Inbank unaudited financial results for Q3 and 9 months 2024

In Q3 2024 Inbank earned a consolidated net profit of 3.1 million euros, increasing 7% year-on-year. Profit for the first nine months of 2024 reached 10.8 million euros, marking a 46% increase compared to the previous year. The return on equity (ROE) in Q3 stood at 8.8% and for the first nine months of the year 10.9%. Loan and rental portfolio increased by 14.2% year-on-year, reaching 1.11 billion euros. The deposit portfolio grew by 14% compared to a year ago, totaling 1.16 billion euros...

Tallinn, 07/11/2024 (informazione.it - comunicati stampa - economia)

Loan and rental portfolio increased by 14.2% year-on-year, reaching 1.11 billion euros. The deposit portfolio grew by 14% compared to a year ago, totaling 1.16 billion euros. At the end of Q3, Inbank's total assets stood at 1.43 billion euros.
The Gross Merchandise Value (GMV) for the third quarter reached a record 184 million euros, which is 4% higher than the previous quarter and 1% compared to the previous year. Net interest income grew by 25% compared to last year, reflecting a strong underlying performance.
Auto marketplaces and dealers portfolio, now Inbank's largest segment, increased in the third quarter by 42% year-on-year reaching 64 million euros of GMV.
All other product segments maintained similar GMV in the third quarter compared to last year, except for merchant solutions sales which decreased by 15% compared to last year, amounting to 61 million euros of GMV due to strategic repricing efforts in Poland and Lithuania.
Inbank's retail portfolio Effective Interest Rate (EIR) continued to improve and reached in Q3 11.21% which is 0.41% higher than a year ago, driven by repricing efforts over the past two years.
In Q3, impairment losses were 1.5% of the loan portfolio. For the first nine months, the ratio stood at 1.5%, which is below Inbank's long-term average.
By the end of Q3, Inbank had 881,000 active contracts and 6,200 active merchant partners.

Priit Põldoja, Chairman of the Management Board, comments on the results:

“During the third quarter, Inbank continued to deliver strong results and steady revenue growth. Inbank's net interest income grew by 25% and total net income grew by 16% for the quarter compared to last year. Our Q3 revenue was negatively impacted by a 1.2 million euro fair value adjustment on financial instruments used to manage interest rate risks. During the first two quarters of the year, the company made a fair value gain on the same instruments.

Auto marketplaces and dealers financing continued to show very strong results during the third quarter, reaching 64 million euros of GMV, which is 42% more than a year ago, becoming now Inbank's largest segment in terms of sales and portfolio. Sales results were stable across product segments showing similar sales volumes compared to last year.

To support Inbank's growth plans, Inbank raised 10.14 million euros of equity in August. The lead investor was Swedbank pension funds, and the round was supported by 52 investors in total.

During the quarter, Inbank sold its 21% stake in financial technology start-up Paywerk to Swedbank AB. This transaction resulted in 0.7 million euros of extraordinary profit for the quarter. While Paywerk did not succeed as a stand-alone company, we are excited to see that the technology our team developed is valued by a leading regional retail bank.

During the third quarter, we launched the Smart Rent service for renting Apple products in iDeal stores in Lithuania, making the service now available in all three Baltic countries. We also started cooperation with the largest electronics retailer Datart in Czechia.

Inbank's financial performance has continued to improve throughout 2024. Although sudden changes in interest expectations resulted in weaker Q3 results, the current decline in the interest rate environment is expected to benefit our financial performance going forward. The superiority of our embedded finance solutions coupled with the declining interest rate environment will greatly support Inbank's growth ambitions in the upcoming quarters and years.”

