Capitalia expands its operations in the investment field by becoming an alternative investment fund management.
Year 2019 has been a dynamic one for Capitalia. We have issued a new record of EUR 20 million of loan and venture capital financing to small and medium businesses in the Baltic States. In addition, we have been the first alternative financing provider in the region to receive European compliance certificate for good code of conduct lending practices. So before jumping in the ambitious plans for the year 2020 let’s take a look how did the last period look in numbers.
In the fourth quarter of 2019 Capitalia reported anual turnover of EUR 1.25 million and profit before tax of EUR 124 thousand. The results are good reflection of the result of our strategy shift that was implemented over the course of the last year and as a result of which the Company is concentrating on financing of larger businesses through co-financing with other investors.
In the third quarter of 2019 Capitalia reported turnover of EUR 956 thousand and profit of EUR 132 thousand. The results are good reflection of the result of our strategy shift that was implemented over the course of the last year and as a result of which the Company is concentrating on financing of larger businesses through co-financing with other investors.
Capitalia and the European Investment Fund (EIF) have signed an agreement on a guarantee instrument supporting small businesses in Latvia, Lithuania and Estonia, for a total amount of EUR 10 million. With this guarantee, small businesses will get better access to finance. The agreement is supported by the European Fund for Strategic Investments (EFSI), the heart of the Investment Plan for Europe, and by the Employment and Social Innovation (EaSI) programme
During the year 2015 Capitalia has issued over 3 million of loans to small and medium sized businesses in the Baltic States. The financing offered by the company was used by 237 companies. Average issued loan amount to one company was EUR 9 000 while average term was 12 months. Most business loans were issued to companies in retail and manufacturing industries. Notably, most of the clients have been companies from the regions.
Investors are offered to invest in invoice backed short-term loans.
From today, February 4, marketplace platform Mintos will offer to its investors an opportunity to invest in AS Capitalia loans that are backed by issued but yet unpaid invoices. This enables to invest in invoices that small and medium sized companies have issued to largest enterprises in the Baltic States.
Capitalia, represented in NASDAQ Riga stock exchange, is the leading alternative financing provider for small and medium enterprises in Latvia and Lithuania. It offers modern and simple loans to businesses that often are overlooked by the traditional banking sector. To date Capitalia has financed working capital and investment needs of more than 500 enterprises investing over EUR 12 million. From January 2016 company has obtained necessary permits and will start servicing clients also in Estonia.
Twice per year the Bank of Latvia conducts a commercial bank survey including research of demand for business loans. Most of the banks since year 2010 have reported increasing demand for the particular type of financing. The trend seems to be clear and evident as the Latvian economic situation has experienced solid growth that in turn stimulates the entrepreneurial optimism and the desire to invest in business development. However, according to the quarterly report of The Financial and Capital Market Commission, despite the increasing demand, the total commercial bank business loan portfolio is declining.
On 9 April 2013 the regular General Meeting of Latvian Venture Capital Association took place and the main issue on the agenda was reelection of the board.
With full support from other members, the representative of Capitalia Juris Grišins will continue to perform his duties of board for the next two years.
Our aim is to contribute and promote the development of venture capital and alternative investments (microloan and mezzanine) sector in Latvia. Furthermore we will continue to assist to the government institutions to identify flaws and develop according support program to avoid them.
During the General Meeting the board adopted Code of Professional Ethics and changed the name of the Association to Latvian Private and Venture Capital Association.
Capitalia manager Juris Grišins participated in the conference organized by Ministry of Economics representing Latvian Venture Capital Association and presenting overview on alternative financing issues in Latvia.
The presentation reviews the current situation and the future perspectives of business microlending, mezzanine and venture capital sectors. For entrepreneurs interested in business financing there is relevant information mentioned in the presentation about the alternative investment providers in Latvia. The main finding from the presentation says that the financing for businesses is still difficult to access and to stimulate the availability further and continuous government support is necessary.