Aktia Bank plc: Aktia Bank plc’s financial position and profit for the period 1 January - 31 March 2013

 

Aktia Bank plc
Stock Exchange Release
7 May 2013 at 8:00 a.m.

 

Aktia Bank plc’s financial position and profit for the period 1 January - 31 March 2013

Aktia Bank plc publishes information on the bank’s financial performance and financial position as the parent company of the bank, Aktia plc, publishes its Interim Report for the period 1 January - 31 March 2013. The information published is not an Interim Report as stipulated in the Securities Markets Act.

On 9 April 2013, the shareholder of Aktia Bank plc approved the merger of Aktia plc with Aktia Bank plc. The planned effective date of the merger is 1 July 2013.

All information concerns Aktia Bank Group unless specified otherwise.

 

Key figures            
(EUR million) 1-3/ 2013 1-3/ 2012 ∆ % 10-12/ 2012 ∆ % 2012
Earnings per share (EPS) 3.9 2.9 33% -0.6 - 7.8
Equity per share (NAV)   1) 134.9 130.9 3% 141.3 -4% 141.3
Return on equity (ROE), % 9.8 8.8 11% -1.4 - 5.6
Total earnings per share 2.7 14.5 -82% 1.4 98% 31.6
             
Number of shares at the end of the period   1) 3 3 0% 3 0% 3
Personnel (FTEs), average number of employees from the beginning of the financial year   1) 750 771 -3% 753 0% 753
Banking Business            
Cost-to-income ratio 0.67 0.68 -1% 0.89 -25% 0.74
             
Borrowing from the public   1) 3,703.4 3,700.8 0% 3,651.4 1% 3,651.4
Lending to the public   1) 7,179.1 7,239.5 -1% 7,248.1 -1% 7,248.1
             
Capital adequacy ratio, %   1) 20.0 18.1 11% 20.2 -1% 20.2
Tier 1 capital ratio, %   1) 11.7 11.3 3% 11.8 -1% 11.8
Risk-weighted commitments   1) 3,683.7 3,767.3 -2% 3,611.2 2% 3,611.2
             
Asset Management (incl. Private Banking)            
Assets under management   1) *) 6,141.0 5,334.0 15% 5,804.5 6% 5,804.5
             
 1) At the end of the period
  *) Assets under management = Aktia Fund Management Company’s assets under management and brokered mutual funds and assets managed by Aktia Invest, Aktia Asset Management and Aktia Bank’s Private Banking
 

Formulas for key figures are presented in Aktia Bank plc’s Annual Report 2012 on page 9.

 

Consolidated income statement for Bank Group    
(EUR million) 1-3/2013 1-3/2012 ∆ % 2012
Net interest income 29.8 29.5 1% 116.5
Dividends 0.0 0.0 -99% 0.1
     Commission income 20.4 18.7 9% 76.7
     Commission expenses -4.6 -4.3 -6% -17.1
Net commission income 15.8 14.4 10% 59.6
Net income from financial transactions 2.2 0.3 668% 2.9
Net income from investment properties 0.0 0.0 -50% -0.3
Other operating income 0.9 1.5 -44% 4.7
Total operating income 48.7 45.7 7% 183.4
         
Staff costs -13.3 -13.2 1% -52.7
IT-expenses -4.8 -4.9 -2% -26.4
Depreciation of tangible and intangible assets -0.7 -0.8 -21% -3.4
Other operating expenses -13.7 -12.4 11% -53.5
Total operating expenses -32.4 -31.3 4% -136.0
         
Write-down on other financial assets - - - -1.8
Write-down on credits and other commitments -1.1 -1.9 -41% -6.4
Share of profit from associated companies 0.3 -0.1 - -0.4
Operating profit 15.4 12.4 24% 38.8
Income and expenses from other activities - - - -3.1
Taxes -3.7 -3.4 10% -11.4
Profit for the period 11.7 9.1 29% 24.3
         
Attributable to:        
Shareholders in Aktia Bank plc 11.7 8.8 33% 23.4
Non-controlling interest 0.0 0.3 - 0.8
Total 11.7 9.1 29% 24.3
         
