2017-11-01 09:00:00 CET
2017-11-01 09:00:30 CET
BIRTINGARSKYLDAR UPPLÝSNINGAR
OP Mortgage Bank - Interim report (Q1 and Q3)
OP Mortgage Bank: Interim Report for January-September 2017
OP MORTGAGE BANK
Interim Report
1 November 2017 at 10.00 am EET
OP Mortgage Bank: Interim Report for January-September 2017
OP Mortgage Bank (OP MB) is part of OP Financial Group and its role is to raise,
together with OP Corporate Bank plc, funding for the Group from money and
capital markets. OP MB is responsible for the Group's funding for the part of
covered bond issuance.
Financial standing
The intermediate loans and loan portfolio of OP MB increased to EUR 11,913
million (10,892)* during the reporting period. OP MB issued one fixed-rate
covered bond with a maturity of seven years in international capital markets in
March and another with a maturity of ten years in June. OP MB intermediated the
bonds with a nominal value of EUR 1,000 million in intermediate loans in their
entirety to OP cooperative banks. On 30 September, OP cooperative banks had a
total of EUR 3,863 million (1,853) in intermediate loans from OP MB.
The company's financial standing remained stable throughout the reporting
period. Operating profit for January- September amounted to EUR 13.2 (16.0)
million.
*The comparatives for 2016 are given in brackets. For income statement and other
aggregated figures, January-September 2016 figures serve as comparatives. For
balance-sheet and other cross-sectional figures, figures at the end of the
previous financial year (31 December 2016) serve as comparatives.
Collateralisation of bonds issued to the public
On 30 September 2017, loans as collateral in security of the covered bonds
issued under the Euro Medium Term Covered Note programme worth EUR 15 billion
established on 12 November 2010 under the Laki kiinnityspankkitoiminnasta
(688/2010) (Covered Bond Act) totalled EUR 11,488 million.
Capital adequacy
OP MB has presented its capital base and capital adequacy in accordance with the
EU capital requirement regulation and directive (EU 575/2013). OP MB uses the
Internal Ratings Based Approach (IRBA) to measure its capital adequacy
requirement for credit risk. OP MB uses the Standardised Approach to measure its
capital adequacy for operational risk.
The Common Equity Tier 1 (CET1) ratio stood at 114.6 % (109.5) on 30 September
2017. The CET1 capital requirement is 4.5% and the requirement for the capital
conservation buffer is 2.5%, i.e. the total CET1 capital requirement is 7%. The
minimum total capital requirement is 8% and 10.5% with capital conservation
buffer. Earnings for the financial year were not included in CET1 capital.
OP MB's highest minimum capital requirement is determined by the Basel I floor.
OP MB's capital base exceeded the Basel I floor by EUR 50 million in September.
Information on the Basel I floor and capital surplus can be found in note
"Capital base and capital adequacy". The Basel I floor will not apply as of the
beginning of 2018.
The Financial Supervisory Authority has decided to set a 15% minimum risk weight
on housing loans from the beginning of 2018 for at least two years. According to
the Authority, this floor is aimed at preparing for a systemic risk related to
household indebtedness. Contrary to the previous information, the minimum risk
weight floor does not apply to OP MB but applies only to OP Financial Group
level.
Joint and several liability of amalgamation
Under the Act on the Amalgamation of Deposit Banks, the amalgamation of the
cooperative banks comprises the organisation's central cooperative (OP
Cooperative), the central cooperative's member credit institutions and the
companies belonging to their consolidation groups as well as credit and
financial institutions and service companies in which the above together hold
more than half of the total votes. This amalgamation is supervised on a
consolidated basis. On 30 September 2017, OP Cooperative's members comprised
167 member cooperative banks as well as OP Corporate Bank plc, OP MB, OP Card
Company Plc and OP Customer Services Ltd (formerly OP Process Services Ltd).
The central cooperative is responsible for issuing instructions to its member
credit institutions concerning their internal control and risk management, their
procedures for securing liquidity and capital adequacy as well as for compliance
with harmonised accounting policies in the preparation of the amalgamation's
consolidated financial statements.
As a support measure referred to in the Act on the Amalgamation of Deposit
Banks, the central cooperative is liable to pay any of its member credit
institutions an amount that is necessary to prevent the credit institution from
being placed in liquidation. The central cooperative is also liable for the
debts of a member credit institution which cannot be paid using the member
credit institution's assets.
Each member bank is liable to pay a proportion of the amount which the central
cooperative has paid to either another member bank as part of support action or
to a creditor of such member bank in payment of an amount overdue which the
creditor has not received from the member bank. Furthermore, in the case of the
central cooperative's default, a member bank has unlimited refinancing liability
for the central cooperative's debts as referred to in the Co-operatives Act.
Each member bank's liability for the amount the central cooperative has paid to
the creditor on behalf of a member bank is divided between the member banks in
proportion to their last adopted balance sheets. OP Financial Group's insurance
companies do not fall within the scope of joint and several liability.
