Year-end report for FöreningsSparbanken for 2001

Preliminary year-end report for FöreningsSparbanken 2001 in summary: · Operating profit amounted to SEK 8,039 M (9,366) · Operating profit, excluding nonrecurring items, amounted to SEK 8,202 M (8,178) · The return on equity amounted to 14.7 percent (19.7) · Earnings per share amounted to SEK 9.86 (12.10) · Net interest income rose by 11 percent to SEK 15,016 M (13,589 ) · Net commission income decreased by 10 percent to SEK 6,072 M (6,784 ) · Loan losses amounted to SEK 1,337 M (1,115 ) and the loan loss level was unchanged at 0.2 percent (0.2) · Robur's share of net mutual fund contributions rose to 20 percent (17) · Unchanged dividend of SEK 5.50 per share (5.50) proposed During the fourth quarter: · New online savings account launched · Synthetic securitization of agricultural loans for slightly over SEK 14 billion · Ownership in FIH raised to 67.2 percent (and further raised to 69.7 percent in February 2002) Group profit The Group's operating profit for 2001 amounted to SEK 8,039 M (9,366). Profit was affected by costs of SEK 163 M associated with the cancelled merger with SEB. Thus, operating profit excluding these nonrecuring items amounted to SEK 8,202. The corresponding result in 2000 amounted to SEK 8,178 M excluding nonrecurring capital gains of approximately SEK 700 M, a VAT recovery including interest of SEK 202 M and a surplus insurance refund from Alecta (formerly SPP), which reduced expenses by SEK 286 M. For the year as a whole, profit was affected positively by FIH and Hansapank's development and the reduced cost of the state deposit guarantee, whereas equity-related income declined. Profit of associated companies was negatively affected by SpareBank 1 Gruppen in Norway and Marakanda. The return on equity during the year was 14.7 percent (19.7). Earnings per share amounted to SEK 9.86 (12.10). Excluding nonrecurring items, the return was 14.9 percent (17.1) and earnings per share were SEK 10.06 (10.32). For the fourth quarter of 2001, operating profit was SEK 1,677 M (1,362). The change is mainly due to the fact that the allocation to the Kopparmyntet profit-sharing fund was approximately SEK 600 M lower in the fourth quarter of 2001 than 2000 and that loan losses were slightly over SEK 200 M higher in the last quarter of 2001, partly due to country risk-related provisions of SEK 63 M for Argentina. For the full-year, the loan loss level was unchanged at 0.2 percent (0.2). Compared with the third quarter of 2001, operating profit decreased by SEK 325 M. Income was largely unchanged in the fourth quarter compared with the third quarter of 2001, while expenses rose by approximately SEK 100 M and loan losses were slightly over SEK 200 M higher. Income The Group's total income amounted to SEK 23,409 M (24,003). Income for the fourth quarter amounted to SEK 5,768 M, compared with SEK 5,755 M in the third quarter of 2001 and SEK 5,857 M in the fourth quarter of 2000. Net interest income The Group's net interest income rose during the year by SEK 1,427 M or 11 percent to SEK 15,016 M (13,589). The improvement is primarily due to an increase in FIH and Hansapank's net interest income totaling approximately SEK 850 M. Spintab's net interest income rose by SEK 288 M, of which approximately SEK 100 M relates to lower loan insurance fees. In addition, the state deposit guarantee fee, which is charged to net interest income, declined by SEK 462 M. During the fourth quarter net interest income amounted to SEK 3,815 M, compared with SEK 3,681 M in the previous quarter and SEK 3,460 M in the fourth quarter of 2000. The fourth-quarter increase is mainly due to an improvement in net interest income in FIH and Hansapank. Net commission income Net commission income for the full-year 2001 decreased by SEK 712 M or slightly over 10 percent to SEK 6,072 M (6,784). Due to lower market volume and declining stock prices, brokerage commissions fell by SEK 422 M and asset management commissions by SEK 516 M. Net commission income from payment services developed strongly during the year, rising by SEK 254 M compared with 2000. Net commission income during the fourth quarter amounted to SEK 1,486 M, compared with SEK 1,518 M in the third quarter and SEK 1,773 M in the fourth quarter of 2000. Although stock prices rose during the fourth quarter, average prices were lower