 18,312 | 14,071 |
| Net financial income | 313 | 215 | 2,747 |
| Result of the insurance service | -689 | 165 | 597 |
| Other operating income and expenses | 65 | 243 | -4 |
| Total net income | 73,664 | 78,849 | 79,421 |
| Staff costs | -25,737 | -23,062 | -22,655 |
| Office expenses | -713 | -782 | -659 |
| IT costs | -4,386 | -4,000 | -3,576 |
| Marketing expenses | -1,120 | -1,439 | -1,258 |
| Other operating expenses | -13,612 | -13,208 | -9,394 |
| Total expenses | -45,568 | -42,491 | -37,542 |
| Profit before loan impairment | 28,096 | 36,358 | 41,879 |
| Loan impairment | -1,289 | 1,670 | -5,667 |
| Income tax expense | -7,119 | -7,257 | -7,052 |
| Net profit | 19,688 | 30,771 | 29,160 |
| Minority holding | -160 | 826 | 592 |
| Profit attributable to shareholders of the parent company | 19,848 | 29,945 | 28,568 |
| Net profit per share, euros | 0.06 | 0.09 | 0.09 |
| Diluted net profit per share, euros | 0.06 | 0.09 | 0.09 |
| Balance sheet, thousands of euros | Mar 26 | Dec 25 | Mar 25 |
| Cash and due from banks | 3,875,262 | 4,312,403 | 3,279,271 |
| Financial assets | 456,985 | 402,991 | 442,463 |
| Loans to customers | 5,627,847 | 5,507,092 | 4,774,970 |
| Loan impairment reserve | -42,606 | -41,701 | -45,628 |
| Trade receivables | 28,288 | 12,387 | 10,511 |
| Other assets | 37,977 | 39,790 | 46,698 |
| Total assets | 9,983,753 | 10,232,962 | 8,508,285 |
| Demand deposits | 4,928,751 | 5,307,001 | 4,834,265 |
| Term deposits | 2,873,987 | 2,827,437 | 1,770,227 |
| Loans received | 1,054,680 | 1,043,617 | 936,215 |
| Trade payables and loans received | 8,857,418 | 9,178,055 | 7,540,707 |
| Accrued expenses and other liabilities | 188,873 | 80,798 | 163,691 |
| Subordinated debt | 209,252 | 206,928 | 126,247 |
| Total liabilities | 9,255,543 | 9,465,781 | 7,830,645 |
| Owners’ equity | 728,210 | 767,181 | 677,640 |
| incl. minority holding | 6,950 | 9,282 | 7,133 |
| Total liabilities and owners’ equity | 9,983,753 | 10,232,962 | 8,508,285 |
LHV Pank
LHV Pank reported a net profit of EUR 20.2 million. The quarterly result was primarily impacted by one-off personnel expenses and an approximately EUR 2.3 million revaluation effect from interest rate swaps, which is eliminated at the Group level. Excluding this effect, net profit would have amounted to EUR 22.5 million.
The number of LHV Pank customers increased by 8,900 during the quarter, reaching 500,400. Deposits decreased by EUR 425 million during the quarter to EUR 6.54 billion, with demand deposits declining by EUR 382 million and term deposits by EUR 45 million. The focus is increasingly shifting towards retail customer deposits and reducing the share of platform deposits.
LHV Pank’s loan portfolio increased by EUR 24 million during the quarter to EUR 4.71 billion. Growth was primarily driven by continued strong demand for mortgage loans. The corporate loan portfolio decreased due to the expiry of one large loan, while the bank focused on improving the return on its loan portfolio. Overall portfolio quality remained strong.
In February, LHV Pank launched a visual redesign of its mobile app. Additionally, the 24th edition of the Börsihai stock trading game was launched in February, attracting over 4,500 participants.
As at the end of Q1, LHV Pank’s net income is EUR 2.7 million below the financial plan and net profit EUR 1.4 million below. Deposits are EUR 57 million ahead of plan, while loans are EUR 16 million below plan.
LHV Bank
LHV Bank, operating in the United Kingdom, reported a net profit of EUR 1.3 million in the first quarter. While income grew strongly, costs increased faster than expected due to switch to cash, rather share option based, bonus payments and one-off personnel related costs. Profitability was also impacted by additional provisioning.
The loan portfolio of LHV Bank grew by EUR 93 million during the quarter to EUR 876 million (+79% year-on-year). The pipeline of approved but not yet disbursed loans stands at EUR 143 million. Provisions of EUR 1 million were made in Q1. Overall portfolio quality remains strong.
LHV Bank’s deposits increased by EUR 139 million during the quarter to EUR 1.43 billion (+74% year-on-year). Deposit growth in the quarter was strong, driven in particular by an increase in direct customer deposits. At the same time, the cost of funding improved slightly and reliance on intermediary-sourced deposits decreased.
