Aktia Bank plc: Agreement on Aquisition of minority shares in Aktia REMB by Aktia Bank and subsequent merger
Stock Exchange Release
Aktia Bank plc
8.10.2015 at 10:30 a.m.
AGREEMENT ON ACQUISITION OF MINORITY SHARES IN AKTIA REAL ESTATE MORTGAGE BANK BY AKTIA BANK AND SUBSEQUENT MERGER
Following an agreement with the minority owners of Aktia Bank plc's subsidiary Aktia Real Estate Mortgage Bank plc signed today, Aktia Bank plc will purchase the minority shareholders’ shares in Aktia Real Estate Mortgage Bank plc and subsequently merge Aktia Real Estate Mortgage Bank with Aktia Bank. Prior to the acquisition, the parties aim to further reduce the balance sheet total of Aktia Real Estate Mortgage Bank. Hence the acquisition of shares will not take place until the financial statements of Aktia Real Estate Mortgage Bank for 2016 have been completed.
Aktia Real Estate Mortgage Bank ceased to grant new loans in 2012 (see Stock Exchange Releases 12 September 2012 from Aktia Bank and Aktia Real Estate Mortgage Bank). The today signed agreement terminates the co-operation between Aktia Bank and Savings banks and POP Banks in refinancing through covered bonds.
Both the acquisition and the merger support implementation of "Action Plan 2015" with the objective to, for example, enhance Aktia Bank's Group structure (see Stock Exchange Release 11 November 2012 from Aktia Bank).
Following the agreement, the minority interest's share of equity (non-controlling interest) in Aktia Real Estate Mortgage Bank is reclassified from Equity to Other liabilities. The effect on key figures for Aktia in Q3 and Q4 2015 will be:
- The Group's equity will decrease by approximately EUR 65 million, but this will have no effect on Aktia's shareholders share of equity (as of Q4 2015).
- Aktia's Return on equity (ROE) will improve by approximately 0.5 percentage points (as of Q4 2015).
- Aktia's Common Equity Tier 1 capital ratio (CET1 30 June 2015;22.4%) will decrease temporarily by approximately 2 percentage points and increase again concurrently with savings banks and POP Banks repurchasing their respective shares of Aktia Real Estate Mortgage Bank's loan book (as of Q3 2015).
The acquisition of minority shares in Aktia Real Estate Mortgage Bank will have no effect on Aktia's result, but possible premature repayment of liabilities of Aktia Real Estate Mortgage Bank may, considering the current interest level, cause certain one-off costs for the Group in 2016.
AKTIA BANK PLC
Jussi Laitinen, CEO, tel. +358 10 247 6250
Nasdaq Helsinki Oy,
Aktia provides a broad range of products within banking, insurance and real estate agency. Aktia operates in Finland's coastal areas and inland growth areas. Aktia has some 300,000 customers who are served by 900 employees at 50 branch offices and via Internet and telephone services. Aktia's shares are listed on NASDAQ OMX Helsinki Ltd. For more information about Aktia, see www.aktia.com