According to Section 25 of the Covered Bond Act, the holder of a covered bond
has the right to receive a payment for the entire term of the bond from the
assets entered as collateral before other receivables without this being
prevented by OP MB's liquidation or bankruptcy.
Personnel
On 30 September 2017, OP MB had five employees. OP MB purchases all the most
important support services from OP Cooperative and its Group members, reducing
the need for its own personnel.
Administration
The Board composition is as follows:
Chairman Harri Luhtala Chief Financial Officer, OP Cooperative
Members Elina Ronkanen-Minogue Head of Asset and Liability Management and
Group Treasury, OP Cooperative
Hanno Hirvinen Group Treasurer, OP Corporate Bank plc
OP MB's Managing Director is Lauri Iloniemi and Hanno Hirvinen is his deputy.
Risk exposure
The most typical types of risks related to OP MB are credit risk, structural
funding risk, liquidity risk and interest rate risk. The key credit risk
indicators in use show that OP MB's credit risk exposure is stable and the limit
for liquidity risk set by the Board of Directors has not been exceeded. The
liquidity buffer for OP Financial Group, managed by OP Corporate Bank plc, is
exploitable by OP MB. OP MB has used interest rate swaps to hedge against its
interest rate risk. Interest rate swaps have been used to swap housing loan
interest, intermediate loan interest and interest on issued bonds into the same
basis rate. OP MB has entered into all derivative contracts for hedging
purposes, with OP Corporate Bank plc being their counterparty. The interest rate
risk of OP MB may be considered to be low.
Outlook
It is expected that the OP MB's capital adequacy will remain strong, risk
exposure favourable and the overall quality of the loan portfolio good. This
will make it possible to issue new covered bonds in the fourth quarter too.
Accounting policies
The Interim Report for 1 January-30 September 2017 has been prepared in
accordance with IAS 34 (Interim Financial Reporting).
This Interim Report is based on unaudited figures. Given that all figures have
been rounded off, the sum total of individual figures may deviate from the
presented sums.
The Interim Report is available in Finnish and English. The Finnish version is
official that will be used if there is any discrepancy between the language
versions.
OP MB's related parties include the parent company OP Cooperative and its
subsidiaries, the OP Financial Group pension insurance companies OP Bank Group
Pension Fund and OP Bank Group Pension Foundation, and the company's
administrative personnel. Standard loan terms and conditions are applied to
loans granted to the related parties. Loans are tied to generally used reference
interest rates. The reporting period saw no major changes in related-party
transactions.
New standards and interpretations
IFRS 9 Financial Instruments:
OP MB will apply IFRS 9 as of 1 January 2018. The comparatives will not be
restated.
The quantitative effect of the application of the standard on the 2018 financial
statements cannot yet be assessed reliably since it will depend on the amount of
the financial instruments held at that time, the financial position at that time
and the choice of the calculation principles and management judgement. The new
standard requires OP MB to examine the calculation and monitoring processes for
financial instruments. The changes to be made in them are not yet completed. OP
MB has updated the effects of the IFRS 9 transition presented in the financial
statements for 2016, as follows:
Classification and measurement
The changes in the classification of OP MB's financial instruments will be small
and will have no significant effect on OP MB's CET1 ratio.
Impairment
The expected credit losses are calculated on all balance sheet items amortised
at cost and those recognised at fair value through other comprehensive income
(FVOCI) and on off-balance-sheet loan commitments and guarantee agreements.
OP MB's credit risk models and the development of related systems are not yet
finalised. The expected credit losses are calculated using modelled risk
parameters and formula PDxLGDxEAD for the majority of the portfolios. The
expected credit losses are calculated for each contract for 12 months or
lifetime, depending on whether the instrument's credit risk on the reporting day
has increased significantly since initial recognition. OP MB assesses any
significant increase in credit risk through both qualitative and quantitative
criteria. Qualitative factors consist of various credit risk indicators (e.g.
forbearance measures) to be mainly taken into account in credit rating models.
Credit ratings will affect lifetime PDs which are used for quantitative
assessment of a significant increase in credit risk. In addition, credit risk
has increased significantly if payment is over 30 days past due. Contratcts are
classified into three stages. Stage 1 class includes contracts whose credit risk
has not increased significantly from the original level and for which a 12-month
expected loss is calculated. Stage 2 includes contracts whose credit risk has
increased significantly from the original level and for which a lifetime
expected loss is calculated. Stage 3 includes defaulted contracts for which a
lifetime expected loss is also calculated. In the assessment of a significant
increase in credit risk, OP MB does not apply a transitional provision permitted
by IFRS 9 to contracts for which it is not possible, without undue cost or
effort, to calculate the original lifetime PDs. In the definition of default, OP
MB uses a uniform definition in capital adequacy measurement.
