"In the fourth quarter, banks operating in Estonia posted a net profit of €155 million from domestic operations, excluding dividend income from non-residents, bringing the total for 2025 to €652 million," the central bank said Tuesday.

Banks' profitability, measured as the ratio of profit to assets, remained in line with Estonia's ten-year average in the fourth quarter.

Since Euribor has remained relatively stable since the summer and financial markets do not expect major changes to interest rates, future bank profitability will largely depend on loan portfolio growth, Bank of Estonia explained.

As of the end of December, the combined balance sheet of banks in Estonia totaled €47.8 billion. That figure rose by 5.6 percent or €2.5 billion compared with the same time last year.

Banks' total loan portfolio grew by 7 percent or €1.9 billion over the year to €29 billion. While that growth was slightly below the pace seen in 2024, it still outpaced the average for the past decade, Eesti Pank noted.

Deposits held in banks stood at €33.5 billion in December, up €1.5 billion from a year earlier.

Of that amount, €7 billion were term deposits from resident households and companies, a figure that declined by 7 percent year-on-year. Deposits from non-residents grew by €596 million and accounted for 17 percent of total deposits.

Due to falling interest rates, the share of term deposits is down 9 percent or €650 million compared with a year ago, with the decline slightly more pronounced among companies than households.

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