Aktia Bank plc: Aktia Bank plc’s financial position and profit for the period January - 30 September 2012

 

Aktia Bank plc’s financial position and profit for the period January - 30 September 2012

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 - 30 September 2012. The information published is not an Interim Report as stipulated in the Securities Markets Act.

In 2013, a merger of the holding company Aktia plc with Aktia Bank plc is planned, as well as listing of the new parent company Aktia Bank plc on the stock exchange.

All information concerns Aktia Bank Group unless specified otherwise. 

Key figures                  
(EUR million) 7-9/2012 7-9/2011 ∆ % 1-9/2012 1-9/2011 ∆ % 4-6/2012 1-3/2012 2011
Earnings per share (EPS) 2.3 1.8 24% 8.4 7.5 13% 3.2 2.9 8.2
Equity per share (NAV)   1) 139.9 106.7 31% 139.9 106.7 31% 127.5 130.9 106.4
Return on equity (ROE), % 6.1 5.7 6% 8.0 8.2 -2% 8.8 8.8 6.8
Total earnings per share 12.4 3.7 239% 30.2 2.6 - 3.3 14.5 2.0
                   
Number of shares at the end of the period   1) 3 3 0% 3 3 0% 3 3 3
Personnel (FTEs), average number of employees from the beginning of the financial year   1) 753 774  
-3%
 
753
774 -3% 764 771 774
Banking Business (incl. Private Banking)                  
Cost-to-income ratio 0.69 0.79 -13% 0.69 0.72 -4% 0.69 0.68 0.73
                   
Borrowing from the public   1) 3,666.1 3,600.3 2% 3,666.1 3,600.3 2% 3,732.5 3,700.8 3,662.2
Lending to the public   1) 7,301.0 6,990.5 4% 7,301.0 6,990.5 4% 7,269.5 7,239.5 7,117.1
                   
Capital adequacy ratio, %   1) 19.9 16.6 20% 19.9 16.6 20% 18.9 18.1 16.2
Tier 1 capital ratio, %   1) 11.8 10.8 9% 11.8 10.8 9% 11.7 11.3 10.6
Risk-weighted commitments   1) 3,727.9 3,643.1 2% 3,727.9 3,643.1 2% 3,742.0 3,767.3 3,694.0
                   
Asset Management                  
Mutual fund volume   1) 4,246.7 3,379.2 26% 4,246.7 3,379.2 26% 4,107.4 4,140.0 3,613.4
Managed and brokered assets   1) 7,413.3 6,204.6 19% 7,413.3 6,204.6 19% 7,233.9 7,174.6 6,624.1
                   
 1)) At the end of the period                  

Formulas for key figures are presented in Aktia Bank plc’s Annual Report 2011 on page 6.

 

Consolidated income statement for Bank Group    
(EUR million) 1-9/2012 1-9/2011 ∆ % 2011
Net interest income 87.4 98.0 -11% 128.2
Dividends 0.1 0.1 -40% 0.2
     Commission income 57.3 54.0 6% 71.4
     Commission expenses -12.5 -13.4 7% -17.5
Net commission income 44.9 40.6 10% 54.0
Net income from financial transactions -0.2 -8.7 98% -9.3
Net income from investment properties -0.1 0.0 -106% -0.1
Other operating income 3.6 3.3 10% 4.6
Total operating income 135.7 133.3 2% 177.6
         
Staff costs -38.6 -38.6 0% -52.9
IT-expenses -15.1 -14.8 3% -19.9
Depreciation of tangible and intangible assets -2.4 -3.0 -22% -4.0
Other operating expenses -37.5 -38.9 -4% -53.0
Total operating expenses -93.6 -95.3 -2% -129.7
         
Write-down on other financial assets -1.8 - - -
Write-down on credits and other commitments -4.6 -6.3 -27% -10.5
Share of profit from associated companies -0.5 0.0 - 0.0
Operating profit 35.2 31.6 11% 37.4
Income and expenses from other activities - - - -3.9
Taxes -9.2 -8.3 11% -7.8
Profit for the period 26.0 23.3 11% 25.7
         
Attributable to:        
Shareholders in Aktia Bank plc 25.3 22.4 13% 24.7
Non-controlling interest 0.6 0.9 -29% 1.0
Total 26.0 23.3 11% 25.7
         
Earnings per share (EPS), EUR 8,442,627.57 7,470,051.90 13% 8,239,314.30
There is no dilution effect to earnings per share        

 

 

