Interim report for 1 January - 30 September 2009
Aktia Bank Plc
Interim Report
9.11.2009 at 10.00
Not for release or distribution in the United States, Australia, Canada or Japan
Aktia Bank Plc
Interim report for 1 January - 30 September 2009
Aktia Bank plc is the parent company in the Bank Group and started its banking
business on 30 September 2008. As Aktia Bank plc was established and started its
operations in 2008 we do not have any comparison figures in the financial
statements for the bank. The annual report for January - December encompasses
the results for the period 1 October - 31 December 2008.
Profit
The Bank Group's operating profit for continuing operations during the first
nine months was EUR 44.3 million (-). Profit after tax was EUR 30.7 million (-)
for January - September.
The Financial Supervisory Authority announced on 28 April 2009 that it had
approved Aktia Bank plc's sale of its shares in Aktia Life Insurance to the
Group's parent company Aktia plc. The transaction did not affect the operative
business of Aktia Life Insurance. The contract price corresponded to the
reported net asset value of the life insurance company which stood at EUR 45.5
million on 28 February 2009. Aktia Life Insurance is reported as a discontinued
operation in the Bank Group.
The banking business posted a profit of EUR 42.4 million for January -
September. Asset management was able to report a marginal improvement during the
latest quarter. Operating profit was EUR 0.5 million.
Income
The Bank Group's total income amounted to EUR 151.1 million, EUR 112.3 million
of which was net interest income.
Net commission income totalled EUR 27.7 million. Commission income from asset
management and brokering amounted to EUR 8.9 million. The brokering of funds and
insurance generated total income of EUR 13.5 million and accounted for 34.8% of
commission income. Card and payment services commission was EUR 8.5 million.
Total commission costs amounted to EUR 11.2 million. Among the commission costs,
commissions to savings and local cooperative banks for brokered mortgages
amounted to EUR 2.0 million.
Other operating income totalled EUR 2.3 million.
Expenditure
The Bank Group's total expenses were EUR 81.5 million.
Staff costs amounted to EUR 33.9 million. Other administration costs totalled
EUR 31.7 million. Among other administration costs, the largest cost items were
primarily attributed to IT which accounted for 36.2% of other administration
costs.
Total depreciation and write-downs on tangible and intangible assets amounted to
EUR 3.6 million. Other operating costs totalled EUR 12.3 million, of which the
costs of renting premises accounted for the larger share.
Balance sheet and off-balance sheet commitments
The Bank Group's balance sheet total increased by 2.1% from the year-end and
amounted to EUR 9,715 million (EUR 9,520 million at 31 December 2008) at the end
of the period.
The Bank Group's total lending to the public increased by 10.6% from the
year-end to EUR 6,006 million (EUR 5,432 million). Loans to private households
accounted for EUR 4,818 million, or 80.2% of the total loan stock. Of these
loans to households, 88.5% were secured against real estate collateral (in
accordance with Basel 2). Excluding the mortgages brokered by savings and local
cooperative banks which the local banks are committed to capitalise, the Bank
Group's lending totalled EUR 4,773 million.
Interest-bearing financial assets available for sale amounted to EUR 2,689
million (EUR 2,808 million). These assets mainly consist of the banking
business' liquidity reserve.
Deposits from the public and public sector entities totalled EUR 3,095 million
(EUR 3,099 million).
Outstanding certificates of deposit and bonds issued increased during the period
increased by 24.5% to EUR 2,638 million (EUR 2,119 million).
Off-balance sheet commitments totalled EUR 610 million (EUR 533 million).
The Bank Group's equity amounted to EUR 375 million (EUR 300 million) at the end
of the reporting period. The fund at fair value amounted to EUR 36 million (EUR
-35 million).
Capital adequacy
Aktia Bank Group's capital adequacy amounted to 15.7% compared to 13.7% at the
year-end. The Tier 1 capital ratio was the same as at the year-end, namely 9.3%.
The period's results and higher valuations of financial assets strengthened
capital adequacy. The Bank Group's capital adequacy remained at a good level,
exceeding both the capital adequacy targets set internally and the requirements
of the authorities.
Rating
Aktia Bank plc's credit rating by the international credit rating agency Moody's
Investors Service remains unchanged as at 23 September 2009. Aktia Bank plc's
credit rating for short-term borrowing is the best classification, P-1. The
credit rating for long-term borrowing is A1 and and that for financial strength
C. All ratings have a stable outlook.
The subsidiary Aktia Real Estate Mortgage Bank plc which issued long-term
covered bonds secured against real estate mortages has a Moody's credit rating
of Aa1 for all outstanding bonds.
Valuation of financial assets
Value changes reported via the fund at fair value
Value changes in interest-bearing securities where the issuer has not announced
an inability to pay and value changes in shares and participations which are not
deemed to be long-term or significant are reported in the fund at fair value,
which, taking cash flow hedging for the Group into consideration, amounted to
EUR 35.7 million after deferred tax, compared to EUR -13.8 million at 31
December 2008. The cash flow hedging which comprises the basic market value for
interest rate derivative contracts which have been acquired for the purposes of
protecting the banking business' net interest income amounted to EUR 20.8
million (EUR 12.4 million).
Specification of the fund at fair value
--------------------------------------------------------------------------------
| EUR million | 30.9.2009 | 31.12.2008 | Change |
--------------------------------------------------------------------------------
| Shares and | | | |
| participati | | | |
| ons | | | |
--------------------------------------------------------------------------------
| Banking | 0.0 | -0.2 | 0.2 |
| business | | | |
--------------------------------------------------------------------------------
| Life | 0.0 | -2.9 | 2.9 |
| insurance | | | |
| business | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Direct interest-bearing securities |
--------------------------------------------------------------------------------
| Banking | 14.9 | -26.3 | 41.1 |
| business | | | |
--------------------------------------------------------------------------------
| Life | 0.0 | -18.2 | 18.2 |
| insurance | | | |
| business | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Cash flow | 20.8 | 12.4 | 8.4 |
| hedging | | | |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Fund at | 35.7 | -35.1 | 70.8 |
| fair value, | | | |
| total | | | |
--------------------------------------------------------------------------------
Value changes reported via income statement
The value of financial assets is written down where, in the case of shares, the
value change has been announced as significant or long-term and, in the case of
interest-bearing securities, where the issuer has announced an inability to pay.
Write-downs for the period for continuing operations amounted to EUR 0.4 million
(EUR 4.6 million at 31 December 2008) and are attributable to one
interest-bearing security during the period.
Write-downs of financial assets
--------------------------------------------------------------------------------
| EUR million | 1-9 2009 | 1-12 2008 |
--------------------------------------------------------------------------------
| Interest-bearing | | |
| securities | | |
--------------------------------------------------------------------------------
| Banking business | 0.4 | 3.6 |
--------------------------------------------------------------------------------
| Life Insurance | - | 5.1 |
| business | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Shares and | | |
| participations | | |
--------------------------------------------------------------------------------
| Banking business | - | 1.0 |
--------------------------------------------------------------------------------
| Life Insurance | - | 29.4 |
| business | | |
--------------------------------------------------------------------------------
| Total | 0.4 | 39.2 |
--------------------------------------------------------------------------------
Write-downs of loan and guarantee claims
Write-downs based on individual examination of loan and guarantee claims
totalled EUR -26.2 million. Reversals of write-downs from previous years came to
EUR 0.3 million so that the cost effect on the profit for the period was EUR
-25.9 million.
The weak economic situation continues to be reflected in the write-downs of
corporate loans which amounted to EUR -23.5 million during the period and to EUR
-8.2 million during the last quarter. The period's write-downs of corporate
loans corresponds to just under 3% of total corporate lending.
Write-downs of household loans amounted to EUR -2.1 million, EUR -0.5 million of
which was accounted for by unsecured consumer loans. The period's write-downs of
household loans is equivalent to 0.04% of total lending to households.
In addition to individual write-downs, group write-downs were made for
households and small companies, where there were objective reasons to believe
there was uncertainty in relation to the repayment of claims in underlying
credit portfolios. Group write-downs for households and small companies remained
unchanged and amounted to EUR -7.4 million at the end of the period.
The Bank Group's risk management
Risk exposure
The banking business includes Retail Banking (including financing company
operations), Corporate Banking, Treasury and Asset Management.