OP MB will include forward-looking information and macroeconomic scenarios in
the model. The macroeconomic scenarios are the same that OP MB uses otherwise in
its financial annual planning. Three scenarios will be used: baseline, upside
and downside.
Expected credit loss provisions under IFRS 9 are assessed to increase slightly
from its current level based on IAS 39 and it varies by portfolio. The
provisions will reduce equity capital on the date of transition. Based on
preliminary assessments, the increase in expected credit loss provisions is not
expected to have any significant effect on OP MB's CET1 ratio on the date of
transition because the IFRS 9 compliant expected credit loss provisions are not
expected to exceed the expected loss calculated in capital adequacy and the
effect of used floors. The European Commission's proposal under preparation to
amend the calculation of the CET1 ratio by gradually phasing in the effects of
impairment loss measurement under IFRS 9 during five years will, if implemented,
also reduce the effects on capital adequacy.
Hedge accounting
For portfolio hedges, OP MB will continue to apply hedge accounting under IAS
39. OP MB has not yet made the decision to adopt IFRS 9 compliant hedge
accounting.
IFRS 15 Revenue from Contracts with Customers
OP MB will apply IFRS 15 as of 1 January 2018. This standard will replace the
current IAS 11 and IAS 18. In OP MB, IFRS 15 mainly applies to fees not included
in the calculation of the effective interest rate. The new standard will have no
effect of the revenue recognition of financial instruments. IFRS 15 will lead to
added information presented in the notes to the financial statements. IFRS 15
will not change the revenue recognition time of the fees included the scope of
application of the standard in comparison with the current practices. Thus, the
adoption of IFRS 15 will not have any significant effect on OP MB's financial
result. OP MB will apply IFRS 15 using the retrospective transition method.
Formulas for Alternative Performance Measures
The Alternative Performance Measures Guidelines issued by the European
Securities and Markets Authority (ESMA) came into force on 3 July 2016. The
Alternative Performance Measures are presented to illustrate the financial
performance of business operations and to improve comparability between
reporting periods. They should not be considered to be replacements for the
performance measures defined in IFRS governing financial reporting.
The formulas for the used Alternative Performance Measures are presented below
and they correspond to the previously presented performance indicators in terms
of content.
Return on equity (ROE), % = Annualised profit for the period / Equity capital
(average equity capital at the beginning and end of the period) × 100
Cost/income ratio, % = (Personnel costs + Depreciation/amortisation and
impairment loss + Other operating expenses) / (Net interest income + Net
commission and fees + Net investment income + Other operating income) × 100
+-----------------------------+----------+----------+-------+-------+----------+
|Income statement, TEUR |Q1-Q3/2017|Q1-Q3/2016|Q3/2017|Q3/2016|Q1-Q4/2016|
+-----------------------------+----------+----------+-------+-------+----------+
|Net interest income | 54,735| 56,601| 18,477| 18,562| 76,171|
+-----------------------------+----------+----------+-------+-------+----------+
| Interest income | 49,407| 65,439| 15,207| 19,541| 84,978|
+-----------------------------+----------+----------+-------+-------+----------+
| Interest expenses | -5,328| 8,838| -3,270| 979| 8,807|
+-----------------------------+----------+----------+-------+-------+----------+
|Net comissions and fees | -37,080| -36,110|-12,189|-11,934| -47,757|
+-----------------------------+----------+----------+-------+-------+----------+
|Net investment income | 1| 2| 0| 0| 7|
+-----------------------------+----------+----------+-------+-------+----------+
|Other operating income | 1| 22| | 21| 22|
+-----------------------------+----------+----------+-------+-------+----------+
|Total income | 17,656| 20,514| 6,288| 6,649| 28,443|
+-----------------------------+----------+----------+-------+-------+----------+
|Personnel costs | 241| 243| 72| 72| 321|
+-----------------------------+----------+----------+-------+-------+----------+
|Depreciation/amortisation and| | | | | |
|impairment loss | 627| 627| 209| 209| 836|
+-----------------------------+----------+----------+-------+-------+----------+
|Other operating expenses | 3,352| 3,442| 1,222| 1,331| 4,243|
+-----------------------------+----------+----------+-------+-------+----------+
|Total expenses | 4,221| 4,313| 1,503| 1,613| 5,400|
+-----------------------------+----------+----------+-------+-------+----------+
|Impairment loss on | | | | | |
|receivables | -239| -179| -107| -21| -400|
+-----------------------------+----------+----------+-------+-------+----------+
|Earnings before tax | 13,197| 16,023| 4,678| 5,015| 22,643|
+-----------------------------+----------+----------+-------+-------+----------+
|Income tax expense | 2,639| 3,243| 936| 1,003| 4,566|
+-----------------------------+----------+----------+-------+-------+----------+
|Profit for the period | 10,558| 12,780| 3,742| 4,012| 18,077|
+-----------------------------+----------+----------+-------+-------+----------+
+-----------------------------+----------+----------+-------+-------+----------+
|Statement of comprehensive | | | | | |
|income, TEUR |Q1-Q3/2017|Q1-Q3/2016|Q3/2017|Q3/2016|Q1-Q4/2016|
+-----------------------------+----------+----------+-------+-------+----------+
| | | | | | |
+-----------------------------+----------+----------+-------+-------+----------+
|Profit for the period | 10,558| 12,780| 3,742| 4,012| 18,077|
+-----------------------------+----------+----------+-------+-------+----------+
| | | | | | |
+-----------------------------+----------+----------+-------+-------+----------+
|Items that will not be | | | | | |
