Latvian business magazine the Telegraph has published an article on how the recent Covid-19 emergency situation affected the operation of the banks.
The heads of the country's largest financial institutions talked about how their banks restructured their work, what changes took root, what financial results they managed to achieve, and also shared their forecasts for the future.
Below we publish the comment of the Chairman of the Board of Rietumu Bank, Rolf Fuls:
“Immediately after the introduction of the emergency regime, we introduced changes to the bank’s operation quickly and effectively.
There are two main aspects here: we strictly followed the government orders issued to prevent the spread of infection, and, at the same time, the bank adapted its business processes to the current situation.
Looking at it retrospectively, we can say that the period of the pandemic has given us a very valuable experience. In particular, we have received an impetus for a deeper understanding and implementation of the opportunities that modern technologies and communication open up.
We have managed to organise effective remote work for the part of our employees, optimise the paperwork, control and other processes; some of the routine matters have been fully transformed into electronic format.
These few months were enough for many innovations to become part of, and gain a foothold, in our lives. For example, many customers liked to visit the bank by prior appointment - this procedure was introduced during the emergency situation; now we have already implemented such an opportunity through a mobile application, and soon it will appear on the bank's website.
We started conducting video conferences and using other forms of e-communication with our customers, colleagues, etc. much more often.
Other businesses have also experienced a similar transformation – in Latvia, in Europe, and in the entire world. We will never be as we were before the Covid crisis. It has outlined important trends that will remain for a long time: the dynamic growth of industries related to technology, the development of all types of remote services, and remote work for specialists.
About financial results. As we have already reported, the first quarter was very successful for Rietumu. However, already when publishing the March data, we noted that the negative impact of the crisis on the economy would appear in the second quarter, and possibly also further on.
The expected decline in business activity and customer transactions, which peaked in March-April due to international and local restrictions, slowed down the activities of many enterprises, forced work to stop on some projects and postponed the implementation of some new ideas. However, as we can judge from the work of our customers, the situation began to change for the better in June. We look forward to consolidating this trend.
When looking at the overall situation, hardly anyone can predict now with certainty how the world will come out of the recession and develop further on. Still, it is absolutely clear: a possibility of a sudden crisis, similar to the one experienced, will be included in the strategic development plans of companies and taken into account in risk assessment - and this is a very important stabilising factor.
It is also clear that a number of industries related to modern technologies, communications, medicine, services, logistics, etc. will receive a new impetus for development.
Despite the circumstances, Rietumu Bank has completed the first half of the year with a profit and positive dynamics in all major financial indicators. Our strategy remains the same: we focus on the regional market of Latvia and the Baltic states and, in a broader sense, the EU market, which we also consider our home market.
We define the further development of lending and investment in business projects of our customers as a priority in the foreseeable future.
Obviously, financial resources will be required to restore and restart many companies and projects. Being the largest independent bank in Latvia, we do have funds for this and are ready to provide them to our customers.
Now we are working on several new large-scale investment projects, which we will be able to talk about more comprehensively in the near future”.
