LHV UK  (or the 'Company') announces it will today start issuing Small Medium Enterprise ('SME’) loans as the Financial Conduct Authority (the 'FCA') approved the Company's Annex I financial institution registration, a prerequisite to issuing loans in the United Kingdom under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017.

Powered by 14 years of consecutive growth, lending to SMEs has been one of the core business areas for LHV UK's parent company LHV Group (the 'Group'). In October, LHV UK acquired the SME lending business of Manchester-based regional lender Bank North, including its £17.9 million loan book, 20 sales and support staff and cooperation agreements with major loan brokers. Since the acquisition, LHV UK has only been able to service the existing customers, but the Company's enrollment in the financial services register enables LHV UK to immediately start issuing commercial real-estate-backed loans starting from £500,000.

The team, based in Manchester, form LHV UK's SME lending business and will maintain its regional approach and commit to further developing relationships with local commercial brokers, who are the key drivers for the loan business. In addition to the Manchester office, which will serve the North, LHV UK plans to start issuing loans in the South East from its London headquarters.

LHV UK uses technology to streamline and approve loans to local businesses faster than its competitors. The Company has ready access to capital and funding, which is essential when running a loan business.

Madis Toomsalu, Chairman of LHV UK, said: "Lending to enterprises has been the core business area of our parent company LHV Group, where it enjoyed 14 years of consecutive growth. There is a strong proven demand for SME loans, and we are confident that by leveraging our considerable experience and readily available capital, LHV UK can quickly establish and grow a strong lending business. Our strengths are technology-powered faster lending process and loan managers with long-term experience who understand the needs of local entrepreneurs."

LHV UK's current primary focus is obtaining a full UK banking licence. The application was submitted in March 2022 and is subject to regulatory approval by the Prudential Regulatory Authority and the FCA.