Earnings per share (EPS), EUR 3,910,002.45 2,930,530.55 33% 7,814,312.31
There is no dilution effect to earnings per share        

  

Consolidated statement of comprehensive income for Bank Group        
(EUR million) 1-3/2013 1-3/2012 ∆ %      2012
         
Profit for the period 11.7 9.1 29% 24.3
Other comprehensive income after taxes:        
Change in valuation of fair value for financial assets available for sale -0.4 38.0 - 66.6
Change in valuation of fair value for cash flow hedging -2.9 -3.0 1% -3.3
Transferred to the income statement for financial assets available for sale - - - 14.0
Transferred to the income statement for cash flow hedging - - - -5.8
Comprehensive income from items which can be transferred to the income statement -3.3 35.1 - 71.6
Defined benefit plan pensions - - - 0.0
Comprehensive income from items which can not be transferred to the income statement - - - 0.0
Total comprehensive income for the period 8.4 44.1 -81% 95.9
         
Total comprehensive income attributable to:        
Shareholders in Aktia Bank plc 8.1 43.6 -82% 94.7
Non-controlling interest 0.3 0.5 -41% 1.2
Total 8.4 44.1 -81% 95.9
         
Total earnings per share, EUR 2,684,633.89 14,534,035.15 -82% 31,556,571.18
There is no dilution effect to the total earnings per share        

 

 

Consolidated balance sheet for Bank Group  
(EUR million) 31.3.2013 31.12.2012 ∆ % 31.3.2012
Assets        
Cash and balances with central banks 293.7 585.9 -50% 219.6
Interest-bearing securities 1,645.4 1,468.0 12% 2.052.1
Shares and participations 5.9 6.1 -4% 1.8
Financial assets available for sale 1,651.3 1,474.2 12% 2.053.9
Financial assets held until maturity 362.5 350.0 4% 19.3
Derivative instruments 270.8 302.2 -10% 309.3
Lending to Bank of Finland and credit institutions 129.0 158.7 -19% 131.0
Lending to the public and public sector entities 7,179.1 7,248.1 -1% 7.239.5
Loans and other receivables 7,308.1 7,406.7 -1% 7.370.5
Investments in associated companies 0.9 0.8 1% 3.0
Intangible assets 2.2 2.0 11% 2.2
Investment properties 0.5 0.5 0% 0.7
Other tangible assets 4.2 4.4 -4% 4.9
Accured income and advance payments 61.2 64.2 -5% 74.2
Other assets 123.5 2.1 - 39.9
Total other assets 184.7 66.3 179% 114.0
Income tax receivables 0.7 0.1 543% 3.4
Deferred tax receivables 21.5 22.7 -5% 1.8
Tax receivables 22.2 22.8 -3% 5.2
Total assets 10,101.0 10,215.8 -1% 10.102.6
         
Liabilities        
Liabilities to credit institutions 983.5 1,057.6 -7% 977.1
Liabilities to the public and public sector entities 3,703.4 3,651.4 1% 3.700.8
Deposits 4,686.9 4,709.0 0% 4.677.9
Derivative instruments 161.6 186.4 -13% 163.2
Debt securities issued 3,559.5 3,547.6 0% 3.770.4
Subordinated liabilities 304.2 298.2 2% 281.6
Other liabilities to credit institutions 586.6 629.6 -7% 486.0
Other liabilities to the public and public sector entities 128.7 146.7 -12% 65.1
Other financial liabilitites 4,579.1 4,622.1 -1% 4.603.2
Accured expenses and income received in advance 98.1 88.6 11% 116.1
Other liabilities 32.1 48.5 -34% 59.6
Total other liabilities 130.2 137.1 -5% 175.7
Provisions 6.9 6.9 0% -
Income tax liabilities 20.0 19.7 2% 0.1
Deferred tax liabilities 46.4 46.1 1% 31.6
Tax liabilities 66.4 65.7 1% 31.7
Total liabilities 9,631.1 9,727.2 -1% 9.651.7
         

Equity
       
Restricted equity 221.2 224.8 -2% 188.5
Unrestricted equity 183.7 198.9 -8% 204.3
   Shareholders’  share of equity 404.8 423.8 -4% 392.7
   Non-controlling interest’s share of equity 65.1 64.8 0% 58.3
Equity 469.9 488.6 -4% 451.0
Total liabilities and equity 10,101.0 10,215.8 -1% 10.102.6