|reclassified to profit or | | | | | |
|loss | | | | | |
+-----------------------------+----------+----------+-------+-------+----------+
|Gains/(losses) arising from | | | | | |
|remeasurement of defined | | | | | |
|benefit plans | | | | | -138|
+-----------------------------+----------+----------+-------+-------+----------+
|Income tax on gains/(losses) | | | | | |
|on arising from remeasurement| | | | | |
|of defined benefit plans | | | | | 28|
+-----------------------------+----------+----------+-------+-------+----------+
|Total comprehensive income | 10,558| 12,780| 3,742| 4,012| 17,967|
+-----------------------------+----------+----------+-------+-------+----------+
+-------------------------+----------+----------+-------+-------+----------+
|Key ratios |Q1-Q3/2017|Q1-Q3/2016|Q3/2017|Q3/2016|Q1-Q4/2016|
+-------------------------+----------+----------+-------+-------+----------+
|Return on equity (ROE), %| 3.8| 4.6| 5.3| 4.4| 4.8|
+-------------------------+----------+----------+-------+-------+----------+
|Cost/income ratio, % | 24| 21| 24| 24| 19|
+-------------------------+----------+----------+-------+-------+----------+
+--------------------------------------------------------+----------+----------+
|Cash flow from operating activities, TEUR |Q1-Q3/2017|Q1-Q3/2016|
+--------------------------------------------------------+----------+----------+
|Profit for the financial year | 10,558| 12,780|
+--------------------------------------------------------+----------+----------+
|Adjustments to profit for the financial year | 9,011| 2,656|
+--------------------------------------------------------+----------+----------+
|Increase (-) or decrease (+) | | |
|in operating assets |-1,005,353| -90,568|
+--------------------------------------------------------+----------+----------+
|Receivables from credit institutions |-2,010,000|-1,119,400|
+--------------------------------------------------------+----------+----------+
|Receivables from the public and public-sector entities | 989,451| 994,722|
+--------------------------------------------------------+----------+----------+
|Other assets | 15,196| 34,110|
+--------------------------------------------------------+----------+----------+
|Increase (+) or decrease (-) | | |
|in operating liabilities | 74,875| -126,183|
+--------------------------------------------------------+----------+----------+
|Liabilities to credit institutions and | | |
|central banks | 90,000| -87,000|
+--------------------------------------------------------+----------+----------+
|Other liabilities | -15,125| -39,183|
+--------------------------------------------------------+----------+----------+
| | | |
+--------------------------------------------------------+----------+----------+
|Income tax paid | -3,032| -4,745|
+--------------------------------------------------------+----------+----------+
|Dividends received | 1| 2|
+--------------------------------------------------------+----------+----------+
|A. Net cash from operating activities | -913,939| -201,315|
+--------------------------------------------------------+----------+----------+
|Cash flow from investing activities | | |
+--------------------------------------------------------+----------+----------+
|Purchase of PPE and intangible assets | | |
+--------------------------------------------------------+----------+----------+
|B. Net cash used in investing activities | | |
+--------------------------------------------------------+----------+----------+
|Cash flow from financing activities | | |
+--------------------------------------------------------+----------+----------+
|Increases in debt securities issued | | |
|to the public | 1,986,645| 245,303|
+--------------------------------------------------------+----------+----------+
|Decreases in debt securities issued | | |
|to the public |-1,350,000| |
+--------------------------------------------------------+----------+----------+
|Dividends paid and interest on cooperative capital | -9,038| -16,282|
+--------------------------------------------------------+----------+----------+
|C. Net cash used in financing activities | 627,608| 229,021|
+--------------------------------------------------------+----------+----------+
|D. Effect of foreign exchange rate changes on cash and | | |
|cash equivalents | 0| 0|
+--------------------------------------------------------+----------+----------+
|Net change in cash and cash equivalents (A+B+C+D) | -286,332| 27,705|
+--------------------------------------------------------+----------+----------+
|Cash and cash equivalents at year-start | 451,787| 245,120|
+--------------------------------------------------------+----------+----------+
|Cash and cash equivalents at year-end | 166,082| 273,453|
+--------------------------------------------------------+----------+----------+
|Change in cash and cash equivalents | -285,705| 28,332|
+--------------------------------------------------------+----------+----------+
| | | |
+--------------------------------------------------------+----------+----------+
|Interest received | 65,156| 99,282|
+--------------------------------------------------------+----------+----------+
|Interest paid | 9,919| 47,808|
+--------------------------------------------------------+----------+----------+
|Adjustments to profit for the financial year | | |
+--------------------------------------------------------+----------+----------+
|Non-cash items | | |
+--------------------------------------------------------+----------+----------+
|Unrealised net gains on foreign exchange operations | 0| 0|
+--------------------------------------------------------+----------+----------+
|Impairment losses on receivables | 239| 181|
+--------------------------------------------------------+----------+----------+
|Other | 8,771| 2,474|
+--------------------------------------------------------+----------+----------+
|Total adjustments | 9,011| 2,656|