during the period, due to which asset management commissions remained at a lower level. Net profit on financial operations Net profit on financial operations amounted to SEK 1,110 M (1,694). Profit on stock trading declined by SEK 437 M, while income from foreign exchange operations developed positively, mainly at Swedbank Markets, though also in Hansapank. Net profit on financial operations during the fourth quarter amounted to SEK 148 M (395). In the third quarter of 2001 the corresponding profit was SEK 341 M. The lower fourth-quarter figure is mainly attributable to Swedbank Markets and FIH, where declining securities and derivatives prices adversely affected earnings. Other income Other income amounted to SEK 1,063 M (1 689). During the year income from IT-services to the independent savings banks and partly owned banks in the Swedish operations developed positively, rising by approximately SEK 80 M. Real estate income in Hansapank rose by SEK 35 M due to the LTB acquisition. The 2000 figure included capital gains of approximately SEK 700 M and a VAT recovery of SEK 168 M. Expenses Expenses for 2001 amounted to SEK 13,894 M (13,719). In the previous year the Group reported a surplus insurance refund from Alecta, which reduced expenses by SEK 286 M. Excluding the subsidiaries FIH and Hansapank, allocations to the Kopparmyntet profit-sharing fund, costs associated with the cancelled merger with SEB and the refund from Alecta, expenses decreased by SEK 471 M or 4 percent to SEK 11,435 M (11,906). The total expenses for the now liquidated Danish Internet bank, Firstviewbank, amounted to SEK 216 M during the year. Staff costs Staff costs for the year amounted to SEK 6,614 M (6,734), including charges of SEK 396 M (769) for profit-sharing allocations in the Group. The allocation to the Kopparmyntet profit-sharing fund amounted to SEK 282 M (721) during the year. The remaining provisions pertain to Hansapank's profit-sharing fund. Change in the number of employees Number of Group employees in terms of full-time positions. Dec 31 Dec 31 2001 2000 Total number of employees 16,068 13,002 Of which Hansapank* 6,387 3,180 Of which FIH 150 142 * The increase in Hansapank is due to the acquisition of LTB during the second quarter of 2001, which added slightly over 3,000 employees. IT expenses IT expenses include all other development and production expenditures as well as computer equipment service costs and depreciation. IT expenses for 2001, after deducting IT-related income from partly owned banks and independent savings banks, amounted to SEK 2,358 M. Defined the same way, the corresponding expense last year was SEK 2,377 M. IT expenses declined according to plan during the second half of 2001 compared with both the first half and the second half of 2000. Other expenses Other expenses amounted to SEK 5,873 M (6,000) during the year. Expenses directly attributable to the cancelled merger preparations with SEB, excluding staff and IT expenses, amounted to SEK 163 M. Loan losses Loan losses amounted to SEK 1,337 M (1,115), of which FIH and Hansapank accounted for SEK 146 M (272). During the fourth quarter a country risk- related provision of SEK 63 M was allocated for Argentina. The loan loss level has fluctuated by quarter, but for the year as a whole remained at an unchanged relative level of 0.2 percent (0.2). A specification of loan losses and problem loans is provided in Notes 4 and 5. Share of profit of associated companies The share of profit of associated companies includes profit from companies that are consolidated according to the equity method, i.e. companies in which FöreningsSparbanken holds between 20 and 50 percent of the voting rights of the shares. The share of profit of associated companies in 2001 was SEK -129 M (197). Of the decline, SEK 146 M was attributable to SpareBank1 Gruppen in Norway. Profit in their insurance operations was negatively affected by falling stock prices. Goodwill amortization attributable to Sparebank 1 Gruppen's acquisition of the Norwegian bank VÅR-Gruppen in the previous year also had a negative effect on earnings. The share of profit from Marakanda amounted to SEK -128 M (-42), while associated companies in FIH accounted for SEK -17 M (53). Marakanda's deficit was mainly due to the fact that implementation by its customers is taking longer than planned, which has resulted