Lending-related risks within banking
There have been no significant changes to the composition of the credit
portfolio during the first nine months of the year. Mortgages increased 11.0% to
EUR 4,481 million and the corresponding proportion of the total credit stock
rose to 74.6% (74.3% at 31 December 2008). Aktia Real Estate Mortgage Bank's
lending totalled EUR 2,403 million (EUR 1,968 million), of which EUR 1,170
million was brokered by savings and local co-operative banks.
The proportion of the total credit stock accounted for by corporate loans fell
as planned from 14.9% at the year-end to 14.1% at the end of the period. The
increase in corporate loans is primarily attributed to the parent company Aktia
plc.
Lending to the general public secured by collateral objects or unsecured within
the framework of the financing companies Aktia Corporate Finance and Aktia Card
& Finance totalled EUR 83.3 million (EUR 63.2 million), representing 1.4% of
total lending.
Credit stock by sector
--------------------------------------------------------------------------------
| EUR million | 30.9.2009 | 31.12.2008 | Change | Per-centage |
--------------------------------------------------------------------------------
| Corporate | 848.5 | 809.7 | 38.8 | 14.1 |
--------------------------------------------------------------------------------
| Housing | 272.0 | 220.2 | 51.8 | 4.5 |
| association | | | | |
| s | | | | |
--------------------------------------------------------------------------------
| Public | 10.8 | 11.7 | -0.9 | 0.2 |
| sector | | | | |
| entities | | | | |
--------------------------------------------------------------------------------
| Non-profit | 55.7 | 46.9 | 8.8 | 0.9 |
| organisation | | | | |
| s | | | | |
--------------------------------------------------------------------------------
| Households | 4,818.8 | 4,343.1 | 475.7 | 80.2 |
--------------------------------------------------------------------------------
| Total | 6,005.9 | 5,431.6 | 574.2 | 100.0 |
--------------------------------------------------------------------------------
Loans with payments 1-30 days overdue decreased during the period from 3.4% to
2.9% of the credit stock, including off-balance sheet guarantee commitments.
Loans with payments 31-90 days overdue increased from 0.9% to 1.1%, totalling
approximately EUR 66 million. Non-performing loans more than 90 days overdue,
including claims on bankrupt companies and loans for collection, totalled
approximately EUR 42 million, corresponding to 0.7% (0.5%) of the entire credit
stock plus bank guarantees.
Undischarged debts by time overdue
(EUR million)
--------------------------------------------------------------------------------
| Days | 30.9.2009 | % of the | 31.12.2008 | % of the |
| | | credit stock | | credit stock |
--------------------------------------------------------------------------------
| 1-30 | 174 | 2.9 | 187 | 3.4 |
--------------------------------------------------------------------------------
| of which | 118 | 2.0 | 110 | 2.0 |
| households | | | | |
--------------------------------------------------------------------------------
| 31-90 | 66 | 1.1 | 48 | 0.9 |
--------------------------------------------------------------------------------
| of which | 42 | 0.7 | 34 | 0.6 |
| households | | | | |
--------------------------------------------------------------------------------
| 91- | 42 | 0.7 | 26 | 0.5 |
--------------------------------------------------------------------------------
| of which | 26 | 0.4 | 16 | 0.3 |
| households | | | | |
--------------------------------------------------------------------------------
The Bank Group's financing and liquidity risks
Financing and liquidity risks are defined as the availability of refinancing
plus the differences in maturity between assets and liabilities. The objective
is to be able to cover one year's financing requirements using existing
liquidity. Despite continued uncertainty in the financial markets, the liquidity
status remained good and in line with this objective.
Counterparty risks
Counterparty risks within Group
Treasury liquidity management
The banking business' liquidity portfolio - which is managed by Group Treasury -
stood at EUR 2,660 million at 30 September 2009 (EUR 2,290 at 31 December 2008).
Counterparty risks arising in relation to liquidity management and entry into
derivative contracts are managed through conservative allocation and the
requirement for high-level external ratings (minimum A3 rating from Moody's or
equivalent). In addition, maximum exposure limits have been established for each
counterparty and asset type. Individual investment decisions are made in
accordance with an investment plan in place and are based on careful assessment
of the counterparty.
Of the financial assets available for sale, 52% (49%) were investments in
covered bonds, 35% (45%) were investments in banks, 10% (3%) were investments in
state-guaranteed bonds and approximately 3% (3%) were investments in public
sector entities and companies. Of these financial assets, 1.0% (0.9%) did not
meet the internal rating requirements. As a result of a reduced credit rating,
one security asset with a market value of EUR 4 million was no longer eligible
for refinancing with the central bank. Other securities that are not eligible
for refinancing due to the absence of a rating, totalled EUR 31 million.
During the period, write-offs totalling EUR -0.4 million were realised as a
result of the issuer announcing its inability to pay.
Rating distribution for the banking business' liquidity management operations
--------------------------------------------------------------------------------
| | 30.9.2009 | 31.12.2008 |
--------------------------------------------------------------------------------
| Aaa | 54.1% | 49.4% |
--------------------------------------------------------------------------------
| Aa1-Aa3 | 31.1% | 42.3% |
--------------------------------------------------------------------------------
| A1-A3 | 12.4% | 4.9% |
--------------------------------------------------------------------------------
| Baa1-Baa3 | 0.8% | 0.9% |
--------------------------------------------------------------------------------
| Ba1-Ba3 | 0.2% | 0.0% |
--------------------------------------------------------------------------------
| B1-B3 | 0.0% | 0.0% |
--------------------------------------------------------------------------------
| Caa1 or lower | 0.0% | 0.0% |
--------------------------------------------------------------------------------
| No rating | 1.4% | 2.5% |
--------------------------------------------------------------------------------
| Total | 100.0% | 100.0% |
--------------------------------------------------------------------------------
Market risks
The financial assets within the banking business are invested in securities with
access to market prices on an active market, and are valued in accordance with
official quoted prices. Any significant or long-term impairment of market value
compared to the acquisition price is shown in the income statement, while
interest-rate fluctuations are reported under the fund at fair value after the
deduction of deferred tax.
Market value and structural interest rate risk within the banking business
Market value interest rate risk refers to changes in value as a result of
interest rate fluctuations in financial assets available for sale. With an
interest rate increase of one percentage point for financial assets available
for sale, the net change of the fund at fair value at 30 September 2009 would be
EUR -26.5 million (-27.2 at 31 December 2008) after the deduction of deferred
tax.
The net change in the fund at fair value relating to market value interest rate
risk, credit and spread risk posted during the period totalled EUR 41.1 million
after the deduction of deferred tax.
Structural interest rate risk arises as a result of an imbalance between
interest rate ties and the re-pricing of assets and liabilities, and affects net
interest income. Investments within the liquidity portfolio and hedging
derivative instruments are exploited to reduce the volatility in net interest
income.
A parallel upward shift in the interest rate curve of one percentage point would
increase the net interest income of the banking business for the next 12 months
by 1.5% (-5.4%) while the target for structural interest rate risk management is
a maximum of -6%. For the next 12-24 months, the net interest income of the
banking business would increase by +5.8% (-6.0%) while the target for structural
interest rate risk management is a maximum of -8%.
A parallel downward shift in the interest rate curve of one percentage point
would increase the net interest income of the banking business for the next 12
months by +0.1% (+6.3%), while the target for structural interest rate risk
management is a maximum of -6%. For the next 12-24 months, the net interest
income of the banking business would reduce by -5.0% (+7.9%), while the target
for structural interest rate risk management is a maximum of -8%.
Operational risks
Operational risks refer to loss risks arising as a result of unclear or
incomplete instructions, activities carried out contrary to instructions,
unreliable information, deficient systems or actions taken by staff members.
If an operational risk is realised, this can result in direct or indirect
financial losses or tarnish the corporate image to the extent that the bank's
credibility in the marketplace suffers.
No significant incidents were recorded during the reporting period.
Personnel
When converted into full-time employees, the number of staff employed by the
Bank Group fell by 160 to 717 people during the first nine months. The average
number of full-time employees during January - September was 771.
Events after the end of the reporting period
Aktia Real Estate Mortgage Bank issued a covered bond with a nominal value of
EUR 150 million, a fixed interest rate and three-year maturity on 30 October
2009.