+--------------------------------------------------------+----------+----------+
|Cash and cash equivalents | | |
+--------------------------------------------------------+----------+----------+
|Receivables from credit institutions payable on demand | 166,082| 273,453|
+--------------------------------------------------------+----------+----------+
|Total cash and cash equivalents | 166,082| 273,453|
+--------------------------------------------------------+----------+----------+
+---------------------------------------+------------+------------+------------+
|Balance sheet, TEUR |30 Sep. 2017|30 Sep. 2016|31 Dec. 2016|
+---------------------------------------+------------+------------+------------+
| | | | |
+---------------------------------------+------------+------------+------------+
|Receivables from credit institutions | 4,028,851| 2,136,222| 2,304,556|
+---------------------------------------+------------+------------+------------+
|Derivative contracts | 148,566| 322,942| 220,461|
+---------------------------------------+------------+------------+------------+
|Receivables from customers | 8,050,192| 8,614,076| 9,039,563|
+---------------------------------------+------------+------------+------------+
|Investments assets | 40| 40| 40|
+---------------------------------------+------------+------------+------------+
|Intangible assets | 1,113| 1,948| 1,739|
+---------------------------------------+------------+------------+------------+
|Other assets | 41,016| 44,713| 56,212|
+---------------------------------------+------------+------------+------------+
|Tax assets | 852| 196| 460|
+---------------------------------------+------------+------------+------------+
|Total assets | 12,270,630| 11,120,137| 11,623,031|
+---------------------------------------+------------+------------+------------+
|Liabilities to credit institutions | 1,978,000| 1,288,000| 1,888,000|
+---------------------------------------+------------+------------+------------+
|Derivative contracts | 32,915| 5,094| 6,233|
+---------------------------------------+------------+------------+------------+
|Debt securities issued to the public | 9,822,322| 9,389,287| 9,277,801|
+---------------------------------------+------------+------------+------------+
|Provisions and other liabilities | 62,250| 69,301| 77,375|
+---------------------------------------+------------+------------+------------+
|Tax liabilities | | 19| |
+---------------------------------------+------------+------------+------------+
|Total liabilities | 11,895,488| 10,751,702| 11,249,409|
+---------------------------------------+------------+------------+------------+
|Shareholders' equity | | | |
+---------------------------------------+------------+------------+------------+
| Share capital | 60,000| 60,000| 60,000|
+---------------------------------------+------------+------------+------------+
| Reserve for invested unrestricted | | | |
|equity | 245,000| 245,000| 245,000|
+---------------------------------------+------------+------------+------------+
| Retained earnings | 70,142| 63,435| 68,622|
+---------------------------------------+------------+------------+------------+
|Total equity | 375,142| 368,435| 373,622|
+---------------------------------------+------------+------------+------------+
|Total liabilities and shareholders' | | | |
|equity | 12,270,630| 11,120,137| 11,623,031|
+---------------------------------------+------------+------------+------------+
+---------------------------------------+------------+------------+------------+
|Off-balance-sheet commitments, TEUR |30 Sep. 2017|30 Sep. 2016|31 Dec. 2016|
+---------------------------------------+------------+------------+------------+
|Irrevocable commitments given on behalf| | | |
|of customers | 3| 19| 8|
+---------------------------------------+------------+------------+------------+
+--------------------+-------------+--------------+---------------+------------+
|Statement of changes| | | Retained| |
|in equity, TEUR |Share capital|Other reserves| earnings|Total equity|
+--------------------+-------------+--------------+---------------+------------+
| | | | | |
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity| | | | |
|1 Jan. 2016 | 60,000| 245,000| 66,937| 371,937|
+--------------------+-------------+--------------+---------------+------------+
|Reserve for invested| | | | |
|unrestricted equity | | | | |
+--------------------+-------------+--------------+---------------+------------+
|Profit for the | | | | |
|period | | | 12,780| 12,780|
+--------------------+-------------+--------------+---------------+------------+
|Total comprehensive | | | | |
|income | | | | |
+--------------------+-------------+--------------+---------------+------------+
|Other changes | | | -16,282| -16,282|
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity| | | | |
|30 Sep. 2016 | 60,000| 245,000| 63,435| 368,435|
+--------------------+-------------+--------------+---------------+------------+
| | | | | |
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity| | | | |
|1 Jan. 2017 | 60,000| 245,000| 68,622| 373,622|
+--------------------+-------------+--------------+---------------+------------+
|Reserve for invested| | | | |
|unrestricted equity | | | | |
+--------------------+-------------+--------------+---------------+------------+
|Profit for the | | | | |
|period | | | 10,558| 10,558|
+--------------------+-------------+--------------+---------------+------------+
|Total comprehensive | | | | |
|income | | | | |
+--------------------+-------------+--------------+---------------+------------+
|Other changes | | | -9,038| -9,038|
+--------------------+-------------+--------------+---------------+------------+
|Shareholders' equity| | | | |
|30 Sep. 2017 | 60,000| 245,000| 70,142| 375,142|
+--------------------+-------------+--------------+---------------+------------+
OP MB has presented its capital base and capital adequacy in accordance with the
EU capital requirement regulation and directive (EU 575/2013).