 

 

Consolidated statement of changes in equity for Bank Group      
                 
                 
                 
          Shareholders' Non-controlling    
    Fund at Unrestricted Retained share of interest's share Total  
(EUR million)    Share capital fair value equity reserve earnings equity of equity equity  
Equity as at 1January 2012 163,0 -9,4 44,6 120,9 319,1 57,7 376,8  
   Profit for the period       8,8 8,8 0,3 9,1  
   Financial assets available for sale 37,9     37,9 0,2 38,0  
   Cash flow hedging   -3,1     -3,1 0,1 -3,0  
Total comprehensive income for the period 34,8   8,8 43,6 0,5 44,1  
Other change in equity     30,0   30,0 0,0 30,0  
Equity as at 31 March 2012 163,0 25,5 74,6 129,7 392,7 58,3 451,0  
                 
                 
Equity as at 1January 2013 163,0 61,8 74,6 124,4 423,8 64,8 488,6  
Dividends to shareholders       -27,0 -27,0   -27,0  
   Profit for the period       11,7 11,7 0,0 11,7  
   Financial assets available for sale -0,4     -0,4 0,0 -0,4  
   Cash flow hedging   -3,3     -3,3 0,3 -2,9  
Total comprehensive income for the period -3,7   11,7 8,1 0,3 8,4  
Other change in equity         0,0 0,0 0,0  
Equity as at 31 March 2013 163,0 58,2 74,6 109,1 404,8 65,1 469,9  

 

 

Consolidated cash flow statement for Bank Group  
(EUR million) 1-3/2013 1-3/2012 ∆  %    2012
Cash flow from operating activities        
Operating profit 15.4 12.4 24% 38.8
Adjustment items not included in cash flow for the period -4.8 5.5 - 0.8
Unwound cash flow hedging - 6.7 - 17.5
Unwound fair value hedging - - - 92.1
Paid income taxes -1.3 16.9 - 13.5
Cash flow from operating activities before change in receivables and liabilities        
9.3 41.6 -78% 162.7
Increase (-) or decrease (+) in receivables from operating activities -208.9 -329.7 37% -15.4
Increase (+) or decrease  (-) in liabilities from operating activities -59.3 22.7 - -54.3
Total cash flow from operating activities -258.8 -265.4 2% 93.0
Cash flow from investing activities        
Financial assets held until maturity -14.2 0.7 - 9.9
Proceeds from sale of group companies and associated companies - - - 0.0
Investment in tangible and intangible assets -0.9 -0.3 -165% -2.4
Disposal of tangible and intangible assets 0.1 0.0 852% 0.1
Total cash flow from investing activities -15.0 0.4 - 7.6
Cash flow from financing activities        
Subordinated liabilities 6.0 -7.1 - 11.1
Increase in unrestricted equity reserve - 30.0 - 30.0
Share issue / dividend of Aktia Real Estate Mortgage Bank plc to the non-controlling interest - - - 5.9
Paid dividends -27.0 - - -20.0
Total cash flow from financing activities -21.0 22.9 - 27.0
Change in cash and cash equivalents -294.8 -242.1 -22% 127.6
Cash and cash equivalents at the beginning of the year 600.5 473.0 27% 473.0
Cash and cash equivalents at the end of the period 305.7 230.8 32% 600.5
Cash and cash equivalents in the cash flow statement consist of the following items:        
Cash in hand 6.7 8.1 -18% 8.0
Bank of Finland current account 287.0 211.5 36% 577.9
Repayable on demand claims on credit institutions 12.1 11.2 8% 14.6
Total 305.7 230.8 32% 600.5
Adjustment items not included in cash flow consist of:        
Impairment reversal of financial assets available for sale - - - -1.2
Write-downs on other financial assets - - - 1.8
Write-downs on credits and other commitments 1.1 1.9 -41% 6.4
Change in fair values 1.2 2.3 -47% -4.6
Depreciation and impairment of intangible and tangible assets 0.7 0.8 -21% 3.4
Share of profit from associated companies 0.0 0.5 - 0.8
Sales gains and losses from intangible and tangible assets 0.1 0.0 - 0.2
Unwound cash flow hedging -3.9 - - -11.7
Unwound fair value hedging -3.9 - - -1.3
Change in provisions - - - 6.9
Change in fair values of investment properties - - - 0.3
Total -4.8 5.5 - 0.8

 

The segments’ operating profit

The Bank Group has three segments; Banking Business, Asset Management and Miscellaneous.