Outlook and risks that may have an effect on it
The Bank Group's operating profit during the fourth quarter is expected to reach
the same level as during the two first quarters. A sustained good credit rating
and the Bank Group's strengthened capital base are expected to enable
refinancing and moderate growth even in the current market situation.
The economic situation has brought about a higher level of write-downs, and a
new deterioration in the financial situation continues this could lead to
permanent reductions in the value of individual investments that are currently
deemed to be of good quality. This would have a negative effect on the Bank
Group's result. In addition, a requirement for higher returns among investors
may lead to a general price decrease in financial assets, which would have a
negative effect on the Bank Group's capital adequacy.
The importance of cost effectiveness will further increase in the current
economic and competitive situation.
Aktia Bank plc - The Bank Group's performance January - September 2009
Aktia Bank plc is the parent company in the Bank Group and started its banking
business on 30 September 2008. As Aktia Bank plc was established and started its
operations in 2008 we do not have any comparison figures in the financial
statements for the bank. The annual report for January - December encompasses
the results for the period 1 October - 31 December 2008.
Consolidated income statement for Bank Group
--------------------------------------------------------------------------------
| (EUR million) | 1-9 2009 | 1-9 2008 | 1-12 2008 |
--------------------------------------------------------------------------------
| Continuing operations | | | |
--------------------------------------------------------------------------------
| Net interest income | 112.3 | - | 35.5 |
--------------------------------------------------------------------------------
| Dividends | 0.1 | - | 0.2 |
--------------------------------------------------------------------------------
| Commission income | 38.9 | - | 26.0 |
--------------------------------------------------------------------------------
| Commission expenses | -11.2 | - | -14.2 |
--------------------------------------------------------------------------------
| Net commission income | 27.7 | - | 11.8 |
--------------------------------------------------------------------------------
| Life Insurance, net income | - | - | - |
--------------------------------------------------------------------------------
| Net income from financial | 8.6 | - | -2.8 |
| transactions | | | |
--------------------------------------------------------------------------------
| Net income from investment | 0.1 | - | 2.9 |
| properties | | | |
--------------------------------------------------------------------------------
| Other operating income | 2.3 | - | 8.3 |
--------------------------------------------------------------------------------
| Total operating income | 151.1 | - | 55.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Staff costs | -33.9 | - | -13.9 |
--------------------------------------------------------------------------------
| Other administrative expenses | -31.7 | - | -10.3 |
--------------------------------------------------------------------------------
| Negative goodwill recorded as income | - | - | - |
--------------------------------------------------------------------------------
| Depreciation of tangible and | -3.6 | - | -1.5 |
| intangible assets | | | |
--------------------------------------------------------------------------------
| Other operating expenses | -12.3 | - | -5.7 |
--------------------------------------------------------------------------------
| Total operating expenses | -81.5 | - | -31.4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Impairment and reversing items of | 0.0 | - | 0.4 |
| tangible and intangible assets | | | |
--------------------------------------------------------------------------------
| Write-downs of credits and other | -25.9 | - | -0.5 |
| commitments | | | |
--------------------------------------------------------------------------------
| Share of profit from associated | 0.7 | - | 0.2 |
| companies | | | |
--------------------------------------------------------------------------------
| Operating profit from continuing | 44.3 | - | 24.6 |
| operations | | | |
--------------------------------------------------------------------------------
| Taxes | -11.8 | - | -5.5 |
--------------------------------------------------------------------------------
| Profit for the period from | 32.5 | - | 19.1 |
| continuing operations | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Discontinued operations | | | |
--------------------------------------------------------------------------------
| Profit for the period from | -1.8 | - | -34.9 |
| discontinued operations | | | |
--------------------------------------------------------------------------------
| Profit for the period | 30.7 | - | -15.7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Attributable to: | | | |
--------------------------------------------------------------------------------
| Shareholders in Aktia Bank Plc | 31.4 | - | -16.4 |
--------------------------------------------------------------------------------
| Minority interest | -0.7 | - | 0.6 |
--------------------------------------------------------------------------------
| Total | 30.7 | - | -15.7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share attributable to shareholders | | |
| in Aktia Bank Plc, EUR | | |
--------------------------------------------------------------------------------
| Continuing operations | 11,049,265 | - | 6,164,833.4 |
| | .95 | | 1 |
--------------------------------------------------------------------------------
| Discontinued operations | -596,129.2 | - | -11,625,755 |
| | 7 | | .27 |
--------------------------------------------------------------------------------
| Total | 10,453,136 | - | -5,460,921. |
| | .67 | | 86 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| There is no dilution effect on | | | |
| earnings per share. | | | |
--------------------------------------------------------------------------------
Consolidated statement of comprehensive income for Bank Group
--------------------------------------------------------------------------------
| (EUR million) | 1-9 2009 | 1-9 2008 | 1-12 2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Continuing operations | | | |
--------------------------------------------------------------------------------
| Profit for the period from continuing | 32.5 | - | 19.1 |
| operations | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other comprehensive income after taxes: | | | |
--------------------------------------------------------------------------------
| Change in valuation of fair value for | 41.7 | - | -29.1 |
| financial assets available for sale | | | |
--------------------------------------------------------------------------------
| Change in valuation of fair value for | 8.4 | - | 13.6 |
| cash flow hedging | | | |
--------------------------------------------------------------------------------
| Transferred to the income statement for | 0.0 | - | 1.0 |
| financial assets available for sale | | | |
--------------------------------------------------------------------------------
| Transferred to the income statement for | 0.0 | - | -0.3 |
| cash flow hedging | | | |
--------------------------------------------------------------------------------
| Total comprehensive income for the | 82.6 | - | 4.3 |
| period for continuing operations | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Discontinued operations | | | |
--------------------------------------------------------------------------------
| Profit for the period from discontinued | -1.8 | - | -34.9 |
| operations | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other comprehensive income after taxes | | | |
--------------------------------------------------------------------------------
| Change in valuation of fair value for | -11.3 | - | -40.1 |
| financial assets available for sale | | | |
--------------------------------------------------------------------------------
| Change in valuation of fair value for | - | - | - |
| cash flow hedging | | | |
--------------------------------------------------------------------------------
| Transferred to the income statement for | 0.3 | - | 24.4 |
| financial assets available for sale | | | |
--------------------------------------------------------------------------------
| Transferred to the income statement for | - | - | - |
| cash flow hedging | | | |
--------------------------------------------------------------------------------
| Total comprehensive income for the | -12.8 | - | -50.5 |
| period for discontinued operations | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total comprehensive income for the | 69.8 | - | -46.2 |
| period | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total comprehensive income attributable | | | |
| to | | | |
--------------------------------------------------------------------------------
| Shareholders in Aktia Bank Plc | 70.1 | - | -46.3 |
--------------------------------------------------------------------------------
| Minority interest | -0.3 | - | 0.1 |
--------------------------------------------------------------------------------
| Total | 69.8 | - | -46.2 |
--------------------------------------------------------------------------------
Consolidated balance sheet for Bank Group
--------------------------------------------------------------------------------
| (EUR million) | 30.9.2 | 31.12.2 | Change | 30.9.20 |
| | 009 | 008 | | 08 |
--------------------------------------------------------------------------------
| Assets | | | | |
--------------------------------------------------------------------------------
