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2011-08-23 10:28:52 CEST 2011-08-23 10:29:54 CEST REGULATED INFORMATION Kuntarahoitus Oyj - Interim report (Q1 and Q3)INTERIM REPORT BULLETIN 1 January - 30 June 2011Municipality Finance increasingly attractive as an investment Municipality Finance Plc (MuniFin) has retained its strong market position in the first half of 2011 as the leading financier for its clients, Finnish municipalities and government-subsidised housing production. During this period, the company acquired EUR 5.1 billion in funds from international investors (compared with EUR 3.2 billion for the period 1 January - 30 June 2010), which represents around three quarters of the funding needed by MuniFin for the whole year. This success in acquiring funds is partly due to the fact that Finland has become significantly more attractive as investments amid increasing economic insecurity in Europe. Finland is regarded as a safe haven for investments, which is evidenced in the good availability of both shorter- and longer-term funding. In practice, the funding being offered to MuniFin currently exceeds requirements. The first inaugural USD benchmark issue from MuniFin In May, MuniFin successfully launched its inaugural USD 1.5 billion benchmark issue. Over 50% of the transaction was sold to central banks from various countries, with over a third of the total being sold to Asia. Over 40 investors from around the world participated in the issue. This transaction significantly diversified company's funding base further, while also enabling the company to join the ranks of leading global bond issuers. MuniFin, which enjoys the highest credit ratings, is a particularly sought-after partner among the largest financial players. Lending remains at previous year's level New lending by MuniFin increased by 4.7% to EUR 1.476 billion (1 Jan - 30 Jun 2010: EUR 1.410 billion) during the first six months of the year. This increase was moderate, and there were no great changes in municipalities' funding requirements. The total loan portfolio at the end of June was EUR 12.6 billion (31 Dec 2010: EUR 11.7 billion). The Municipality Finance Group's net operating profit for the period was EUR 35.0 million (1 Jan - 30 Jun 2010: EUR 30.5 million) and net interest income was EUR 41.0 million (1 Jan - 30 Jun 2010: EUR 38.1 million). The Group's risk bearing capacity remained strong: its capital adequacy ratio stood at 22.83% at the end of June (31 Dec 2010: 19.28%) and its capital adequacy for Tier 1 capital was 16.90% (31 Dec 2010: 13.92%). President and CEO Pekka Averio said: “The proper functioning of the financing system for municipalities and social housing production must be secured competitively in all conditions. It is worth noting that the new Finnish government programme specifically mentions MuniFin's role in providing funding for local government and state subsidised housing production. This reflects genuine concern over the need to ensure local government and social housing production under all circumstances and the importance of competitive local government funding.” Municipality Finance Plc For further information, contact: Pekka Averio, President and CEO, tel. +358 (0)500 406 856 Esa Kallio, Executive Vice President, Deputy to CEO, tel. +358 (0)50 337 7953 The Interim Report of Municipality Finance can be found on the internet at www.munifin.fi. |
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