Latvia Economic and Defence Update

BANKING SECTOR PROFITABILITY IS STURDY AND STAYS ABOVE EU AVERAGE Profitability is set to improve further in 2023 due to rising net interest income 1.6% 1.4% 1.2% 1.0% 0.8% 0.6% 0.4% 0.2% Return on Assets 0.0% 2019 2020 2021 2022 75% Latvia 1.25% 70% Cost-to-income ratio 65% EU/EEA 60% EU/EEA 55% 50% Latvia 52.1% 2019 2020 2021 2022 29 Data on European Union (EU)/European Economic Area (EEA) are European Banking Authority (EBA) sample of largest institutions. For Latvia - FINREP data on all institutions are used Source: Latvijas Banka, European Banking Authority (EBA) Risk Dashboard and Latvijas Banka calculations

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