Banking Business comprises Aktia Bank plc’s branch office and corporate functions as well as Treasury and the subsidiaries Aktia Real Estate Mortgage Bank plc and Aktia Corporate Finance Ltd.

Asset Management comprises Aktia Bank plc’s Private Banking and the subsidiaries Aktia Asset Management Ltd, Aktia Fund Management Company Ltd and Aktia Invest Ltd.

Miscellaneous comprises administration of Aktia Bank plc and return on equity.

Aktia plc, the parent company of Aktia Bank plc, has changed its division into business segments as of 1 January 2013. Following the merger on 1 July 2013, Aktia Bank plc will, as new parent company of the Aktia Group, apply corresponding segment structure, comprising the segments Banking Business, Asset Management & Life Insurance and Miscellaneous.

Operating profit

(EUR million) 1-3/2013 1-3/2012 ∆  %   
Banking Business      14.6 11.4 28%
Asset Management      2.9 2.3 25%
Miscellaneous               -2.2 -0.5 -321%
Eliminations       0.1 -0.8 -
Total 15.4 12.4 24%

 

Net interest income

(EUR million) 1-3/2013 1-3/2012 ∆ % 2012
Deposits and lending 10.4 15.3 -32% 55.1
Hedging, interest rate risk management 11.1 7.2 54% 30.8
Other 8.3 7.0 19% 30.6
Net interets income 29.8 29.5 1% 116.5
         

 

The impact of fixed rate investment is divided into two components consisting of interest rate risk and credit risk.  The interest rate risk component is included in Hedging of interest rate risk whereas the credit risk component is booked as a part of Other net interest income.

 

Credit stock

 Chart 1. Credit stock by sector

(EUR million) 31.3.2013 31.12.2012 ∆  Share, %
Households 6,177 6,222 -45 86.0%
Corporate 696 713 -17 9.7%
Housing associations 264 270 -7 3.7%
Non-profit organisations 39 39 0 0.5%
Public sector entities 4 4 0 0.1%
Total 7,179 7,248 -69 100.0%

 

 

Chart 2. Cross loans and write-downs
(EUR million)
31.3.2013 31.12.2012 30.9.2012 30.6.2012 31.3.2012
Gross loans 7,245 7,313 7,365 7,334 7,303
Individual write-downs -51 -50 -48 -50 -50
       Of which made to non-performing loans past due at least 90 days -41 -40 -39 -42 -43
       Of which made to other loans -9 -10 -8 -8 -7
Write-downs by group -15 -15 -16 -14 -14
Net loans, balance amount 7,179 7,248 7,301 7,270 7,240
           

 

Total write-downs on credits amounted to 0.02 (0.03)% of total lending for the period. The corresponding impact on corporate loans amounted to

0.2 (0.2)% of the total corporate lending.

Chart 3. Undischarged debts by time overdue

(EUR million)
Days
31.3.2013 % of stock 31.12.2012 % of stock
3-30 137 1.90 133 1,83
of which households 119 1.65 117 1,61
         
31-89 49 0.68 51 0,71
of which households 36 0.50 42 0,58
         
90- * 45 0.63 50 0,68
of which households 30 0.42 33 0,45

 

 

  * in Aktia Bank, fair value of collateral covers 96% of debts

Specification of the fund at fair value

(EUR million)   31.3.2013 31.12.2012
Shares and participations 3.6 3.6 0.0
Direct interest-bearing securities 41.6 42.0 -0.4
Cash flow hedging 13.0 16.2 -3.3
Fund at fair value, total 58.2 61.9 -3.7

 

 

