The steepest growth in business loans was observed in agriculture with new loans in the sector totaling €30m in the first quarter of 2016, up 130% from last year.
Manufacturing companies received €22.3m in loans, loans to the electric power, natural gas and heat supply sector totaled €41.5m, and €22.9m were issued in loans for commerce while loans to the transport and warehousing sector amounted to €18.4m and loans to the hotel and catering industry added up to €23.3m.
"Latvian banks which previously were very cautious about issuing loans have most certainly returned to the phase of moderate lending growth. Of course, we must not return to overindulgences of the years of the economic boom but, on the whole, banks are willing to cooperate if you have a feasible plan for business growth,” said Mārtiņš Bičevskis, President of the Latvian Association of Commercial Banks.
Most of the business loans have been issued to medium-sized, small and micro enterprises – 23%, 31% and 30% respectively while new loans issued to large companies account for 16%.
The aggregate loan portfolio of Latvian banks stood at €14.68b in late March this year, of which €9b were business loans and €4.4b were mortgage loans to Latvian households. In 2015 the aggregate loan portfolio increased 0.1% for the first time since the economic downturn.
The aggregate profit of Latvia's banking sector in Q1 2016 was €106.1m.