Key financial indicators as of 30.09.2024 and for Q3
Total assets EUR 1.43 billion
Loan and rental portfolio EUR 1.11 billion
Deposit portfolio EUR 1.16 billion
Equity EUR 146.2 million
Net profit EUR 3.1 million
Return on equity 8.8%

Consolidated income statement (in thousands of euros)
	Q3 2024	*Q3 2024 restated**	9 months 2024	9 months 2023 restated
Interest income based on EIR	30,870	26,014	88,946	71,474
Interest expense	-13,603	-12,164	-40,287	-32,490
Net interest income	17,267	13,850	48,659	38,984

Fee and commission income	98	118	315	359
Fee and commission expenses	-1,268	-1,066	-3,637	-3,062
Net fee and commission income/expenses	-1,170	-948	-3,322	-2,703

Income from rental services	8,123	6,275	23,431	17,036
Sale of assets previously rented to customers	3,992	3,755	12,114	10,584
Other operating income	328	191	804	549
Cost of rental services	-5,252	-4,063	-15,378	-11,088
Cost of assets sold previously rented to customers	-3,949	-3,059	-11,685	-9,253
Net operating income/expenses	3,242	3,099	9,286	7,828

Net gains/losses from financial assets measured at fair value	-1,372	110	-177	76
Foreign exchange rate gain/losses	164	-501	382	-213
Net gain/losses from financial items	-1,208	-391	205	-137

Total net interest, fee and other income and expenses	18,131	15,610	54,828	43,972

Personnel expenses	-5,033	-3,981	-14,726	-12,152
Marketing expenses	-849	-753	-2,186	-2,418
Administrative expenses	-3,259	-2,955	-9,284	-8,073
Depreciations, amortization	-1,932	-1,629	-5,706	-4,601
Total operating expenses	-11,073	-9,318	-31,902	-27,244

Share of profit from associates	663	-72	663	322
Impairment losses on loans and receivables	-3,832	-3,354	-11,158	-9,968
Profit before income tax	3,889	2,866	12,431	7,082

Income tax	-796	34	-1,597	344
Profit for the period	3,093	2,900	10,834	7,426

Other comprehensive income that may be reclassified subsequently to profit or loss
Currency translation differences	-15	324	-272	-12
Total comprehensive income for the period	3,078	3,224	10,562	7,414

Consolidated statement of financial position (in thousands of euros)
	9/30/24	12/31/23	30.09.2023 restated
Assets
Cash and cash equivalents	192,998	172,921	150,701
Mandatory reserves at central banks	23,910	21,020	18,593
Investments in debt securities	35,236	33,581	31,164
Financial assets measured at fair value through profit or loss	15	79	119
Loans and receivables	1,021,059	942,056	895,610
Investments in associates	0	141	213
Other financial assets	3,512	5,268	2,958
Tangible assets	84,064	75,206	67,458
Right of use assets	21,603	26,716	24,810
Intangible assets	32,081	30,906	29,263
Other assets	8,876	8,185	10,974
Deferred tax assets	4,758	4,505	4,066
Total assets	1,428,112	1,320,584	1,235,929

Liabilities
Customer deposits	1,164,182	1,081,566	1,021,106
Financial liabilities measured at fair value through profit or loss	374	50	6
Other financial liabilities	60,086	60,927	59,488
Current tax liability	696	311	138
Deferred tax liability	482	204	203
Other liabilities	4,075	3,691	3,412
Subordinated debt securities	52,028	49,745	41,708
Total liabilities	1,281,923	1,196,494	1,126,061

Equity
Share capital	1,152	1,086	1,026
Share premium	54,656	43,563	31,855
Statutory reserve	109	103	103
Other reserves	1,344	1,543	1,865
Retained earnings	88,928	77,795	75,019
Total equity	146,189	124,090	109,868

Total liabilities and equity	1,428,112	1,320,584	1,235,929

Inbank is a financial technology company with an EU banking license that connects merchants, consumers and financial institutions on its next generation embedded finance platform. Partnering with 6,200 merchants, Inbank has 881,000+ active contracts and collects deposits across 7 markets in Europe. Inbank bonds are listed on the Nasdaq Tallinn Stock Exchange.

Additional information:
Merit Arva
Inbank AS
Head of Brand and Communications
[email protected]
+372 553 3550