The Bank Group’s liquidity portfolio

The Bank Group’s liquidity portfolio and other interest-bearing investments

Aktia Bank Group Goverment and Govt. quaranteed Covered Bonds (CB) Financial institutions exkl. CB Corporate bonds Real estate Alternative investments Listed Equity Total
  3/13 2012 3/13 2012 3/13 2012 3/13 2012 3/13 2012 3/13 2012 3/13 2012 3/13 2012
EU AAA 62 75 826 798 287 226 56 - - - - - - - 1,280 1,098
Finland 46 59 116 117 92 43 56 - - - - - - - 310 218
Other AAA-countries 16 16 710 681 244 182 - - - - - - - - 971 880
EU < AAA - - 349 443 60 5 - - - - - - - - 409 448
France *) - - 291 270 60 5 - - - - - - - - 351 275
Belgium - - - - - - - - - - - - - - - -
Greece - - - - - - - - - - - - - - - -
Ireland - - 10 16 - - - - - - - - - - 10 16
Italy - - 48 47 - - - - - - - - - - 48 47
Portugal - - - 56 - - - - - - - - - - - 56
Spain - - - 54 - - - - - - - - - - - 54
Other countries - - - - - - - - - - - - - - - -
Europe excluding EU - - 214 238 17 20 - - - - - - - - 231 258
North America - - 12 12   - - - - - - - - - 12 12
Other OECD-countries - - - -   - - - - - - - - - - -
Supernationals - - - - 111 45 - - - - - - - - 111 45
Others - - - - - - - - - - - - - - - -
Total 62 75 1,401 1,490 524 297 56 - - - - - - - 2,043 1,862

* France fell below AAA during 2012

 

Rating distribution for banking business’ liquidity portfolio

  31.3.2013 31.12.2012
(EUR million) 2,043 1,862
Aaa 59.9% 64.5%
Aa1-Aa3 19.5% 19.1%
A1-A3 15.9% 8.9%
Baa1-Baa3 0.8% 3.7%
Ba1-Ba3 0.5% 1.5%
B1-B3 0.0% 0.0%
Caa1 or lower 0.0% 0.0%
Finnish municipalities (unrated) 1.4% 2.2%
No rating 2.1% 0.0%
Total 100.0% 100.0%
 

 

The Bank Group’s capital adequacy

Capital adequacy 31.3.2013 31.12.2012
Bank Group    
Capital adequacy 20.0% 20.2%
Tier 1 ratio 11.7% 11.8%
Aktia Bank    
Capital adequacy 26.9% 28.1%
Tier 1 ratio 15.5% 16.1%
Aktia Real Estate Mortgage Bank    
Capital adequacy 11.7% 11.3%
Tier 1 ratio 10.1% 9.7%

 

 

Risk exposures for Bank Group
           
Consolidated capital adequacy for Bank Group          
Summary (EUR million) 3/2013 12/2012 9/2012 6/2012 3/2012
Tier 1 capital 432.0 426.4 440.4 437.9 427.1
Tier 2 capital 306.2 303.8 302.1 268.0 254.5
Capital base 738.2 730.2 742.5 705.9 681.6
Risk-weighted amount for credit and counterpart risks 3,321.4 3,248.9 3,355.6 3,369.6 3,395.0
Risk-weighted amount for market risks  1) - - - - -
Risk-weighted amount for operational risks 362.3 362.3 372.3 372.3 372.3
Risk-weighted commitments 3,683.7 3,611.2 3,727.9 3,742.0 3,767.3
Capital adequacy ratio, % 20.0 20.2 19.9 18.9 18.1
Tier 1 Capital ratio, % 11.7 11.8 11.8 11.7 11.3
Minimum capital requirement 294.7 288.9 298.2 299.4 301.4
Capital buffer (difference between capital base and minimum requirement) 443.5 441.3 444.3 406.5 380.2
1) No capital requirement due to minor trading book and when total of net currency positions are less than 2% of capital base.