Significant progress was made in technology and product development during Q1. An agentic AI proof of concept for customer support was successfully completed and regulatory approvals were obtained for offering consumer credit and providing ISA (Individual Savings Account) services. New product development is continuing on the basis of these approvals.
LHV Bank’s Q1 net income exceeded the financial plan by EUR 770 thousand, but net profit fell EUR 249 thousand short of the plan due to higher expenses and provisions. The loan portfolio exceeds the financial plan by EUR 17 million and deposits by EUR 137 million.
LHV Varahaldus
LHV Varahaldus recorded a net loss of EUR 0.6 million in Q1. The result was negatively affected by income tax associated with a dividend payment made in March (EUR 1.1 million), which was significantly higher than in previous periods. The first quarter was extremely turbulent in financial markets due to various geopolitical developments, but despite this, all LHV pension funds were the only funds in the Estonian market to deliver positive returns, outperforming competitors. LHV pension funds Julge, Ettevõtlik and Tasakaalukas returned 4.0%, 2.7% and 2.1% respectively in Q1. LHV Pensionifond Indeks, which has higher exposure to emerging markets compared to its competitors, returned 1.3% in Q1. The more conservative fund Rahulik returned 0.6%. The Pillar III fund Aktiivne III delivered a quarterly return of 4.0%. The number of active monthly contributors to Pillar II funds stood at 105,000 at quarter-end.
LHV Varahaldus’s net profit exceeds the financial plan by EUR 0.1 million for Q1, and fund volumes are in line with the plan.
LHV Kindlustus
The first quarter was challenging for LHV Kindlustus due to adverse weather conditions and the geopolitical situation in the Middle East. As a result, the net loss amounted to EUR 0.7 million, although early signs of stabilisation were visible in March. Net earned premiums remained at EUR 10.5 million, broadly in line with the previous quarter (+9% year-on-year). Gross incurred losses reached EUR 8.3 million, increasing by 14% quarter-on-quarter and 27% year-on-year, which pushed the insurance service result into negative territory for the first time in recent years. The net loss ratio rose to 82%. The quarter was characterised by an above-average number of claims and an above-average claim size. At the end of March, the number of active insurance contracts stood at 314,000 and the number of customers at 237,000.
LHV Kindlustus’s net profit is EUR 1.3 million below the financial plan for Q1. The volume of contract premiums written exceeds the financial plan by EUR 44 thousand.
Comment by Mihkel Torim, CEO of LHV Group:
“The first quarter of 2026 coincided with an important leadership transition at LHV Group. On 1 April, Erki Kilu took over as Chairman of the Management Board of LHV Pank and Kris Brewster became Interim CEO of LHV Bank in the United Kingdom. These changes bring a fresh perspective to LHV’s development in Estonia, place the management of our UK bank more firmly in the hands of a local team with direct market insight and strengthen the bridge between our two banks as we move into the next stage of development.
Against this backdrop, the quarter itself was demanding. Consolidated net profit of EUR 19.7 million was held back by pressure on funding costs, an unusually heavy claims quarter at LHV Kindlustus and higher operating expenses driven by one-off items. At the same time, business volumes continued to grow: the consolidated loan portfolio reached EUR 5.59 billion (+18% year-on-year), LHV Bank’s loan book grew 79% year-on-year and secured consumer credit and ISA approvals, and LHV’s pension funds were the only funds in the Estonian market to deliver positive returns in a highly volatile quarter. We moderately exceeded our financial plan, capital remains strong and the plan for the year remains unchanged.”
AS LHV Group reports are available at: https://investor.lhv.ee/en/reports/
To present the quarterly results, LHV Group will host a virtual investor meeting via Teams. The meeting will take place before market opening on 21 April at 11:00 AM EET. The presentation will be held in English. Please register in advance here.
LHV Group is the largest domestic financial group and capital provider in Estonia. LHV Group’s key subsidiaries are LHV Pank, LHV Varahaldus, LHV Kindlustus, and LHV Bank Limited. The Group employs approximately 1,200 people. The services of LHV Pank are being used by over 500,000 customers, the II pillar pension funds managed by LHV have 105,000 active customers and LHV Kindlustus protects a total of 237,000 customers. LHV Bank Limited, a subsidiary of the Group, holds a banking licence in the United Kingdom and provides banking services to international financial technology companies, as well as loans to small and medium-sized enterprises.
Investor Relations
Sten Hans Jakobsoo
Head of Investor Relations and Corporate Development
Email: stenhans.jakobsoo@lhv.ee
Communications
Paul Pihlak
Head of Communications
Email: paul.pihlak@lhv.ee
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