| Cash and balances with central banks | 268.8 | 506.3 | -46.9% | - |
--------------------------------------------------------------------------------
| Financial assets reported at fair | 3.6 | 19.5 | -81.6% | - |
| value through profit and loss | | | | |
--------------------------------------------------------------------------------
| Interest-bearing securities | 2,689. | 2,808.4 | -4.3% | - |
| | 0 | | | |
--------------------------------------------------------------------------------
| Shares and participations | 26.4 | 211.5 | -87.5% | - |
--------------------------------------------------------------------------------
| Financial assets available for sale | 2,715. | 3,019.9 | -10.1% | - |
| | 4 | | | |
--------------------------------------------------------------------------------
| Financial assets held until maturity | 30.9 | 35.9 | -13.9% | - |
--------------------------------------------------------------------------------
| Derivative instruments | 218.9 | 137.0 | 59.8% | - |
--------------------------------------------------------------------------------
| Lending to credit institutions | 122.8 | 100.5 | 22.1% | - |
--------------------------------------------------------------------------------
| Lending to the public and public | 6,005. | 5,431.6 | 10.6% | - |
| sector entities | 9 | | | |
--------------------------------------------------------------------------------
| Loans and other receivables | 6,128. | 5,532.2 | 10.8% | - |
| | 6 | | | |
--------------------------------------------------------------------------------
| Investments for unit-linked | - | 148.1 | - | - |
| provisions | | | | |
--------------------------------------------------------------------------------
| Investments in associated companies | 3.2 | 2.8 | 13.9% | - |
--------------------------------------------------------------------------------
| Intangible assets | 7.5 | 10.3 | -27.3% | - |
--------------------------------------------------------------------------------
| Investment properties | 0.0 | 0.0 | 0.0% | - |
--------------------------------------------------------------------------------
| Other tangible assets | 5.2 | 5.9 | -12.8% | - |
--------------------------------------------------------------------------------
| Accrued income and advance payments | 66.8 | 78.7 | -15.2% | - |
--------------------------------------------------------------------------------
| Other assets | 258.9 | 5.9 | - | - |
--------------------------------------------------------------------------------
| Total other assets | 325.7 | 84.7 | 284.7% | - |
--------------------------------------------------------------------------------
| Income tax receivables | 3.0 | 2.4 | 24.3% | - |
--------------------------------------------------------------------------------
| Deferred tax receivables | 4.4 | 14.8 | -70.4% | - |
--------------------------------------------------------------------------------
| Tax receivables | 7.4 | 17.2 | -57.3% | - |
--------------------------------------------------------------------------------
| Total assets | 9,715. | 9,519.9 | 2.1% | - |
| | 1 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Liabilities | | | | |
--------------------------------------------------------------------------------
| Liabilities to credit institutions | 1,706. | 1,917.0 | -11.0% | - |
| | 7 | | | |
--------------------------------------------------------------------------------
| Liabilities to the public and public | 3,095. | 3,099.0 | -0.1% | - |
| sector entities | 1 | | | |
--------------------------------------------------------------------------------
| Deposits | 4,801. | 5,016.0 | -4.3% | - |
| | 8 | | | |
--------------------------------------------------------------------------------
| Financial liabilities reported at | - | 4.6 | - | - |
| fair value through profit and loss | | | | |
--------------------------------------------------------------------------------
| Derivative instruments | 141.6 | 84.7 | 67.1% | - |
--------------------------------------------------------------------------------
| Debt securities issued | 2,638. | 2,118.7 | 24.5% | - |
| | 5 | | | |
--------------------------------------------------------------------------------
| Subordinated liabilities | 246.0 | 246.8 | -0.3% | - |
--------------------------------------------------------------------------------
| Other liabilities to credit | 1,047. | 502.1 | 108.5% | - |
| institutions | 0 | | | |
--------------------------------------------------------------------------------
| Other liabilities to the public and | 189.8 | 262.8 | -27.8% | - |
| public sector entities | | | | |
--------------------------------------------------------------------------------
| Other financial liabilities | 4,121. | 3,130.4 | 31.7% | - |
| | 3 | | | |
--------------------------------------------------------------------------------
| Technical provision (excl. technical | - | 627.6 | - | - |
| provision for unit-linked insurances) | | | | |
--------------------------------------------------------------------------------
| Technical provision for unit-linked | - | 149.6 | - | - |
| insurances | | | | |
--------------------------------------------------------------------------------
| Accrued expenses and income received | 57.9 | 79.4 | -27.0% | - |
| in advance | | | | |
--------------------------------------------------------------------------------
| Other liabilities | 164.7 | 87.3 | 88.5% | - |
--------------------------------------------------------------------------------
| Total other liabilities | 222.6 | 166.7 | 33.5% | - |
--------------------------------------------------------------------------------
| Provisions | 0.2 | 0.0 | 547.9% | - |
--------------------------------------------------------------------------------
| Income tax liabilities | 6.3 | 2.1 | 192.5% | - |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 46.2 | 38.0 | 21.8% | - |
--------------------------------------------------------------------------------
| Tax liabilities | 52.5 | 40.1 | 30.9% | - |
--------------------------------------------------------------------------------
| Total liabilities | 9,339. | 9,219.7 | 1.3% | - |
| | 9 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity | | | | |
--------------------------------------------------------------------------------
| Restricted equity | 198.7 | 127.9 | 55.3% | - |
--------------------------------------------------------------------------------
| Unrestricted equity | 146.6 | 147.3 | -0.5% | - |
--------------------------------------------------------------------------------
| Shareholders' share of equity | 345.3 | 275.2 | 25.5% | - |
--------------------------------------------------------------------------------
| Minority interest's share of equity | 30.0 | 24.9 | 20.2% | - |
--------------------------------------------------------------------------------
| Equity | 375.3 | 300.2 | 25.0% | - |
--------------------------------------------------------------------------------
| Total liabilities and equity | 9,715. | 9,519.9 | 2.1% | - |
| | 1 | | | |
--------------------------------------------------------------------------------
Consolidated cash flow statement for Bank Group
--------------------------------------------------------------------------------
| (EUR million) | 1-9 | 1-9 2008 | 1-12 |
| | 2009 | | 2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from operating activities | | | |
--------------------------------------------------------------------------------
| Operating profit *) | 44.0 | - | -23.1 |
--------------------------------------------------------------------------------
| Adjustment items not included in cash flow | 26.9 | - | 37.6 |
| for the period | | | |
--------------------------------------------------------------------------------
| Paid income taxes | -7.0 | - | -9.4 |
--------------------------------------------------------------------------------
| Cash flow from operating activities before | 63.8 | - | 5.2 |
| change in operating receivables and | | | |
| liabilities | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Increase (-) or decrease (+) in receivables | -1,127. | - | -590.6 |
| from operating activities | 8 | | |
--------------------------------------------------------------------------------
| Increase (+) or decrease (-) in liabilities | 820.7 | - | 645.1 |
| from operating activities | | | |
--------------------------------------------------------------------------------
| Total cash flow from operating activities | -243.3 | - | 59.6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from investing activities | | | |
--------------------------------------------------------------------------------
| Financial assets held until maturity | 5.0 | - | 10.0 |
--------------------------------------------------------------------------------
| Acquisition of subsidiaries and associated | -0.1 | - | -27.4 |
| companies **) | | | |
--------------------------------------------------------------------------------
| Divestment of subsidiaries and associated | 34.6 | - | - |
| companies **) | | | |
--------------------------------------------------------------------------------
| Investments in tangible and intangible | -3.4 | - | -5.0 |
| assets | | | |
--------------------------------------------------------------------------------
| Proceeds from sale of tangible and | 1.0 | - | 42.9 |
| intangible assets | | | |
--------------------------------------------------------------------------------
| Share issue of Aktia Real Estate Mortgage | 6.6 | - | 3.8 |
| Bank Plc to the minority | | | |
--------------------------------------------------------------------------------
| Total cash flow from investing activities | 43.8 | - | 24.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from financing activities | | | |