+----------------------------------------------+------------+------------+
|Capital base and capital adequacy, TEUR |30 Sep. 2017|31 Dec. 2016|
+----------------------------------------------+------------+------------+
| | | |
+----------------------------------------------+------------+------------+
|Shareholders' equity | 375,142| 373,622|
+----------------------------------------------+------------+------------+
|Common Equity Tier 1 (CET1) before deductions | 375,142| 373,622|
+----------------------------------------------+------------+------------+
|Intangible assets | -1,113| -1,739|
+----------------------------------------------+------------+------------+
|Excess funding of pension liability | -68| -67|
+----------------------------------------------+------------+------------+
|Share of unaudited profits | -10,558| -18,077|
+----------------------------------------------+------------+------------+
|Impairment loss - shortfall of expected losses| -2,754| -2,612|
+----------------------------------------------+------------+------------+
|Common Equity Tier 1 (CET1) | 360,650| 351,126|
+----------------------------------------------+------------+------------+
|Tier 1 capital (T1) | 360,650| 351,126|
+----------------------------------------------+------------+------------+
|Total capital base | 360,650| 351,126|
+----------------------------------------------+------------+------------+
| | | |
+----------------------------------------------+------------+------------+
|Total risk exposure amount | | |
+----------------------------------------------+------------+------------+
|Credit and counterparty risk | 274,056| 286,845|
+----------------------------------------------+------------+------------+
|Operational risk | 40,554| 33,898|
+----------------------------------------------+------------+------------+
|Total | 314,609| 320,743|
+----------------------------------------------+------------+------------+
| | | |
+----------------------------------------------+------------+------------+
|Key ratios, % | | |
+----------------------------------------------+------------+------------+
|CET1 capital ratio | 114.6| 109.5|
+----------------------------------------------+------------+------------+
|Tier 1 capital ratio | 114.6| 109.5|
+----------------------------------------------+------------+------------+
|Capital adequacy ratio | 114.6| 109.5|
+----------------------------------------------+------------+------------+
| | | |
+----------------------------------------------+------------+------------+
|Basel I floor | | |
+----------------------------------------------+------------+------------+
|Capital base | 360,650| 351,126|
+----------------------------------------------+------------+------------+
|Basel I capital requirements floor | 310,642| 322,006|
+----------------------------------------------+------------+------------+
|Capital buffer for Basel I floor | 50,008| 29,120|
+----------------------------------------------+------------+------------+
+------------------------------------------------------------------------------+
|Classification of financial assets and liabilities 30 Sep. 2017, TEUR |
+------------------+---------------+--------------+--------------+-------------+
| | | Recognised at| | |
| | Loans and | fair value| | |
| | other|through profit| Available| |
|Financial assets | receivables| or loss| for sale| Total|
+------------------+---------------+--------------+--------------+-------------+
|Receivables from | | | | |
|credit | | | | |
|institutions | 4,028,851| | | 4,028,851|
+------------------+---------------+--------------+--------------+-------------+
|Derivative | | | | |
|contracts | | 148,566| | 148,566|
+------------------+---------------+--------------+--------------+-------------+
|Receivables from | | | | |
|customers | 8,050,192| | | 8,050,192|
+------------------+---------------+--------------+--------------+-------------+
|Shares and | | | | |
|participations | | | 40| 40|
+------------------+---------------+--------------+--------------+-------------+
|Other receivables | 41,016| | | 41,016|
+------------------+---------------+--------------+--------------+-------------+
|Other assets | 1,965| | | 1,965|
+------------------+---------------+--------------+--------------+-------------+
|Total | 12,122,024| 148,566| 40| 12,270,630|
+------------------+---------------+--------------+--------------+-------------+
| |