 

(EUR million) 3/2013 12/2012 9/2012 6/2012 3/2012
Share capital 163.0 163.0 163.0 163.0 163.0
Funds 74.6 74.6 74.6 74.6 74.5
Non-controlling interest 65.1 64.8 64.8 64.0 58.3
Retained earnings 96.0 100.9 100.9 100.9 100.0
Profit for the period 11.7 23.4 25.3 18.4 8.8
 ./. provision for dividends to shareholders -6.2 -28.3 -15.9 -10.6 -5.3
Capital loan 30.0 30.0 30.0 30.0 30.0
Total 434.2 428.4 442.8 440.3 429.3
 ./. intangible assets -2.2 -2.0 -2.3 -2.4 -2.2
Tier 1 capital 432.0 426.4 440.4 437.9 427.1
Fund at fair value 45.2 45.6 36.9 4.4 2.9
Upper Tier 2 loans 45.0 45.0 45.0 45.0 45.0
Lower Tier 2 loans 216.0 213.2 220.2 218.6 206.6
Tier 2 capital 306.2 303.8 302.1 268.0 254.5
Total capital base 738.2 730.2 742.5 705.9 681.6

 

Credit and counterparty risks  
Total exposures 3/2013            
             
             
Risk-weight Balance assets   Off-balance sheet commitments Total
0 %   1,008.1   22.8   1,030.9
10 %   1,188.9   -   1,188.9
20 %   808.2   129.6   937.8
35 %   5,726.0   54.6   5,780.6
50 %   0.1   -   0.1
75 %   534.5   87.7   622.2
100 %   548.1   36.2   584.4
150 %   13.6   0.6   14.2
Total   9,827.4   331.5   10,159.0
Derivatives  *)   310.6   -   310.6
Total   10,138.0   331.5   10,469.5
*) derivative agreements credit conversion factor        
             
Risk-weighted exposures           (EUR million)
Risk-weight   3/2013 12/2012 9/2012 6/2012 3/2012
0 %   - - - - -
10 %   118.9 125.5 133.6 120.8 125.6
20 %   167.2 120.3 145.6 155.5 163.9
35 %   2,011.7 2,025.2 2,023.4 2,008.1 1,990.4
50 %   0.0 0.1 0.3 0.3 0.3
75 %   418.1 428.9 437.9 439.9 437.2
100 %   565.8 502.5 567.8 590.0 614.5
150 %   20.9 25.9 20.3 28.5 35.3
Total   3,302.5 3,228.3 3,328.8 3,343.2 3,367.3
Derivatives  *)   19.0 20.6 26.8 26.5 27.7
Total   3,321.4 3,248.9 3,355.6 3,369.6 3,395.0
*) derivative agreements credit conversion factor        
In capital adequacy measurement to determine the exposure’s risk weight, Aktia applies credit rating by Moody’s Investors Service or Standard & Poor’s to receivables from central goverments and central banks, credit institutions, investment firms, corporates and covered bonds. The risk weight for bank exposures and bonds secured by real estate is determined by the credit rating of the country where the institution is located.
 

 

Risk-weighted amounts for operational risks            
  2012 2011 2010   3/2013 12/2012 9/2012 6/2012 3/2012
Gross income 183.3 187.8 208.5            
- average 3 years 193.2                
Capital requirement for operational risk         29.0 29.0 29.8 29.8 29.8
Risk-weighted amount         362.3 362.3 372.3 372.3 372.3
                   
The capital requirement for operational risk is 15% of average gross income during the last three years.
The risk-weighted amount is calculated by dividing the capital requirement by 8%.
 

 
 

 

Derivatives and off-balance sheet commitments  
       
Derivative instruments at 31 March 2013 (EUR million)   Assets, fair value Liabilities, fair value
  Total nominal amount
Hedging derivative instruments
       
Fair value hedging      
     Interet rate-related 2,760.0 133.2 25.4
Total 2,760.0 133.2 25.4
       
Cash flow hedging      
     Interest rate-related 75.0 0.2 -
Total 75.0 0.2 -
       
Derivative instruments valued via the income statement      
     Interest rate-related *) 4,003.8 134.3 133.4
     Currency-related 43.9 0.9 0.5
     Equity-related **) 77.5 2.3 2.3
     Other derivative instruments **) 20.8 0.0 0.0
Total 4,146.0 137.4 136.2
       
Total derivative instruments      
     Interest rate-related 6,838.8 267.6 158.8
     Currency-related 43.9 0.9 0.5
     Equity-related 77.5 2.3 2.3
     Other derivative instruments 20.8 0.0 0.0
Total 6,981.0 270.8 161.6
       