--------------------------------------------------------------------------------
| Subordinated liabilities | 1.9 | - | 55.3 |
--------------------------------------------------------------------------------
| Total cash flow from financing activities | 1.9 | - | 55.3 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Change in cash and cash equivalents | -197.6 | - | 139.1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash and cash equivalents at the beginning | 512.3 | - | 20.3 |
| of the year | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents transferred in | - | - | 353.0 |
| connection with transfer of business | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at the end of the | 314.8 | - | 512.3 |
| period | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash and cash equivalents in the cash flow | | | |
| statement consist of the following items: | | | |
--------------------------------------------------------------------------------
| Cash in hand | 8.6 | - | 10.0 |
--------------------------------------------------------------------------------
| Insurance operations' cash and cash | - | - | 3.7 |
| equivalents | | | |
--------------------------------------------------------------------------------
| Bank of Finland current account | 260.2 | - | 492.6 |
--------------------------------------------------------------------------------
| Loans to credit institutions repayable on | 46.0 | - | 6.0 |
| demand | | | |
--------------------------------------------------------------------------------
| Total | 314.8 | - | 512.3 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Adjustment items not included in cash flow | | | |
| for the period consist of | | | |
--------------------------------------------------------------------------------
| Write-downs of financial assets | 0.4 | - | 39.2 |
--------------------------------------------------------------------------------
| Write-downs of credits and other commitments | 25.9 | - | 0.5 |
--------------------------------------------------------------------------------
| Change in fair value | -2.7 | - | 2.5 |
--------------------------------------------------------------------------------
| Depreciation, amortisation and impairment of | 3.7 | - | 3.3 |
| tangible and intangible assets | | | |
--------------------------------------------------------------------------------
| Share of profit from associated companies | -0.4 | - | -0.1 |
--------------------------------------------------------------------------------
| Capital gains and losses from the sale of | -0.1 | - | -7.3 |
| tangible and intangible assets | | | |
--------------------------------------------------------------------------------
| Other adjustments | 0.0 | - | -0.4 |
--------------------------------------------------------------------------------
| Total | 26.9 | - | 37.6 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Discontinuing operations' share of cash flow | | | |
| in the Bank Group, net | | | |
--------------------------------------------------------------------------------
| Cash flow from operating activities | -2.5 | - | 8.1 |
--------------------------------------------------------------------------------
| Cash flow from investing activities | 0.0 | - | -1.6 |
--------------------------------------------------------------------------------
| Cash flow from financing activities | - | - | - |
--------------------------------------------------------------------------------
| Total | -2.6 | - | 6.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| *) Includes operating profit from both | | | |
| continuing and discontinued operations | | | |
--------------------------------------------------------------------------------
| **) The amount for 2008 includes the additional contract price | |
| for the acquisation of Aktia Life Insurance Ltd. | |
--------------------------------------------------------------------------------
Consolidated statement of changes in equity for Bank Group
--------------------------------------------------------------------------------
| (EUR | Share | Other | Fund | Un-re | Retai | Share | Minori | Total |
| million) | capit | restr | at | stric | ned | -hold | ty | Equity |
| | al | icted | fair | ted | earni | ers' | intere | |
| | | equit | value | equit | ngs | share | st's | |
| | | y | | y | | of | share | |
| | | | | reser | | equit | of | |
| | | | | ve | | y | equity | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity as | 163.0 | 0.0 | -35.1 | 44.6 | 102.8 | 275.2 | 24.9 | 300.2 |
| at 1 | | | | | | | | |
| January | | | | | | | | |
| 2009 | | | | | | | | |
--------------------------------------------------------------------------------
| Share | | | | 0.0 | | 0.0 | | 0.0 |
| issue | | | | | | | | |
--------------------------------------------------------------------------------
| Dividends | | | | | | 0.0 | | 0.0 |
| to | | | | | | | | |
| shareholde | | | | | | | | |
| rs | | | | | | | | |
--------------------------------------------------------------------------------
| Total | | | 39.1 | | 31.0 | 70.1 | -0.3 | 69.8 |
| comprehens | | | | | | | | |
| ive income | | | | | | | | |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | 0.0 | 32.1 | | -32.1 | 0.0 | 5.3 | 5.3 |
| change in | | | | | | | | |
| equity | | | | | | | | |
--------------------------------------------------------------------------------
| Equity as | 163.0 | 0.0 | 36.1 | 44.6 | 101.7 | 345.3 | 30.0 | 375.3 |
| at 30 | | | | | | | | |
| September | | | | | | | | |
| 2009 | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity at | 0.0 | 0.0 | -4.3 | 0.0 | 34.2 | 30.0 | 14.2 | 44.1 |
| 1 January | | | | | | | | |
| 2008 | | | | | | | | |
--------------------------------------------------------------------------------
| Share | 163.0 | | | 44.6 | | 207.6 | | 207.6 |
| issue | | | | | | | | |
--------------------------------------------------------------------------------
| Dividends | | | | | | 0.0 | | 0.0 |
| to | | | | | | | | |
| shareholde | | | | | | | | |
| rs | | | | | | | | |
--------------------------------------------------------------------------------
| Total | | | -30.5 | | -15.8 | -46.3 | 0.1 | -46.2 |
| comprehens | | | | | | | | |
| ive income | | | | | | | | |
| for the | | | | | | | | |
| period | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | -0.9 | | 84.9 | 84.0 | 10.7 | 94.7 |
| change in | | | | | | | | |
| equity | | | | | | | | |
--------------------------------------------------------------------------------
| Equity at | 163.0 | 0.0 | -35.6 | 44.6 | 103.3 | 275.2 | 24.9 | 300.2 |
| 31 | | | | | | | | |
| December | | | | | | | | |
| 2008 | | | | | | | | |
--------------------------------------------------------------------------------
Key figures
--------------------------------------------------------------------------------
| | 1-9 2009 | 1-6 2009 | 1-3 2009 | 1-12 2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share, continuing | 11.0 | 6.4 | 2.8 | 6.2 |
| operations, EUR million | | | | |
--------------------------------------------------------------------------------
| Earnings per share, | -0.6 | -0.6 | -0.6 | -11.6 |
| discontinued operations, EUR | | | | |
| million | | | | |
--------------------------------------------------------------------------------
| Earnings per share, total, EUR | 10.5 | 5.8 | 2.2 | -5.5 |
| million | | | | |
--------------------------------------------------------------------------------
| Equity per share, EUR million | 115.1 | 99.2 | 91.5 | 91.7 |
--------------------------------------------------------------------------------
| Return on equity (ROE),% | 12.1 | 10.5 | 8.6 | -5.2 |
--------------------------------------------------------------------------------
| Earnings per share excluding | 34.1 | 18.1 | -0.3 | -15.4 |
| negative goodwill recorded as | | | | |
| income and including the fund | | | | |
| at fair value, EUR million | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Average number of shares | 3 | 3 | 3 | 3 |
--------------------------------------------------------------------------------
| Number of shares at end of | 3 | 3 | 3 | 3 |
| period | | | | |
--------------------------------------------------------------------------------
| Personnel (FTEs), average | 771 | 794 | 845 | 879 |
| number of employees from the | | | | |
| beginning of the financial | | | | |
| year | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Banking Business (incl. | | | | |
| Private Banking) | | | | |
--------------------------------------------------------------------------------
| Cost-to-income ratio | 0.54 | 0.57 | 0.68 | 0.56 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Borrowing from the public, EUR | 3,095 | 3,091 | 3,105 | 3,099 |
| million | | | | |
--------------------------------------------------------------------------------
| Lending to the public, EUR | 6,006 | 5,826 | 5,599 | 5,432 |
| million | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital adequacy ratio,% | 15.7 | 14.7 | 14.2 | 13.7 |
--------------------------------------------------------------------------------
| Tier 1 capital ratio,% | 9.3 | 9.2 | 9.0 | 9.3 |
--------------------------------------------------------------------------------
| Risk-weighted commitments, EUR | 3,493 | 3,395 | 3,335 | 3,313 |
| million | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Asset Management | | | | |
--------------------------------------------------------------------------------
| Mutual fund volume, EUR | 3,488 | 2,927 | 2,415 | 2490,*) |
| million | | | | |
--------------------------------------------------------------------------------
| Managed and brokered assets, | 5,680 | 5,083 | 4,515 | 4,538 |
| EUR million | | | | |
--------------------------------------------------------------------------------
*) Including fund volume of Aktia Invest from December 2008.