in a lower income level. In 2000 Marakanda's profit was included only for the fourth quarter. The higher profit share from FIH in 2000 is the result of capital gains in one of FIH's associated companies. Tax expense 26,7 percent Operating profit before tax amounted to SEK 7,952 (9,361) and the tax expense to SEK 2,123 (2,476), or an effective tax rate of 26,7 percent (26,4). Interest rate risk An increase in market interest rates of one percentage point as of December 31, 2001 would have reduced the value of the Group's interest- bearing assets and liabilities, including derivatives, by SEK 913 M (603). The decrease in value for positions in SEK would have amounted to SEK 533 M (437) and for positions in foreign currency SEK 380 M (166). The Group's interest rate risk in foreign currency is primarily in the foreign subsidiaries Hansapank and FIH. An interest rate increase of one percentage point would have reduced the Group's net profit on financial operations by SEK 402 M (92) as of December 31, 2001. The increase in the sensitivity of net profit on financial operations arose mainly due to the extended duration in the Group's liquidity portfolio in Denmark. To improve liquidity, FIH's securities portfolio has been reallocated, which has extended its duration. The Group also holds positions in inflation-indexed instruments denominated in SEK, which a one-percent increase in real interest rates would have reduced in value by SEK 36 M (40) as of December 31, 2001, of which SEK 13 M (9) would affect reported net profit on financial operations. Capital adequacy On December 31, 2001 the capital adequacy ratio, which is calculated for the financial companies group, amounted to 11.3 percent (10.8), of which the primary capital ratio was 7.1 percent (6.9). Market risks as a share of the total capital adequacy ratio amounted to 0.7 percentage points (0.5). Specification of capital adequacy SEK M Dec 31 Dec 31 2001 2000 Primary capital 38,938 35,045 Supplementary capital 26,813 24,091 Less shares, etc. - 5,300 - 5,020 Expanded portion of capital 1,292 883 base Capital base 61,743 54,999 Risk-weighted amount for 514,743 484,775 credit risks Risk-weighted amount for 33,054 24,192 market risks Total risk-weighted amount 547,797 508,967 Capital adequacy ratio, % 11.3 10.8 Primary capital ratio, % 7.1 6.9 The risk-weighted amount for credit risks rose to SEK 515 billion (485). The increase is primarily attributable to higher lending by Spintab, FIH and Hansapank. The risk-weighted amount for market risks rose by nearly SEK 9 billion during the year to approximately SEK 33 billion. The increase in the risk-weighted amount for interest rate risks was mainly due to the extended duration in FIH's liquidity portfolio. The decline in the value of the Swedish krona raised the market value of exchange rate-related derivatives, leading to an increase in the risk-weighted amount for counterparties. The risk-weighted amount for exchange-rate risks was affected by the fact that a large part of Hansapank's liquidity reserve was placed in interest-bearing securities denominated in euro, that euro lending financed in Estonian currency increased and that the Bank expanded its operations in the Baltic region through both acquisitions and organic growth. As of December 31, 2001 the FöreningsSparbanken financial companies group included the FöreningsSparbanken Group, Eskilstuna Rekarne Sparbank AB, Färs och Frosta Sparbank AB, FöreningsSparbanken Sjuhärad AB, FöreningsSparbanken Söderhamn AB, Bergslagens Sparbank AB, Vimmerby Sparbank AB, Aktia Sparbank Abp in Finland and Sparebank 1 Gruppen in Norway. The Group's insurance companies are not included. Business area development Savings Customers' total savings in FöreningsSparbanken amounted to SEK 526 billion (531) as of December 31, 2001. Deposits from the public rose by 9 percent during the year. Successful launch of online savings account In November FöreningsSparbanken launched a new savings account with a preferred interest rate. As of December 31, 2001 just over 43,000 accounts had been opened and total deposits amounted to SEK 1,130 M. Deposits rose 9 percent during the year Customers' deposits rose to slightly over SEK 229 billion (211), an increase of SEK 18 billion or slightly over 9 percent. Deposits in SEK were largely unchanged at slightly over SEK 180 billion (179), while