Derivative instruments at 31 December 2012 (EUR million)      
  Total nominal amount Assets, fair value Liabilities, fair value
Hedging derivative instruments
       
Fair value hedging      
     Interest rate-related 2,837.0 149.8 34.3
Total 2,837.0 149.8 34.3
       
Cash flow hedging      
     Interest rate-related 75.0 0.1 -
Total 75.0 0.1 -
       
Derivative instruments valued via the income statement      
     Interest rate-related *) 4,280.1 150.0 149.1
     Currency-related 55.6 0.6 1.3
     Equity-related **) 102.2 1.7 1.7
     Other derivative instruments **) 20.8 0.1 0.1
Total 4,458.6 152.4 152.1
       
Total derivative instruments      
     Interest rate-related 7,192.1 299.8 183.4
     Currency-related 55.6 0.6 1.3
     Equity-related 102.2 1.7 1.7
     Other derivative instruments 20.8 0.1 0.1
Total 7,370.6 302.2 186.4
       
*) Interest-linked derivatives include interest rate hedging provided for local banks which after back-to-back hedging with third parties amounted to EUR 3,934.0 (4,210.0) million.  
**) All equity-related and other derivative instruments relate to the hedging of structured debt products.  

 

Off-balance sheet commitments      
(EUR million) 31.3.2013 31.12.2012 31.3.2012
Commitments provided to a third party on behalf of the customers      
     Guarantees 34.0 34.6 41.2
     Other commitments provided to a third party 2.5 3.4 6.2
Irrevocable commitments provided on behalf of customers      
     Unused credit arrangements 295.0 307.6 410.6
Off-balance sheet commitments 331.5 345.5 458.0

 

Outlook

Aktia Bank is striving to grow slightly more than the market in the sectors focusing on private customers and small companies.

Aktia’ Banks plan of action includes several individual measures and will be realised in steps with the aim of reaching the financial objectives for 2015.

Aktia Bank’s aim is to improve competitiveness and to become the Finnish champion of customer services in selected customer segments. Aktia Bank will continue to strive for efficient and customer-friendly service, and to provide financial solutions for households, business owners, small companies and institutions.

Write-downs on credits are expected to be at the same level as in 2012.

In accordance with the decision taken by the Annual General Meeting of Aktia plc on 9 April 2013, a merger of Aktia plc and Aktia Bank plc is planned on 1 July 2013. Thus Aktia Bank plc becomes the new listed parent company of Aktia Group. As new parent company of the Group Aktia Bank plc will have the same outlook as the present parent company Aktia plc. That is “despite the probably persistent low interest rate level and one-off  costs from implementing the 2015 plan of action, the Group’s operating profit from continuing operations for 2013 is expected to reach approximately the 2012 level”.

In 2012, Aktia Group’s operating profit from continuing operations amounted to EUR 56.0 million.

Risks

Aktia’s financial results are affected by many factors, of which the most important are the general economic situation, fluctuations in share prices, interest rates and exchange rates, and the competitive situation. The demand for banking, insurance, asset management and real estate agency services can be changed by these factors.

Changes in interest rates, yield curves and credit margins are hard to predict and can affect Aktia’s interest margins and thus profitability. Aktia is pursuing proactive management of interest rate risks.

Any future write-downs of loans in Aktia’s loan portfolio could be due to many factors, of which the most important are the general economic situation, interest rates, the level of unemployment and changes in house prices.

The availability of liquidity on the money markets is important for Aktia’s refinancing activities. Like other banks, Aktia relies on deposits from households to service some of its liquidity needs.

The market value of Aktia’s financial and other assets can change, among other things as a result of requirements among investors for higher returns.

The financial crisis has resulted in many new initiatives for regulating banking and insurance businesses, which have brought uncertainty concerning future equity and liquidity requirements. The results of the new regulations are likely to be higher capital requirements, sharpened competition for deposits, higher demands on long-term financing, higher fixed costs and, eventually, higher credit margins.

The figures presented in this stock exchange release are unrevised.

Helsinki 7 May 2013

AKTIA BANK PLC

Board of Directors

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