Basis of calculation for key figures
--------------------------------------------------------------------------------
| Cost-to-income ratio, banking business |
--------------------------------------------------------------------------------
| Total operating expenses |
| Total operating income |
--------------------------------------------------------------------------------
| Earnings per share, EUR |
--------------------------------------------------------------------------------
| Profit for the year after taxes attributable to the shareholders of Aktia |
| Bank Plc |
| Average number of shares over the period (adjusted for share issue) |
--------------------------------------------------------------------------------
| Equity per share, EUR |
--------------------------------------------------------------------------------
| Equity attributable to the shareholders of Aktia Bank Plc |
| Number of shares at the end of the period |
--------------------------------------------------------------------------------
| Return on equity (ROE),% |
--------------------------------------------------------------------------------
| Profit for the period x 100 |
| Average equity |
--------------------------------------------------------------------------------
| Capital adequacy ratio,% |
--------------------------------------------------------------------------------
| Capital base (Tier 1 capital + Tier 2 capital) x 100 |
| Risk-weighted commitments |
| The capital base is calculated in accordance with regulation 4.3a issued by |
| the Finnish Financial Supervisory Authority. |
--------------------------------------------------------------------------------
| Tier 1 Capital ratio,% |
--------------------------------------------------------------------------------
| Tier 1 capital x 100 |
| Risk-weighted commitments |
--------------------------------------------------------------------------------
| Risk-weighted commitments |
--------------------------------------------------------------------------------
| Assets in the balance sheet plus off-balance sheet items including |
| derivatives valued and risk-weighted in accordance with the standard method |
| set out in regulation 4.3 issued by the Finnish Financial Supervisory |
| Authority. The capital requirements for operative risks have been calculated |
| and risk-weighted in accordance with regulation 4.3i issued by the Finnish |
| Financial Supervisory Authority. |
--------------------------------------------------------------------------------
Notes to the Interim Report
Note 1 Basis for preparing the interim report and important accounting
principles
Basis for preparing the interim report
The Bank Group's financial statement is prepared in accordance with
International Financial Reporting Standards (IFRS) as approved by the EU.
The interim report for the period 1 January - 30 September 2009 has been
prepared in accordance with IAS 34 “Interim Financial Reporting”. The interim
financial report does not contain all the information and notes required for an
annual report and should therefore be read together with the Group's annual
report of 31 December 2008.
The figures in this report are presented so that income statement items are
compared with the corresponding period of the previous year, while the
comparison of balance sheet items relates to 31 December 2008 unless specified
otherwise. Balance sheet items are mainly given in EUR million.
Aktia plc's financial statement and interim reports are available on Aktia's
website www.aktia.fi..
The interim report for the period 1 January - 30 September 2009 was approved by
the Board of Directors on 9 November 2009.
Important accounting principles
In preparing this interim report the Group has, for the most part, followed the
accounting principles applicable to the annual report of 31 December 2008.
In February 2009 Aktia Life Insurance was sold to Aktia plc. The life insurance
business is a separate segment in the Bank Group, which is why Aktia Life
Insurance is to be reported as a discontinued operation in accordance with IFRS
5 as of 2009. Figures provided as a basis for comparison have been adjusted to
correspond with 2009 reporting.
The subsidiaries Aktia Card & Finance Ab, Aktia Corporate Finance Ab and Aktia
Asset Management Oy Ab have certain redemption clauses, and they have been
transferred from minority interests to liabilities in accordance with IAS
32.25(a) as of 31 December 2008. This change in liabilities is reported in the
income statement as personnel costs in 2009.
The accounting principles have also been defined more precisely with regard to
interest-bearing securities. In addition to default, interest-bearing securities
are reviewed individually to assess the need for write-downs in the event that
the price of the security has fallen by more than 50% and the instrument rating
has fallen below investment grade (BB+, Ba1 or lower).
New accounting standards effective from 2009
IAS 1 Presentation of Financial Statements (revised)
This standard has been revised in order to provide better information for
analysing and comparing companies. From 1 January 2009, the Group publishes a
profit and loss statement and a statement of comprehensive income. The change in
the Group's equity includes transactions with owners.
IFRIC 13 Customer Loyalty Programmes
This interpretation deals with reporting on customer loyalty programmes. The
Group had a bonus programme that is to be closed, Aktia Bonus. This bonus scheme
has already been dealt with in the accounts in accordance with IFRIC 13 which is
why the introduction of this standard will not affect the Group's financial
results or standing. Bonus liabilities for the comparison year 2008 have been
moved from other liabilities to accruals.
Note 2 Segment report for Bank Group
--------------------------------------------------------------------------------
| Income | Banking | Asset | Life | Other | Eliminati | Total |
| statement | busines | Managem | Insuran | | ons | Group |
| | s | ent | ce | | | |
--------------------------------------------------------------------------------
| (EUR | 1- | 1- | 1- | 1- | 1- | 1- | 1-9 | 1-9 | 1-9 | 1-9 | 1-9 | 1-9 |
| million) | 9 | 9 | 9 | 9 | 9 | 9 | 200 | 200 | 200 | 200 | 200 | 200 |
| | 20 | 20 | 20 | 20 | 20 | 20 | 9 | 8 | 9 | 8 | 9 | 8 |
| | 09 | 08 | 09 | 08 | 09 | 08 | | | | | | |
--------------------------------------------------------------------------------
| Net | 10 | - | 1. | - | - | - | 2.4 | - | 0.0 | - | 112 | - |
| interest | 8. | | 7 | | | | | | | | .3 | |
| income | 1 | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Dividends | 0. | - | 0. | - | - | - | 1.3 | - | -1. | - | 0.1 | - |
| | 1 | | 0 | | | | | | 3 | | | |
--------------------------------------------------------------------------------
| Net | 17 | - | 9. | - | - | - | 1.2 | - | -0. | - | 27. | - |
| commission | .9 | | 0 | | | | | | 4 | | 7 | |
| income | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Net income | 8. | - | -0 | - | - | - | 0.0 | - | - | - | 8.6 | - |
| from | 8 | | .2 | | | | | | | | | |
| financial | | | | | | | | | | | | |
| transactio | | | | | | | | | | | | |
| ns | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Net income | 0. | - | - | - | - | - | 0.1 | - | -0. | - | 0.1 | - |
| from | 0 | | | | | | | | 1 | | | |
| investment | | | | | | | | | | | | |
| properties | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | 6. | - | 0. | - | - | - | 1.7 | - | -5. | - | 2.3 | - |
| operating | 3 | | 1 | | | | | | 8 | | | |
| income | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Total | 14 | - | 10 | - | 0. | - | 6.8 | - | -7. | - | 151 | - |
| operating | 1. | | .6 | | 0 | | | | 6 | | .1 | |
| income | 3 | | | | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Staff | -2 | - | -5 | - | - | - | -4. | - | 0.1 | - | -33 | - |
| costs | 3. | | .6 | | | | 6 | | | | .9 | |
| | 8 | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | -4 | - | -3 | - | - | - | 6.1 | - | 5.4 | - | -31 | - |
| administra | 0. | | .3 | | | | | | | | .7 | |
| tive | 0 | | | | | | | | | | | |
| expenses | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Depreciati | -1 | - | -0 | - | - | - | -1. | - | - | - | -3. | - |
| on of | .7 | | .6 | | | | 3 | | | | 6 | |
| tangible | | | | | | | | | | | | |
| and | | | | | | | | | | | | |
| intangible | | | | | | | | | | | | |
| assets | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | -7 | - | -0 | - | - | - | -4. | - | 0.4 | - | -12 | - |
| operating | .5 | | .6 | | | | 6 | | | | .3 | |
| expenses | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Total | -7 | - | -1 | - | 0. | - | -4. | - | 5.9 | - | -81 | - |
| operating | 3. | | 0. | | 0 | | 4 | | | | .5 | |
| expenses | 0 | | 1 | | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Write-down | -2 | - | - | - | - | - | - | - | - | - | -25 | - |
| s of | 5. | | | | | | | | | | .9 | |
| credits | 9 | | | | | | | | | | | |
| and other | | | | | | | | | | | | |
| commitment | | | | | | | | | | | | |
| s | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Share of | - | - | - | - | - | - | - | - | 0.7 | - | 0.7 | - |
| profit | | | | | | | | | | | | |
| from | | | | | | | | | | | | |
| associated | | | | | | | | | | | | |
| companies | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Operating | 42 | - | 0. | - | 0. | - | 2.4 | - | -1. | - | 44. | - |
| profit | .4 | | 5 | | 0 | | | | 0 | | 3 | |
| from | | | | | | | | | | | | |
| continuing | | | | | | | | | | | | |
| operations | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Operating | - | - | - | - | -0 | - | - | - | - | - | -0. | - |
| profit for | | | | | .3 | | | | | | 3 | |
| discontinu | | | | | | | | | | | | |
| ed | | | | | | | | | | | | |
| operations | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Operating | 42 | - | 0. | - | -0 | - | 2.4 | - | -1. | - | 44. | - |