 
Consolidated statement of comprehensive income for Bank Group
       
(EUR million) 1-9/2012 1-9/2011 ∆ %      2011
         
Profit for the period 26.0 23.3 11% 25.7
Other comprehensive income after taxes:        
Change in valuation of fair value for financial assets available for sale 72.3 -14.8 - -19.2
Change in valuation of fair value for cash flow hedging -6.5 0.1 - -0.2
Transferred to the income statement for financial assets available for sale - - - 0.4
Comprehensive income from items which can be transferred to the income statement 65.9 -14.7 - -19.0
Defined benefit plan pensions - - - -0.3
Comprehensive income from items which can not be transferred to the income statement - - - -0.3
Total comprehensive income for the period 91.8 8.6 967% 6.4
         
Total comprehensive income attributable to:        
Shareholders in Aktia Bank plc 90.6 7.7 - 6.0
Non-controlling interest 1.2 0.9 32% 0.4
Total 91.8 8.6 967% 6.4
         
Total earnings per share, EUR 30,203,043.59 2,560,447.72 - 2,002,733.92

 

 

Consolidated balance sheet for Bank Group  
(EUR million) 30.9.2012 31.12.2011 ∆ % 30.9.2011
Assets        
Cash and balances with central banks 236.1 466.3 -49% 298.3
Interest-bearing securities 2,025.2 1,874.4 8% 1,904.7
Shares and participations 8.0 1.8 344% 2.0
Financial assets available for sale 2,033.2 1,876.2 8% 1,906.6
Financial assets held until maturity 10.1 20.0 -50% 20.0
Derivative instruments 395.7 300.7 32% 264.2
Lending to Bank of Finland and credit institutions 167.8 88.8 89% 59.8
Lending to the public and public sector entities 7,301.0 7,117.1 3% 6,990.5
Loans and other receivables 7,468.8 7,205.8 4% 7,050.3
Investments in associated companies 0.8 3.5 -76% 3.5
Intangible assets 2.3 2.3 2% 2.3
Investment properties 0.7 0.7 0% 0.0
Other tangible assets 4.5 5.3 -15% 5.8
Accured income and advance payments 71.6 70.6 1% 68.8
Other assets 6.9 7.6 -9% 8.2
Total other assets 78.5 78.2 0% 77.0
Income tax receivables 3.8 22.3 -83% 16.5
Deferred tax receivables 0.3 11.9 -97% 11.1
Tax receivables 4.1 34.2 -88% 27.6
Total assets 10,234.8 9,993.1 2% 9,655.7
         
Liabilities        
Liabilities to credit institutions 1,097.3 1,112.1 -1% 945.2
Liabilities to the public and public sector entities 3,666.1 3,662.2 0% 3,600.3
Deposits 4,763.4 4,774.3 0% 4,545.5
Derivative instruments 196.6 160.6 22% 153.1
Debt securities issued 3,743.7 3,811.5 -2% 3,707.4
Subordinated liabilities 295.4 288.7 2% 288.5
Other liabilities to credit institutions 395.1 353.5 12% 395.7
Other liabilities to the public and public sector entities 162.8 51.7 215% 31.6
Other financial liabilitites 4,596.9 4,505.4 2% 4,423.2
Accured expenses and income received in advance 96.4 102.6 -6% 95.7
Other liabilities 53.9 44.4 21% 28.5
Total other liabilities 150.3 147.0 2% 124.2
Income tax liabilities 0.9 0.0 - 0.6
Deferred tax liabilities 42.2 28.9 46% 30.6
Tax liabilities 43.0 29.0 49% 31.2
Total liabilities 9,750.3 9,616.3 1% 9,277.2
         

Equity
       
Restricted equity 218.9 153.6 42% 157.4
Unrestricted equity 200.8 165.5 21% 162.9
   Shareholders’  share of equity 419.7 319.1 32% 320.2
   Non-controlling interest’s share of equity 64.8 57.7 12% 58.2
Equity 484.5 376.8 29% 378.5
Total liabilities and equity 10,234.8 9,993.1 2% 9,655.7

 

 

Consolidated statement of changes in equity          
                   
                   
                   