deposits in foreign currency rose by SEK 17 billion or slightly over 53 percent to SEK 49 billion (32). Hansapank's newly acquired subsidiary LTB accounts for SEK 8 billion of the increased deposits in foreign currency. Savings and investments, the Group SEK billion Dec 31 Dec 31 2001 2000 Deposits from the public Households, SEK 118.4 110.5 Other, SEK 61.7 68.6 Households, foreign currency 14.0 7.5 Of which Hansapank 13.9 7.5 Other, foreign currency 35.3 24.7 Of which Hansapank 16.9 9.1 Subtotal 229.4 211.3 Discretionary management 21.1 21.5 Fund management 266.0 287.9 Retail bonds, interest-bearing 2.4 3.1 Retail bonds, stock index 4.6 5.6 Unit-linked insurance 43.3 45.4 Less unit-linked insurance in - 41.2 - 43.5 own cos. Total 525.6 531.3 Robur's share of net investments rose to approximately 20 percent Net contributions to Robur's mutual funds during the year totaled approximately SEK 11 billion, against SEK 17 billion in the corresponding period a year earlier. Approximately SEK 5 billion (9) was insurance savings in Robur Försäkring. Robur's share of net investments in the mutual fund market rose to 20 percent, compared with 17 percent in 2000. Fund management, Robur Dec 31 Dec 31 2001 2000 Assets under management (SEK 266 288 bn) Of which: Swedish equities, % 29.4 34.0 Foreign equities, % 43.6 45.3 Interest-bearing securities, % 27.0 20.7 Number of customers 2,719 2,637 (thousands) Robur's assets under management amounted to SEK 266 billion (288) on December 31, 2001. The decrease in assets despite higher net contributions is due to the decline in global stock prices. Robur's share of assets under management in the mutual fund market was 30 percent (32) as of December 31, 2001. The subsidiary FöreningsSparbanken Kapitalförvaltning managed assets of SEK 36 billion (35), of which SEK 15 billion (13) was invested in Robur funds. Unit-linked insurance, Robur Försäkring Dec 31 Dec 31 2001 2000 Assets under management (SEK bn) 41 45 Number of policies (thousands) 602 498 Sales (premiums paid) of fund-allocated unit-linked insurance amounted to SEK 9 billion (14) during the year. Net contributions during the same period amounted to SEK 5 billion (9). As of December 31, 2001 assets under management by Robur Försäkring amounted to SEK 41 billion (45). On a moving 12-month basis the market share for new unit-linked insurance of 20 percent as September 30, 2001. Robur Försäkring had approximately 602,000 (498,000) policies as of year-end, in addition to around 1 million group life insurance policies. Asset management results Substantial declines in stock prices around the world and the dramatic events in the U.S. strongly affected asset management results in 2001. A large number of mutual funds reported negative results. Of Robur's 48 mutual funds, 15 either outperformed or performed as well as their respective indexes. Management results during the year did not reach the objective, i.e. that all funds exceed their indexes. Results improved during the second half of the year, however. In the shadow of a difficult year for stocks, Robur's fixed income funds developed positively. In absolute terms, they all rose by between three and four percent, but marginally underperformed their indexes. Lending The Group's net lending to the public and credit institutions other than banks and the National Debt Office, excluding repurchase agreements (repos), amounted to approximately SEK 640 billion (600) as of December 31, an increase of SEK 40 billion or 7 percent since the beginning of the year, of which approximately SEK 20 billion or 4 percent pertains to Swedish operations. Lending by Hansapank and FIH totaled SEK 97 billion (77). Approximately SEK 5 billion of the increase is due to fluctuating exchange rates. Loans to the household sector amounted to SEK 289 billion (270), a gain of SEK 19 billion or 7 percent. Slightly over 96 percent of the increase represents mortgage lending by Spintab. The increase relates mainly to private and agricultural loans arranged through the Swedish branch office network. Hansapank's household lending rose by SEK 2.5 billion. The Group's exposure to companies in the IT and telecommunications industries amounted to SEK 9.3 billion (8.3) as of December 31, 2001. The large part of the exposure relates to large, well-known Nordic telecommunications companies. The exposure to Argentina amounted to