+------------------+---------------+--------------+--------------+-------------+
| | | Recognised at| | |
| | | fair value| | |
|Financial | |through profit| Other| |
|liabilities | | or loss| liabilities| Total|
+------------------+---------------+--------------+--------------+-------------+
|Liabilities to | | | | |
|credit | | | | |
|institutions | | | 1,978,000| 1,978,000|
+------------------+---------------+--------------+--------------+-------------+
|Derivative | | | | |
|contracts | | 32,915| | 32,915|
+------------------+---------------+--------------+--------------+-------------+
|Debt securities | | | | |
|issued to the | | | | |
|public | | | 9,822,322| 9,822,322|
+------------------+---------------+--------------+--------------+-------------+
|Other liabilities | | | 62,250| 62,250|
+------------------+---------------+--------------+--------------+-------------+
|Total | | 32,915| 11,862,573| 11,895,488|
+------------------+---------------+--------------+--------------+-------------+
|Valuation | | | | |
|difference of debt| | | | |
|securities issued | | | | |
|to the public | | | | |
|(difference | | | | |
|between fair value| | | | |
|and carrying | | | | |
|amount) 30 Sep. | | | | |
|2017 | | | 171,700| 171,700|
+------------------+---------------+--------------+--------------+-------------+
+------------------------------------------------------------------------------+
|Classification of financial assets and liabilities 31 Dec. 2016, TEUR |
+------------------+---------------+--------------+--------------+-------------+
| | | Recognised at| | |
| | Loans and | fair value| | |
| | other| through| Available| |
|Financial assets | receivables|profit or loss| for sale| Total|
+------------------+---------------+--------------+--------------+-------------+
|Receivables from | | | | |
|credit | | | | |
|institutions | 2,304,556| | | 2,304,556|
+------------------+---------------+--------------+--------------+-------------+
|Derivative | | | | |
|contracts | | 220,461| | 220,461|
+------------------+---------------+--------------+--------------+-------------+
|Receivables from | | | | |
|customers | 9,039,563| | | 9,039,563|
+------------------+---------------+--------------+--------------+-------------+
|Shares and | | | | |
|participations | | | 40| 40|
+------------------+---------------+--------------+--------------+-------------+
|Other receivables | 56,212| | | 56,212|
+------------------+---------------+--------------+--------------+-------------+
|Other assets | 2,199| | | 2,199|
+------------------+---------------+--------------+--------------+-------------+
|Total | 11,402,530| 220,461| 40| 11,623,031|
+------------------+---------------+--------------+--------------+-------------+
| | | | | |
+------------------+---------------+--------------+--------------+-------------+
| | | Recognised at| | |
| | | fair value| | |
|Financial | | through| Other| |
|liabilities | |profit or loss| liabilities| Total|
+------------------+---------------+--------------+--------------+-------------+
|Liabilities to | | | | |
|credit | | | | |
|institutions | | | 1,888,000| 1,888,000|
+------------------+---------------+--------------+--------------+-------------+
|Derivative | | | | |
|contracts | | 6,233| | 6,233|
+------------------+---------------+--------------+--------------+-------------+
|Debt securities | | | | |
|issued to the | | | | |
|public | | | 9,277,801| 9,277,801|
+------------------+---------------+--------------+--------------+-------------+
|Other liabilities | | | 77,375| 77,375|
+------------------+---------------+--------------+--------------+-------------+
|Total | | 6,233| 11,243,176| 11,249,409|
+------------------+---------------+--------------+--------------+-------------+
|Valuation | | | | |
|difference of debt| | | | |
|securities issued | | | | |
|to the public | | | | |
|(difference | | | | |
|between fair value| | | | |
|and carrying | | | | |
|amount) 31 Dec. | | | | |
|2016 | | | 277,485| 277,485|
+------------------+---------------+--------------+--------------+-------------+
Debt securities issued to the public are carried at amortised cost. The fair
value of these debt instruments has been measured using information available
in markets and employing commonly used valuation techniques. The difference
between the fair value and carrying amount is presented as valuation
difference in the "Classification of financial assets and liabilities" note.