        Fund for     Shareholders' Non-controlling  
    Other restricted Fund at share-based Unrestricted Retained share of interest's share Total
(EUR million) Share capital equity fair value payments equity reserve earnings equity of equity equity
Equity as at 1January 2011 93,9 10,3 22,5 0,8 72,7 253,0 453,0 44,3 497,3
Divestment of own shares           0,2 0,2   0,2
Dividens to shareholders           -19,9 -19,9   -19,9
   Profit for the period           27,7 27,7 0,9 28,6
   Financial assets available for sale     -1,2       -1,2 0,1 -1,1
   Cash flow hedging     0,2       0,2 0,0 0,1
Total comprehensive income for the period   -1,0     27,7 26,7 0,9 27,6
Other change in equity       -0,7     -0,7 13,0 12,4
Equity as at 30 September 2011 93,9 10,3 21,5 0,1 72,7 260,8 459,2 58,2 517,5
                   
                   
Equity as at 1January 2012 93,9 10,3 19,1 0,2 72,7 269,9 466,0 57,7 523,8
Divestment of own shares           0,0 0,0   0,0
Dividens to shareholders           -20,0 -20,0   -20,0
   Profit for the period           43,1 43,1 0,6 43,7
   Financial assets available for sale     95,9       95,9 0,2 96,1
   Cash flow hedging     -6,9       -6,9 0,4 -6,5
Total comprehensive income for the period   89,0     43,1 132,1 1,2 133,3
Other change in equity       0,7     0,7 5,9 6,6
Equity as at 30 September 2012 93,9 10,3 108,1 0,9 72,7 293,1 578,9 64,8 643,7

 

Consolidated cash flow statement for Bank Group  
(EUR million) 1-9/2012 1-9/2011 ∆  %    2011
Cash flow from operating activities        
Operating profit 35.2 31.6 11% 37.4
Adjustment items not included in cash flow for the period 4.0 16.4 -75% 20.1
Unwinded cash flow hedging 9.1 - - 17.6
Paid income taxes 13.6 -29.0 - -36.0
Cash flow from operating activities before change in operating receivables and liabilities        
62.0 19.1 225% 39.0
Increase (-) or decrease (+) in receivables from operating activities -312.4 368.5 - 198.1
Increase (+) or decrease  (-) in liabilities from operating activities 4.6 -340.3 - -36.3
Total cash flow from operating activities -245.9 47.3 - 200.9
Cash flow from investing activities        
Financial assets held until maturity 9.9 1.4 595% 1.4
Proceeds from sale of group companies and associated companies 0.0 0.3 - 0.3
Investment in tangible and intangible assets -1.9 -2.4 23% -2.8
Disposal of tangible and intangible assets 0.0 0.2 -79% 0.2
Total cash flow from investing activities 8.1 -0.5 - -1.0
Cash flow from financing activities        
Subordinated liabilities 5.4 3.3 60% 3.6
Increase in unrestricted equity reserve 30.0 - - -
Share issue / dividend of Aktia Real Estate Mortgage Bank plc to the non-controlling interest 5.9 13.5 -57% 13.5
Paid dividends -20.0 -20.0 0% -20.0
Total cash flow from financing activities 21.2 -3.1 - -2.9
Change in cash and cash equivalents -216.6 43.6 - 197.0
Cash and cash equivalents at the beginning of the year 473.0 275.9 71% 275.9
Cash and cash equivalents at the end of the period 256.3 319.5 -20% 473.0
Cash and cash equivalents in the cash flow statement consist of the following items:        
Cash in hand 8.2 8.3 -1% 9.5
Bank of Finland current account 228.0 290.0 -21% 456.8
Repayable on demand claims on credit institutions 20.2 21.3 -5% 6.6
Total 256.3 319.5 -20% 473.0
Adjustment items not included in cash flow consist of:        
Write-downs on other financial assets 1.8 - - -
Write-downs on credits and other commitments 4.6 6.3 -27% 10.5
Change in fair values 2.4 6.5 -63% 7.2
Depreciation and impairment of intangible and tangible assets 2.4 3.0 -22% 4.0
Share of profit from associated companies 0.9 0.3 196% 0.3
Sales gains and losses from intangible and tangible assets 0.2 0.6 -74% 0.6
Unwinded cash flow hedging -8.2 - - -2.5
Other adjustments - -0.4 - 0.0
Total 4.0 16.4 -75% 20.1
         

 

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, Aktia Kort Ab 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.