| profit | .4 | | 5 | | .3 | | | | 0 | | 0 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance | Banking | Asset | Life | Other | Eliminati | Total |
| sheet | busines | Managem | Insuran | | ons | Group |
| | s | ent | ce | | | |
--------------------------------------------------------------------------------
| (EUR | 30 | 31 | 30 | 31 | 30 | 31 | 30. | 31. | 30. | 31. | 30. | 31. |
| million) | .9 | .1 | .9 | .1 | .9 | .1 | 9.2 | 12. | 9.2 | 12. | 9.2 | 12. |
| | .2 | 2. | .2 | 2. | .2 | 2. | 009 | 200 | 009 | 200 | 009 | 200 |
| | 00 | 20 | 00 | 20 | 00 | 20 | | 8 | | 8 | | 8 |
| | 9 | 08 | 9 | 08 | 9 | 08 | | | | | | |
--------------------------------------------------------------------------------
| Cash and | 26 | 50 | 0. | 0. | - | 13 | - | - | - | -9. | 268 | 506 |
| balances | 8. | 2. | 1 | 1 | | .4 | | | | 7 | .8 | .3 |
| with | 7 | 5 | | | | | | | | | | |
| central | | | | | | | | | | | | |
| banks | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Financial | 3. | 4. | - | - | - | 14 | - | - | - | - | 3.6 | 19. |
| assets | 6 | 5 | | | | .9 | | | | | | 5 |
| reported | | | | | | | | | | | | |
| at fair | | | | | | | | | | | | |
| value | | | | | | | | | | | | |
| through | | | | | | | | | | | | |
| profit and | | | | | | | | | | | | |
| loss | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Financial | 2, | 2, | 6. | 13 | - | 64 | 24. | 19. | -2. | -15 | 2,7 | 3,0 |
| assets | 68 | 35 | 9 | .2 | | 8. | 0 | 0 | 2 | .8 | 15. | 19. |
| available | 6. | 4. | | | | 6 | | | | | 4 | 9 |
| for sale | 7 | 9 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Loans and | 6, | 5, | 27 | 17 | - | - | - | - | -2. | -5. | 6,1 | 5,5 |
| other | 10 | 52 | .9 | .6 | | | | | 9 | 7 | 28. | 32. |
| receivable | 3. | 0. | | | | | | | | | 6 | 2 |
| s | 6 | 3 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Investment | - | - | - | - | - | 14 | - | - | - | - | - | 148 |
| s for | | | | | | 8. | | | | | | .1 |
| unit-linke | | | | | | 1 | | | | | | |
| d | | | | | | | | | | | | |
| provisions | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | 88 | 46 | 4. | 7. | - | 21 | -26 | -99 | -35 | -10 | 598 | 293 |
| assets | 9. | 5. | 5 | 2 | | .5 | 0.3 | .3 | .1 | 0.8 | .7 | .9 |
| | 7 | 3 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Total | 9, | 8, | 39 | 38 | 0. | 84 | -23 | -80 | -40 | -13 | 9,7 | 9,5 |
| assets | 95 | 84 | .5 | .1 | 0 | 6. | 6.3 | .3 | .3 | 2.1 | 15. | 19. |
| | 2. | 7. | | | | 6 | | | | | 1 | 9 |
| | 3 | 5 | | | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Deposits | 4, | 4, | 15 | 13 | - | - | - | - | -2. | -13 | 4,8 | 5,0 |
| | 65 | 89 | 3. | 0. | | | | | 9 | .6 | 01. | 16. |
| | 1. | 9. | 0 | 1 | | | | | | | 8 | 0 |
| | 6 | 4 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Debt | 2, | 2, | - | - | - | - | - | - | -2. | -15 | 2,6 | 2,1 |
| securities | 64 | 13 | | | | | | | 2 | .3 | 38. | 18. |
| issued | 0. | 4. | | | | | | | | | 5 | 7 |
| | 7 | 1 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Technical | - | - | - | - | - | 77 | - | - | - | - | - | 777 |
| provision | | | | | | 7. | | | | | | .2 |
| for life | | | | | | 2 | | | | | | |
| insurance | | | | | | | | | | | | |
| business | | | | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | 1, | 1, | 5. | 15 | - | 11 | 251 | 219 | -10 | -11 | 1,8 | 1,3 |
| liabilitie | 74 | 17 | 2 | .9 | | .1 | .3 | .8 | 0.1 | 2.3 | 99. | 07. |
| s | 3. | 3. | | | | | | | | | 6 | 8 |
| | 3 | 2 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Total | 9, | 8, | 15 | 14 | 0. | 78 | 251 | 219 | -10 | -14 | 9,3 | 9,2 |
| liabilitie | 03 | 20 | 8. | 6. | 0 | 8. | .3 | .8 | 5.3 | 1.2 | 39. | 19. |
| s | 5. | 6. | 2 | 1 | | 3 | | | | | 9 | 7 |
| | 6 | 7 | | | | | | | | | | |
--------------------------------------------------------------------------------
Note 3 Derivatives and off-balance sheet commitments
Derivative instruments at 30 September 2009 (EUR million)
--------------------------------------------------------------------------------
| Hedging derivative instruments | Total, | Assets, | Liabiliti |
| | nominal | fair | es, fair |
| | amount | value | value |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Fair value hedging | | | |
--------------------------------------------------------------------------------
| Interest rate-related | 2,079.5 | 55.7 | 21.7 |
--------------------------------------------------------------------------------
| Total | 2,079.5 | 55.7 | 21.7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow hedging | | | |
--------------------------------------------------------------------------------
| Interest rate-related | 960.0 | 42.8 | 0.9 |
--------------------------------------------------------------------------------
| Total | 960.0 | 42.8 | 0.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Derivative instruments valued through | | | |
| income statement | | | |
--------------------------------------------------------------------------------
| Interest rate-related *) | 7,059.1 | 117.8 | 116.5 |
--------------------------------------------------------------------------------
| Currency-related | 182.3 | 0.5 | 0.4 |
--------------------------------------------------------------------------------
| Equity-related **) | 106.4 | 1.8 | 1.8 |
--------------------------------------------------------------------------------
| Other derivative instruments **) | 6.4 | 0.3 | 0.3 |
--------------------------------------------------------------------------------
| Total | 7,354.2 | 120.4 | 119.0 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total derivative instruments | | | |
--------------------------------------------------------------------------------
| Interest rate-related | 10,098.6 | 216.3 | 139.1 |
--------------------------------------------------------------------------------
| Currency-related | 182.2 | 0.5 | 0.4 |
--------------------------------------------------------------------------------
| Equity-related | 106.4 | 1.8 | 1.8 |
--------------------------------------------------------------------------------
| Other derivative instruments | 6.4 | 0.3 | 0.3 |
--------------------------------------------------------------------------------
| Total | 10,393.7 | 218.9 | 141.6 |
--------------------------------------------------------------------------------
*) Interest-linked derivatives include interest rate hedging provided for local
banks which after back-to-back hedging with third parties amounted to EUR 6
752,6 million.
**) All equity-related and other derivative instruments relate to the hedging of
structured debt products.
Off-balance sheet commitments
--------------------------------------------------------------------------------
| (EUR million) | 30.9.20 | 31.12.20 | 30.9.200 |
| | 09 | 08 | 8 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Commitments provided to a third party on | | | |
| behalf of customers | | | |
--------------------------------------------------------------------------------
| Guarantees | 51.6 | 54.8 | - |
--------------------------------------------------------------------------------
| Other commitments provided to a third party | 7.4 | 7.5 | - |
--------------------------------------------------------------------------------
| Irrevocable commitments provided on behalf | | | |
| of customers | | | |
--------------------------------------------------------------------------------
| Unused credit arrangements | 550.8 | 459.1 | - |
--------------------------------------------------------------------------------
| Other irrevocable commitments *) | - | 12.1 | - |
--------------------------------------------------------------------------------
| Off-balance sheet commitments | 609.8 | 533.5 | - |
--------------------------------------------------------------------------------
| *) Credit equivalents for derivatives are not included in off-balance sheet |
| commitments as their market values are included in the balance sheet. |
--------------------------------------------------------------------------------
Note 4 Risk exposure for Bank Group
Consolidated capital adequacy for Bank Group
--------------------------------------------------------------------------------
| Summary (EUR million) | 30.9.200 | 31.12.200 | 30.9.2008 |
| | 9 | 8 | |
--------------------------------------------------------------------------------
| Tier 1 capital | 324.5 | 309.0 | - |
--------------------------------------------------------------------------------
| Tier 2 capital | 222.2 | 143.4 | - |
--------------------------------------------------------------------------------
| Capital base | 546.7 | 452.4 | - |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Risk-weighted amount for credit and | 3,220.7 | 3,040.5 | - |
| counterpart risks | | | |
--------------------------------------------------------------------------------
| Risk-weighted amount for market risks 1) | - | - | - |
--------------------------------------------------------------------------------
| Risk-weighted amount for operational | 272.7 | 272.7 | - |
| risks 2) | | | |
--------------------------------------------------------------------------------
| Total risk-weighted commitments | 3,493.4 | 3,313.2 | - |
--------------------------------------------------------------------------------
| Capital adequacy ratio,% | 15.7 | 13.7 | - |
--------------------------------------------------------------------------------
| Tier 1 capital ratio,% | 9.3 | 9.3 | - |
--------------------------------------------------------------------------------
| Minimum capital requirement | 279.5 | 265.1 | - |
--------------------------------------------------------------------------------
| Capital buffer (difference between | 267.3 | 187.3 | - |
| capital base and minimum requirement) | | | |
--------------------------------------------------------------------------------
1) No capital requirement due to minor trading book and when total of net
currency items are less than 2% of capital base.