SEK 119 M (192) as of year-end, of which provisions cover SEK 63 M (0). Lending, the Group SEK billion Dec 31 Dec 31 2001 2000 Households 288.9 270.1 Of which Spintab 228.2 210.1 Real estate management 135.5 131.1 Retail, hotels, restaurants 24.9 23.5 Construction 11.0 9.6 Manufacturing 51.4 43.7 Transportation 14.2 11.5 Forestry and agriculture 28.1 25.4 Other service businesses 16.7 15.6 Other business lending, 46.6 42.8 incl. credit institutions Municipalities *) 13.0 14.3 Other 9.7 12.8 Subtotal 640.0 600.4 Repurchase agreements (repos) 43.5 36.1 Total 683.5 636.5 Of which Hansapank 23.9 15.3 Of which FIH 72.6 61.4 *) As of December 31, 2000 "Other business lending, incl. credit institutions" of SEK 7.5 billion has been reclassified as repurchase agreements (repos). **) Not including municipal companies. Payments Cards FöreningsSparbanken's card operations noted good growth during the year. The number of bank cards in issue rose by 5 percent to approximately 2.6 million at year-end (2.5). Customers' card use continues to rise as well. The number of card transactions cleared climbed by 34 percent to SEK 235 million (176). Giro The Bank's customers are increasingly switching from paper-based giro payments to an electronic, Internet-based giro system via FöreningsSparbanken by Internet. The number of private customers with giro accounts rose during the year to 2.6 million (2.5), of whom 760,000 (570,000) are Internet-based. The share of Internet-based giro transactions rose from 25 to 32 percent compared with 2000. e-billing With e-billing, bills are sent directly to customers' online bank accounts, where they can safely and conveniently approve payment. During the fourth quarter 7 more companies signed on for the service, bringing the total to 92. Agreements have been signed with another 24 companies that will offer e-billing to their customers. The number of e-bills rose from 59,000 to 243,000 compared with last year. Retail The Retail business area is FöreningsSparbanken's sales organization for the Swedish market. Retail is responsible for customer contacts with the Bank's target groups: private customers, small and medium-size businesses, municipalities, county councils and organizations. Retail includes local banks, FöreningsSparbanken by Telephone and FöreningsSparbanken by Internet. Local banks The Swedish branch network is organized into 95 local banks in 7 regions around the country. With its 553 branches, FöreningsSparbanken has the largest network of any Swedish bank. The cooperation with the partly owned and independent savings banks adds another 333 branches. The branch network is complemented by 305 in-store banking locations and the agreement with Posten, the Swedish postal service, whereby customers can receive help with certain transactions at 1,310 post offices and through approximately 2,700 rural mailcarriers. FöreningsSparbanken by Telephone As of year-end approximately 1,220,000 customers (1,049,000) had signed up for FöreningsSparbanken by Telephone with personal assistance, an increase of 171,000 or 16 percent compared with year-end 2000. The number of telephone banking customers who use the self-service option was 2.0 million (1.9). The number of self-service visits to the telephone bank decreased by 4 percent compared with 2000. The number of visitors to the telephone bank using personal assistance rose by 3 percent during the year. Swedbank Markets Swedbank Markets is the Bank's Investment and Merchant Banking unit responsible for institutional and large corporate customers. The business area offers trading in securities and derivatives in the equity, fixed income and currency markets as well as financing solutions and professional analysis and advice. The analysis unit issues a steady stream of analyses on around 150 Nordic companies. For individual investors, Swedbank Markets offers stock trading and broad-market products, such as equity-linked bonds, through the Group's Swedish branch network, independent savings banks, partly owned banks, FöreningsSparbanken by Internet and FöreningsSparbanken by Telephone. The fixed income and foreign exchange trading operations maintained or raised their overall market shares during the year. Swedbank Markets was the third largest player on Stockholmsbörsen during the year in terms of transactions and the seventh largest in volume. As of