Operating profit (EUR million) 7-9/2012 7-9/2011 ∆  %   
Banking Business      9.9 6.2 59%
Asset Management      2.9 1.4 117%
Miscellaneous               -2.7 -0.4 -588%
Eliminations       -0.3 0.0 -
Total 9.8 7.2 36%

 

Operating profit (EUR million) 1-9/2012 1-9/2011 ∆  %   
Banking Business      33.5 31.4 7%
Asset Management      7.2 4.4 63%
Miscellaneous               -4.5 -1.3 -241%
Eliminations       -1.1 -2.9 63%
Total 35.2 31.6 11%

Net interest income

 

(EUR million) 1-9/2012 1-9/2011 ∆ % 2011
Deposits and lending 43.6 47.1 -7% 63.0
Hedging, interest rate risk management 21.8 27.9 -22% 34.8
Other 21.9 23.0 -5% 30.3
Net interets income 87.4 98.0 -11% 128.2
         

 

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) 30.9.2012 31.12.2011 ∆  Share, %
Households 6,224.6 5,965.6 259.0 85.3,%
Corporate 754.3 811.6 -57.3 10.3,%
Housing associations 278.3 288.7 -10.4 3.8,%
Non-profit organisations 39.0 45.2 -6.2 0.5,%
Public sector entities 4.8 6.0 -1.2 0.1,%
Total 7 ,301.0 7,117.1 184.0 100.0%

 

Chart 2. Gross loans and write-downs
(EUR million)
30.9.2012 30.6.2012 31.3.2012 31.12.2011
Gross loans 7,364.7 7,334.0 7,303.2 7,180.3
Individual write-downs -47.8 -50.2 -49.5 -49.2
       Of which made to non-performing loans past due at least 90 days -39.4 -42.0 -42.7 -39.2
       Of which made to other loans -8.4 -8.2 -6.9 -10.0
Write-downs by group -15.9 -14.2 -14.1 -14.0
Net loans, balance amount 7 ,301.0 7,269.5 7,239.5 7,117.1
         

 

Total write-downs on credits amounted to 0.06 (0.09)% of total lending for the period. The corresponding impact on corporate loans amounted to

0.5 (0.7)% of the total corporate lending.

Chart 3. Undischarged debts by time overdue

 

(EUR million)
Days
30.9.2012 % of stock 30.9.2011 % of stock 2011
1-30 138 1.88 209 2.97 160
of which households 118 1.61 144 2.05 115
           
31-89 54 0.74 61 0.87 53
of which households 36 0.49 47 0.66 46
           
90- * 53 0.72 56 0.80 60
of which households 38 0.52 39 0.56 36

 

Specification of the fund at fair value

(EUR million)   30.9.2012 31.12.2011
Shares and participations 5.0 - 5.0
Direct interest-bearing securities 31.9 -34.9 66.7
Cash flow hedging 19.0 25.5 -6.5
Fund at fair value, total 55.9 -9.4 65.3

 

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
  9/12 2011 9/12 2011 9/12 2011 9/12 2011 9/12 2011 9/12 2011 9/12 2011 9/12 2011
EU AAA 136 145 1,269 916 286 309 12 - - - 1,703 1,370
Finland 132 61 233 111 43 37 - - - -   407 210
Other AAA-countries 4 84 1,037 805 243 272 12 - - - 1,296 1,161
EU < AAA - 51 183 352 - 37 - 2 - - - 183 442
Belgium - - - - - - - -
Greece - - 2 - - - - - - 2
Ireland - 30 27 - - - - - 30 27
Italy - 46 60 - - - - - 46 60
Portugal - 22 54 76 - 8 - 1 - - - 54 107
Spain - 29 52 187 - 29 - 1 - - - 52 246
Other countries - - - - - - - -
Europe excluding EU - 232 50 12 30 - - - - 244 80
North America - 23 33 - - - - - 23 33
Other OECD-countries - - - - - - - -
Supernationals - - 45 43 - - - - 45 43
Others - - - - - - - -
Total 136 197 1,706 1,350 343 419 12 2 - - - 2,197 1,968

 

Rating distribution for banking business’ liquidity portfolio

  30.9.2012 31.12.2011
(EUR million) 2,197 1,968
Aaa 55.9% 55.6%
Aa1-Aa3 26.3% 21.9%
A1-A3 9.0% 11.9%
Baa1-Baa3 4.5% 6.3%
Ba1-Ba3 0.4% 1.9%
B1-B3 0.0% 0.0%
Caa1 or lower 0.0% 0.0%
Finnish municipalities (unrated) 3.9% 2.1%
No rating 0.0% 0.3%
Total 100.0% 100.0%
 

Capital adequacy

Capital adequacy 30.9.2012 31.12.2011 30.9.2011
Bank Group      
Capital adequacy 19.9% 16.2% 16.6%
Tier 1 ratio 11.8% 10.6% 10.8%
Aktia Bank      
Capital adequacy 27.6% 22.3% 22.1%
Tier 1 ratio 16.2% 14.6% 14.3%
Aktia Real Estate Mortgage Bank      
Capital adequacy 10.9% 10.2% 10.7%
Tier 1 ratio 9.4% 8.5% 9.0%

