The Slovenia Times

NLB bank aiming to double business by end of 2030

The headquarters of the NLB bank. Photo: STA

Slovenia's largest banking group NLB is planning to double its total assets, revenue and profit by the end of 2030, to reach target figures of €50 billion, €2 billion and €1 billion, respectively.

The plans were set out as the bank presented its new strategy at an investor conference on 9 May, with CEO Blaž Brodnjak describing them as "credible as the region will grow faster than Western countries".

"We see the region in which NLB operates as a region of opportunity," he said. The group plans to grow organically and is prepared to tap into potential acquisition opportunities in the region.

Last year, the group posted roughly €1.1 billion in net revenue and a net profit of almost €551 million. In the first quarter of this year net profit was up by 17% year-on-year to €140 million and net operating income rose by 23% to €298 million as net interest income surged 30% to €232 million.

The group operates in Slovenia, North Macedonia, Bosnia-Herzegovina, Kosovo, Montenegro and Serbia. It has 2.9 million customers, almost 8,000 employees and 408 offices. Its total assets as of the end of March were just over €26 billion.

Plans to enter Croatia

The bank is not present in Croatia due to the issue of Yugoslav-era savings deposits.

However, Brodnjak says that things are moving in the right direction there too. He is confident that the group will succeed in becoming the first and only financial institution in the region to cover all the markets of the former Yugoslavia and connect the region through business.

A Slovenian-Croatian investor conference will be held on 10 May to further explore the opportunities and boost ties between some of the leading companies from the two markets.

Last year, NLB acquired SLS Holdco, the parent company of Summit Leasing Slovenia and its subsidiaries from funds managed by subsidiaries of Apollo Global Management and the European Bank for Reconstruction and Development (EBRD).

NLB says the acquisition gives it a leading position on the Slovenian market and, after obtaining all pending permits, entry into the Croatian market.

Higher return for shareholders

The bank aims to be a leader in South-East Europe that provides all financial services for individuals and businesses. It will promote a universal and digitalised banking model, and focus on local investment and prudent risk management.

It also plans to increase returns for its shareholders. Under the strategy, dividends are to rise from the current 40% of net profit to 50-60% of net profit.

NLB shares trade on the Ljubljana Stock Exchange and in the form of global depositary receipts (GDR) on the London Stock Exchange.

Holders of GDRs, who can convert them into shares, hold nearly 52% of all shares in the bank, of which the EBRD holds between 5% and 10%. The state holds 25% and other shareholders just over 23%, according information on the bank's website. The Bank of New York Mellon acts as the depositary of GDRs.

NLB's revenue is projected to rise to €1.2 billion in 2014 and 2025, up from the initial forecast of €1.1 billion. The group's mergers and acquisitions capacity is up to €4 billion of risk-weighted assets.


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