December 31 NetTrade - the Bank's online brokerage service - had just over 56,000 customers, a gain of 30 percent during the year. NetTrade accounted for 35 (27) percent of stock-transactions at local banks. Alliances Denmark In December FöreningsSparbanken acquired an additional 2.5 percent of the shares in FI-Holding (which in turn owns nearly 100 percent of FIH), thereby increasing its holding in the Danish credit institution from 64.7 to 67.2 percent. FöreningsSparbanken paid SEK 225 M for 24,975 shares. Since year-end 2001, FöreningsSparbanken has acquired an additional 2.5 percent of the shares in FI-Holding. FIH's operating profit amounted to SEK 1,030 M (794) in 2001. The return on equity was 11.7 percent (10.9). Lending to the public amounted to SEK 73 billion (61), with total assets of SEK 89 billion (78). Baltic states FöreningsSparbanken owns nearly 58 percent of Estonia's Hansapank. The Hansapank Group reported an operating profit for the year of SEK 1,039 M (697). Its return on equity was 25.3 percent (24.0). Deposits from the public amounted to SEK 31 billion (17) at year-end, while lending to the general public totaled SEK 24 billion (15). Total assets were SEK 43 billion (26) on the same date. LTB, which was acquired by Hansapank in 2001, had deposits from the public of SEK 8 billion on December 31, 2001, and loans to the public of SEK 2 billion. LTB's share of the Hansapank Group's profit was marginal. Norway FöreningsSparbanken owns 25 percent of SpareBank 1 Gruppen. Together with its Norwegian co-owner banks, Sparebank 1 Gruppen is the fourth largest banking and financial group in Norway. Earnings for the group's insurance operations were affected by falling stock prices. Goodwill amortization attributable to the acquisition of VÅR-gruppen in the previous year also had a negative effect on earnings. FöreningsSparbanken plans to expand its alliance with Sparebank1 Gruppen. With the goal of signing a new long-term cooperation agreement in 2002, FöreningsSparbanken in December 2001 cancelled the current agreement signed in 1998. This cooperation agreement remains in force for one year after its cancellation. Finland FöreningsSparbanken owns just under 25 percent of Aktia Sparbank in Finland. Aktia releases its year-end report on February 18, 2002. The reported share of Aktia's profit pertains to the full-year. For the first nine months of 2001Aktia reported operating profit of SEK 248 M (309). Its return on equity was 15.9 percent (28.6). Deposits amounted to SEK 18 billion (16), while lending totaled SEK 20 billion kronor (17). Total assets as of September 30, 2001 amounted to SEK 33 billion (26). E-business Marakanda Work with Marakanda, the e-commerce venture jointly owned with Telia, is progressing according to plan. Marakanda utilizes a combination of Telia's technical solutions and FöreningsSparbanken's local presence and established Internet banking solutions. Through Marakanda, the Bank and its municipal and business customers create new business opportunities and greater customer value. During the year the number of municipalities and external companies that utilize Marakanda's purchasing- and travelservices rose to approximately 60 and the number of companies that have signed up as suppliers of goods and services climbed to approximately 100. The Group's Internet banking services Dec 31 Dec 31 2001 2000 Number of customers in Sweden 1,079,000 814,000 Of whom private customers 945,000 691,000 Of whom business customers 88,000 58,000 Of which the telephone bank via the 46,000 65,000 Internet Number of Baltic customers 430,000 214,000 Total number of customers 1,509,000 1,028,000 Customers' Internet use continues to rise The number of Internet payments rose during the year from 32 million to 51 million. Of the giro payments during the year, 32 percent (25) were made online. 