 

Risk exposures for Bank Group
           
Consolidated capital adequacy for Bank Group          
Summary (EUR million) 9/2012 6/2012 3/2012 12/2011 9/2011
Tier 1 capital 440.4 437.9 427.1 392.6 393.4
Tier 2 capital 302.1 268.0 254.5 206.4 210.3
Capital base 742.5 705.9 681.6 599.1 603.7
Risk-weighted amount for credit and counterpart risks 3,355.6 3,369.6 3,395.0 3,321.6 3,294.4
Risk-weighted amount for market risks  1) - - - - -
Risk-weighted amount for operational risks 372.3 372.3 372.3 372.3 348.6
Risk-weighted commitments 3,727.9 3,742.0 3,767.3 3,694.0 3,643.1
Capital adequacy ratio, % 19.9 18.9 18.1 16.2 16.6
Tier 1 Capital ratio, % 11.8 11.7 11.3 10.6 10.8
Minimum capital requirement 298.2 299.4 301.4 295.5 291.4
Capital buffer (difference between capital base and minimum requirement) 444.3 406.5 380.2 303.5 312.3
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) 9/2012 6/2012 3/2012 12/2011 9/2011
Share capital 163.0 163.0 163.0 163.0 163.0
Funds 74.6 74.6 74.5 44.6 44.6
Non-controlling interest 64.8 64.0 58.3 57.7 58.2
Retained earnings 100.9 100.9 100.0 96.2 95.9
Profit for the period 25.3 18.4 8.8 24.7 22.4
 ./. provision for dividends to shareholders -15.9 -10.6 -5.3 -21.3 -15.8
Capital loan 30.0 30.0 30.0 30.0 30.0
Total 442.8 440.3 429.3 394.9 398.3
 ./. intangible assets -2.3 -2.4 -2.2 -2.3 -4.9
Tier 1 capital 440.4 437.9 427.1 392.6 393.4
Fund at fair value 36.9 4.4 2.9 -34.9 -31.5
Upper Tier 2 loans 45.0 45.0 45.0 45.0 45.0
Lower Tier 2 loans 220.2 218.6 206.6 196.3 196.7
Tier 2 capital 302.1 268.0 254.5 206.4 210.3
Total capital base 742.5 705.9 681.6 599.1 603.7

 

Risk-weighted commitments, credit and counterparty risks  
Total exposures 9/2012            
             
             
Risk-weight Balance assets   Off-balance sheet commitments Total
0 %   944.4     19.1 963.5
10 %   1,335.8     - 1,335.8
20 %   688.7     185.0 873.7
35 %   5,756.6     64.6 5,821.2
50 %   0.5     - 0.5
75 %   555.9     97.2 653.2
100 %   538.6     61.0 599.5
150 %   13.2     0.8 14.0
Total   9,833.6     427.7 10,261.4
Derivatives  *)   456.9     - 456.9
Total   10,290.5     427.7 10,718.3
*) derivative agreements credit conversion factor        
             
Risk-weighted exposures           (EUR million)
Risk-weight   9/2012 6/2012 3/2012 12/2011 9/2011
0 %   - - - - -
10 %   133.6 120.8 125.6 105.1 103.8
20 %   145.6 155.5 163.9 146.6 158.9
35 %   2 023.4 2,008.1 1,990.4 1,943.7 1,898.3
50 %   0.3 0.3 0.3 0.3 0.4
75 %   437.9 439.9 437.2 450.9 458.0
100 %   567.8 590.0 614.5 601.8 616.6
150 %   20.3 28.5 35.3 40.1 30.1
Total   3 328.8 3,343.2 3,367.3 3,288.4 3,266.0
Derivatives  *)   26.8 26.5 27.7 33.2 28.4
Total   3 355.6 3,369.6 3,395.0 3,321.6 3,294.4
*) 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            
  2011 2010 2009   9/2012 6/2012 3/2012 12/2011 9/2011
Gross income 187.8 208.5 199.4            
- average 3 years 198.6                
Capital requirement for operational risk         29.8 29.8 29.8 29.8 27.9
Risk-weighted amount         372.3 372.3 372.3 372.3 348.6
                   
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 30 September 2012 (EUR million)   Assets, fair value Liabilities, fair value
  Total nominal amount
Hedging derivative instruments
       