2) The capital requirement of 15% is calculated using the definition of average
gross income during the last three years (EUR 145,4 million) x risk-weighted
factor of 12.5.
--------------------------------------------------------------------------------
| Capital base (EUR million) | 30.9.200 | 31.12.200 | 30.9.2008 |
| | 9 | 8 | |
--------------------------------------------------------------------------------
| Share capital | 163.0 | 163.0 | - |
--------------------------------------------------------------------------------
| Funds | 44.6 | 44.6 | - |
--------------------------------------------------------------------------------
| Minority share | 30.0 | 24.9 | - |
--------------------------------------------------------------------------------
| Retained earnings | 70.7 | 93.5 | - |
--------------------------------------------------------------------------------
| Profit for the reporting period | 31.4 | 9.2 | - |
--------------------------------------------------------------------------------
| ./. provision for dividends to | -7.5 | -0.6 | - |
| shareholders | | | |
--------------------------------------------------------------------------------
| Total | 332.1 | 334.7 | - |
--------------------------------------------------------------------------------
| ./. intangible assets | -7.5 | -8.6 | - |
--------------------------------------------------------------------------------
| ./. shares in insurance companies | - | -17.1 | - |
--------------------------------------------------------------------------------
| Tier 1 capital | 324.5 | 309.0 | - |
--------------------------------------------------------------------------------
| Fund at fair value | 14.9 | -47.5 | - |
--------------------------------------------------------------------------------
| Other Tier 2 capital | 45.0 | 45.0 | - |
--------------------------------------------------------------------------------
| Risk debentures | 162.3 | 163.0 | - |
--------------------------------------------------------------------------------
| ./. shares in insurance companies | - | -17.1 | - |
--------------------------------------------------------------------------------
| Tier 2 capital | 222.2 | 143.4 | - |
--------------------------------------------------------------------------------
| Total capital base | 546.7 | 452.4 | - |
--------------------------------------------------------------------------------
Risk-weighted commitments, credit and counterparty risks
--------------------------------------------------------------------------------
| (EUR million) | | | | Risk-weighted commitments, |
| | | | | Basel 2 |
--------------------------------------------------------------------------------
| Risk weighting | Balanc | Off-bal | Total | 30.9.20 | 31.12.2 | 30.9.200 |
| | e | ance | | 09 | 008 | 8 |
| | assets | sheet | | | | |
| | | commit- | | | | |
| | | ments | | | | |
--------------------------------------------------------------------------------
| 0% | 1,045. | 26.3 | 1,071.3 | - | - | - |
| | 1 | | | | | |
--------------------------------------------------------------------------------
| 10% | 1,113. | - | 1,113.5 | 111.3 | 80.3 | - |
| | 5 | | | | | |
--------------------------------------------------------------------------------
| 20% | 1,651. | 281.1 | 1,932.3 | 341.9 | 335.3 | - |
| | 3 | | | | | |
--------------------------------------------------------------------------------
| 35% | 4,437. | 120.0 | 4,557.3 | 1,567.2 | 1,421.4 | - |
| | 3 | | | | | |
--------------------------------------------------------------------------------
| 50% | 9.4 | 0.6 | 10.0 | 4.8 | 2.5 | - |
--------------------------------------------------------------------------------
| 75% | 575.9 | 79.5 | 655.4 | 457.8 | 426.7 | - |
--------------------------------------------------------------------------------
| 100% | 642.0 | 101.2 | 743.2 | 694.0 | 720.8 | - |
--------------------------------------------------------------------------------
| 150% | 14.3 | 1.3 | 15.6 | 22.4 | 11.3 | - |
--------------------------------------------------------------------------------
| Total | 9,488. | 609.8 | 10,098. | 3,199.6 | 2,998.4 | - |
| | 7 | | 5 | | | |
--------------------------------------------------------------------------------
| Derivatives *) | - | 254.7 | 254.7 | 21.1 | 42.1 | - |
--------------------------------------------------------------------------------
| Total | 9,488. | 864.5 | 10,353. | 3,220.7 | 3,040.5 | - |
| | 7 | | 2 | | | |
--------------------------------------------------------------------------------
| *) derivative agreements credit conversion factor |
--------------------------------------------------------------------------------
Risk-weighted amounts for operational risks
--------------------------------------------------------------------------------
| | Risk-weighted amount, Basel |
| | 2 |
--------------------------------------------------------------------------------
| Year | 2006 | 2007 | 2008 | 30.9.20 | 31.12.2 | 30.9.200 |
| | | | | 09 | 008 | 8 |
--------------------------------------------------------------------------------
| Gross income | 140.6 | 145.2 | 150.5 | | | |
--------------------------------------------------------------------------------
| - average 3 | | | 145.4 | | | |
| years | | | | | | |
--------------------------------------------------------------------------------
| Indicator 15% | | | 21.8 | | | |
--------------------------------------------------------------------------------
| Capital requirement for | | 21.8 | 272.7 | 272.7 | - |
| operational risk | | | | | |
--------------------------------------------------------------------------------
Helsinki, 9 November 2009
Aktia Bank Plc
Board of Directors
Review report on the interim report of Aktia Bank P.l.c. as of 30.9.2009
To the Board of Directors of Aktia Bank p.l.c.
Introduction
We have reviewed the balance sheet as of 30.9.2009, the income statement, the
statement of changes in equity and the cash flow statement of Aktia Bank p.l.c.
for the nine-month period then ended, as well as a summary of significant
accounting policies and other explanatory notes to the financial statements. The
Board of Directors and the Managing Director are responsible for the preparation
and fair presentation of this interim financial information in accordance with
the International Financial Reporting Standards (IFRS), as adopted by the EU,
and other Finnish rules and regulations governing the preparation of interim
reports. At the request of the Board of Directors we issue our opinion on the
interim report.
Scope of review
We conducted our review in accordance with the Standard on Review Engagements
2410, Review of Interim Financial Information Performed by the Independent
Auditor of the Entity. A review of interim financial information consists of
making inquiries, primarily of persons responsible for financial accounting
matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with the
standards on auditing and other generally accepted auditing practices, and
therefore the procedures performed in a review do not enable to obtain a level
of assurance that would make us aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit opinion.
Opinion
Based on our review, nothing has come to our attention that causes us to believe
that the Interim Report does not give a true and fair view of the entity's
financial position as of 30 September 2009 and the result of its operations and
cash flows for the nine-month period then ended, in accordance with the
International Financial Reporting Standards (IFRS), as adopted by the EU and
other applicable rules and regulations governing interim financial reporting
preparation in Finland.
Helsinki, 9 November 2009
PricewaterhouseCoopers Oy
Authorised Public Accountants
Jan Holmberg
Authorised Public Accountant
AKTIA BANK PLC
For more details, please contact:
Deputy Managing Director Stefan Björkman, tel. +358 10 247 6595
From:
Anna Gabrán, Investor Relations Officer, tel. +358 10 247 6501
Distribution:
Nasdaq OMX Helsinki
Central media
www.aktia.fi