+-------------------+-----------------------------------------------------+
|Derivative | |
|contracts 30 Sep. | Nominal values/residual term to maturity |
|2017, TEUR | |
+-------------------+---------+---------------+-------------+-------------+
| |Less than| 1-5| More than| |
| | 1 year| years| 5 years| Total|
+-------------------+---------+---------------+-------------+-------------+
|Interest rate | | | | |
|derivatives | | | | |
+-------------------+---------+---------------+-------------+-------------+
|Hedging |2,503,604| 7,924,977| 6,882,445| 17,311,026|
+-------------------+---------+---------------+-------------+-------------+
|Total |2,503,604| 7,924,977| 6,882,445| 17,311,026|
+-------------------+---------+---------------+-------------+-------------+
+-------------------+-------------------------+-------------+
| | Fair values | Credit |
+-------------------+---------+---------------+ equivalent |
| | Assets| Liabilities| |
+-------------------+---------+---------------+-------------+
|Interest rate | | | |
|derivatives | | | |
+-------------------+---------+---------------+-------------+
|Hedging | 148,566| 32,915| 325,289|
+-------------------+---------+---------------+-------------+
|Total | 148,566| 32,915| 325,289|
+-------------------+---------+---------------+-------------+
+---------------------------+--------------------------------------------------+
|Derivative contracts 31 | Nominal values/residual term to maturity |
|Dec. 2016, TEUR | |
+---------------------------+---------+-----------+-----------------+----------+
| |Less than| 1-5| More than| |
| | 1 year| years| 5 years| Total|
+---------------------------+---------+-----------+-----------------+----------+
|Interest rate derivatives | | | | |
+---------------------------+---------+-----------+-----------------+----------+
|Hedging |2,759,875| 8,216,977| 6,838,247|17,815,099|
+---------------------------+---------+-----------+-----------------+----------+
|Total |2,759,875| 8,216,977| 6,838,247|17,815,099|
+---------------------------+---------+-----------+-----------------+----------+
+---------------------------+---------------------+-----------------+
| | Fair values | |
+---------------------------+---------+-----------+Credit equivalent|
| | Assets|Liabilities| |
+---------------------------+---------+-----------+-----------------+
|Interest rate derivatives | | | |
+---------------------------+---------+-----------+-----------------+
|Hedging | 220,461| 6,233| 414,976|
+---------------------------+---------+-----------+-----------------+
|Total | 220,461| 6,233| 414,976|
+---------------------------+---------+-----------+-----------------+
+------------------------------------------------------------------------------+
|Financial instruments classification, grouped by valuation technique, TEUR |
+------------------------------------------------------------------------------+
| |
+----------------------------------------+-------------------------------------+
|30 Sep. 2017 | Fair value measurement at year end |
+----------------------------------------+-------------------+---------+-------+
| |Balance sheet value| Level 1|Level 2|
+----------------------------------------+-------------------+---------+-------+
|Recurring fair value measurements of | | | |
|assets | | | |
+----------------------------------------+-------------------+---------+-------+
|Derivate contracts | 148,566| |148,566|
+----------------------------------------+-------------------+---------+-------+
|Total | 148,566| |148,566|
+----------------------------------------+-------------------+---------+-------+
|Recurring fair value measurements of | | | |
|liabilities | | | |
+----------------------------------------+-------------------+---------+-------+
|Derivate contracts | 32,915| | 32,915|
+----------------------------------------+-------------------+---------+-------+
|Total | 32,915| | 32,915|
+----------------------------------------+-------------------+---------+-------+
|Financial liabilities not measured at | | | |
|fair value | | | |
+----------------------------------------+-------------------+---------+-------+
|Debt securities issued to the public | 9,822,322|9,749,832|244,190|
+----------------------------------------+-------------------+---------+-------+
|Total | 9,822,322|9,749,832|244,190|
+----------------------------------------+-------------------+---------+-------+
| |
+----------------------------------------+-------------------------------------+
|31 Dec. 2016 | Fair value measurement at year end |
+----------------------------------------+-------------------+---------+-------+
| |Balance sheet value| Level 1|Level 2|
+----------------------------------------+-------------------+---------+-------+
|Recurring fair value measurements of | | | |
|assets | | | |
+----------------------------------------+-------------------+---------+-------+
|Derivate contracts | 220,461| |220,461|
+----------------------------------------+-------------------+---------+-------+
|Total | 220,461| |220,461|
+----------------------------------------+-------------------+---------+-------+
|Recurring fair value measurements of | | | |
|liabilities | | | |
+----------------------------------------+-------------------+---------+-------+
|Derivate contracts | 6,233| | 6,233|
+----------------------------------------+-------------------+---------+-------+
|Total | 6,233| | 6,233|
+----------------------------------------+-------------------+---------+-------+
|Financial liabilities not measured at | | | |
|fair value | | | |
+----------------------------------------+-------------------+---------+-------+
|Debt securities issued to the public | 9,277,801|9,189,185|366,101|
+----------------------------------------+-------------------+---------+-------+
|Total | 9,277,801|9,189,185|366,101|
+----------------------------------------+-------------------+---------+-------+
OP MB does not hold any transfers between the levels of fair value valuation.
Financial reporting 2018
Schedule for Financial Statements Bulletin for 2017 and Interim Reports in 2018:
Financial Statements Bulletin 2017 8 February 2018
Interim Report Q1/2018 3 May 2018
Interim Report H1/2018 1 August 2018
Interim Report Q1-3/2018 31 October 2018
Helsinki, 1 November 2017
OP Mortgage Bank
Board of Directors
For more information, please contact Managing Director Lauri Iloniemi, tel.
+358 (0)10 252 3541
DISTRIBUTION
LSE London Stock Exchange
OAM, Officially Appointed Mechanism
Major media
op.fi
[]
© 2024 Nasdaq, Inc. All Rights Reserved |