Fair value hedging      
     Interet rate-related 3,757.0 234.4 37.6
Total 3,757.0 234.4 37.6
       
Cash flow hedging      
     Interest rate-related 430.0 9.9 0.0
Total 430.0 9.9 0.0
       
Derivative instruments valued via the income statement      
     Interest rate-related *) 4,838.2 149.1 156.7
     Currency-related 77.5 0.1 0.1
     Equity-related **) 104.1 2.0 2.0
     Other derivative instruments **) 21.0 0.1 0.1
Total 5,040.8 151.3 158.9
       
Total derivative instruments      
     Interest rate-related 9,025.2 393.5 194.4
     Currency-related 77.5 0.1 0.1
     Equity-related 104.1 2.0 2.0
     Other derivative instruments 21.0 0.1 0.1
Total 9,227.8 395.7 196.6
       
Derivative instruments at 30 September 2011 (EUR million)      
  Total nominal amount Assets, fair value Liabilities, fair value
Hedging derivative instruments
       
Fair value hedging      
     Interest rate-related 3,940.5 127.0 32.5
Total 3,940.5 127.0 32.5
       
Cash flow hedging      
     Interest rate-related 655.0 21.0 0.0
Total 655.0 21.0 0.0
       
Derivative instruments valued via the income statement      
     Interest rate-related *) 7,339.2 112.2 116.7
     Currency-related 90.7 0.6 0.5
     Equity-related **) 119.3 2.6 2.6
     Other derivative instruments **) 4.2 0.8 0.8
Total 7,553.4 116.2 120.6
       
Total derivative instruments      
     Interest rate-related 11,934.7 260.2 149.2
     Currency-related 90.7 0.6 0.5
     Equity-related 119.3 2.6 2.6
     Other derivative instruments 4.2 0.8 0.8
Total 12,148.9 264.2 153.1
       
*) Interest-linked derivatives include interest rate hedging provided for local banks which after back-to-back hedging with third parties amounted to EUR 4,478.0 (6,947.0) million.  
**) All equity-related and other derivative instruments relate to the hedging of structured debt products.  

 

Off-lanace sheet commitments      
(EUR million) 30.9.2012 31.12.2011 30.9.2011
Commitments provided to a third party on behalf of the customers      
     Guarantees 40.0 42.2 45.7
     Other commitments provided to a third party 2.7 3.3 3.7
Irrevocable commitments provided on behalf of customers      
     Unused credit arrangements 385.0 419.8 586.4
Off-balance sheet commitments 427.7 465.4 635.8

 

Outlook (changed 15 October 2012)

Aktia is endeavouring to grow above the market in the sectors focusing on retail customers and small companies.

In 2012, Aktia’s focus is on increasing growth by strengthening customer relations, increasing sales per customer and cross-selling, and developing Internet services. This and the successful operation of the segment Asset Management has increased commission income for the period, contri-buting to the improved outlook for the full-year 2012.

Profitability has also been improved through cost savings as well as through effective risk management and capital optimisation.

The interest rate derivatives that lifted the net interest income (NII) to an exceptional level have matured. The high NII level from 2009–2011 is therefore not possible to maintain in a low interest rate environment.

Write-downs on credits are expected to decrease in 2012 as a whole.

Operating profit for 2012 will exceed the level in 2011.  (Previously: The operating profit for 2012 is expected to be on the same level as in 2011).

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. Changes in these factors can have an impact on demand for banking, insurance, asset management and real estate agency services.

Change in the interest rate level, yield curves and credit margins are hard to predict and can affect Aktia’s interest rate margins and therefore pro-fitability. Aktia is pursuing effective management of interest rate risks.

Any future write-downs of loans in Aktia’s loan portfolio could be due to many factors, the most important of which are the general economic situation, the interest rate level, 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 in order to service some of its liquidity needs.

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

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

In preparing this report the Bank Group has followed the accounting principles applicable to the Annual Report of 31 December 2011. There were no new or revised IFRSs or Interpretations from IFRIC (International Financial Reporting Interpretations Committee) that had any effect on the Group’s financial position or explanatory notes in for the period 1 January - 30 September 2012.

The figures presented in this stock exchange release are unrevised.

Helsinki 8 November 2012

AKTIA BANK PLC

Board of Directors

         CEO Jussi Laitinen, tel. +358 10 247 6250
         Deputy CEO, CFO Stefan Björkman, tel. +358 50 63219
         IR manager Anna Gabrán, tel. +358 10 247 6501, +358 40 7081807

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