22 percent (22) of the total number of mutual fund purchases and redemptions within the Group were made via the Internet as well. Internet ID service The cooperation with other banks to create a common ID service based on soft certificates continued during the year. The concept and its guidelines have been established and positively received by the market. The construction of the technical environment to handle the service was begun last autumn and is expected to be completed in 2002. FöreningsSparbanken was one of the six suppliers with which the Swedish Agency for Administrative Development signed framework agreements in December to supply services for electronic identification and signatures. Other Securitization of agricultural loans for over SEK 14 billion FöreningsSparbanken's subsidiary Spintab was the first institution in the Nordic region to implement a synthetic securitization. The transaction involves the loan portfolio of Spintab's subsidiary, Jordbrukskredit, and has an equivalent value of slightly more than SEK 14 billion. This form of securitization differs from traditional securitization in that the loans are retained on the balance sheet, while portions of the credit risk, as with traditional securitization, are shifted to the capital market. The securitization offers a more efficient use of capital within the FöreningsSparbanken Group. The primary capital ratio improved by 0.1 percentage point and the capital adequacy ratio improved by 0.2 percentage points as a result of the securitization. Dividend The Bank's Board of Directors is recommending that the Annual General Meeting approve an unchanged cash dividend of SEK 5.50 per share (5.50). The proposed record day for the 2001 dividend is Tuesday, April 16, 2002. The last day for trading in the Bank's share with the right to the dividend is Thursday, April 11, 2002. If the Annual General Meeting adopts the Board's recommendation, the cash dividend is expected to be paid by VPC (the Swedish Securities Register Center) on Friday, April 19, 2002. Annual General Meeting FöreningsSparbanken's Annual General Meeting will be held at 2:00 p.m. (CET) on Thursday, April 11, 2002 at Tonhallen, Fabriksgatan 22 in Sundsvall. Shareholders who wish to attend must be directly recorded in the Bank's share register maintained by VPC by Thursday, March 28. Accounting change The preliminary year-end report has been prepared in accordance with recommendation RR 20 of the Swedish Financial Accounting Standards Council and follows the same accounting principles as the most recent annual report, with the exceptions that comply with the Swedish Financial Supervisory Authority's amended principles for insurance companies, which simplify consolidation. Figures for comparative periods have been restated. As of 2001 an operational profit and loss account has been introduced. The operational profit and loss account comprises the same legal entities and follows the same accounting principles as the legal profit and loss account, except that the items related to the insurance operations are integrated into the income and expenses of other operations. The descriptions in the running text of this report are based on the operational profit and loss account, unless indicated otherwise. The business area review is also based on the operational accounts. Highlights after December 31, 2001 FöreningsSparbanken expands its interest in FI-Holding On February 8 FöreningsSparbanken acquired an additional 2.5 percent of the shares in FI-Holding (which in turn owns nearly 100 percent of FIH), thereby increasing its holding from 67.2 percent to 69.7 percent. FöreningsSparbanken paid SEK 222 M for 25,025 shares. Key ratios, the Group 2001 2000 Return on equity, % 14.7 19.7 Return on total equity, % 0.82 1.04 Earnings per share * 9.86 12.10 Earnings per share after 9.85 12.08 dilution ** Equity per share *, SEK 71.02 66.22 Equity per share after dilution 70.92 66.11 **, SEK I/C ratio before loan losses 0.60 0.57 I/C ratio after loan losses 0.66 0.61 Capital adequacy ratio, % 11.3 10.8 Primary capital ratio, % 7.1 6.9 Loan loss ratio, net, % 0.2 0.2 Share of doubtful claims, % 0.0 0.0 Provision ratio for doubtful 103 105 claims, %*** No. of shares at beginning of 527,808,843 527,808,843 period No. of shares at end of period 527,808,843 527,808,843 Avg. no. of shares during the 527,808,843 527,808,843 period * No. of shares in calculation 527,808,843 527,808,843 ** No. of shares after dilution 528,504,316 528,697,422 *** See Note 5 ------------------------------------------------------------ This information was brought to you by Waymaker http://www.waymaker.net The following files are available for download: http://www.waymaker.net/bitonline/2002/02/14/20020214BIT00960/bit0002.doc The full year-end report http://www.waymaker.net/bitonline/2002/02/14/20020214BIT00960/bit0002.pdf The full year-end report