Pohjola Pankki Oyj - Interim report (Q1 and Q3)

Strong growth in OP-Pohjola Group's earnings and market position

OP-Pohjola Group
Stock Exchange Release 30 October 2013 at 8.00 am
Interim Report

Strong growth in OP-Pohjola Group's earnings and market position

- Earnings before tax increased by 28% to EUR 614 million (481). Earnings before
tax for January-September already exceeded those for the full year 2012.
Earnings before tax for the third quarter were €216 million (153), an increase
of 42 per cent on the year-ago figure.
- Total income increased by 8%. Net interest income continued its growth path.
- Total expenses remained at the previous year's level. Excluding the bank levy,
expenses would have decreased by 3%.
- Core Tier 1 ratio improved to 14.9% (14.8).
- The Group continued to strengthen its market position. In the year to
September, the loan portfolio grew by 5.9%, deposits by 7.2%, mutual fund assets
by 23% and Non-life Insurance premiums written by 10%.
- The number of joint banking and non-life insurance customers increased by
103,000 in the year to September.
- Change in the outlook: Earnings before tax for full 2013 are expected to be
markedly better than a year ago. For more information, see "Outlook for the rest
of 2013".


OP-Pohjola Group's key indicators
--------------------------------------------------------------------------------
                                    Q1-Q3/2013  Q1-Q3/2012 Change, %        2012
--------------------------------------------------------------------------------
Earnings before tax, € million             614         481      27.5         586

   Banking                                 323         345      -6.5         424

   Non-life Insurance                      162          82      97.6          92

   Wealth Management                        98          74      32.2         101



Returns to owner-members and OP
bonus customers                            145         142       1.6         192



                                   30 Sep 2013 30 Sep 2012 Change, % 31 Dec 2012

Core Tier 1 ratio before the              14.9        15.1     -0.2*        14.8
transition provisions, %

Core Tier 1 ratio, %                      13.9        14.8     -0.9*        14.1

Ratio of capital base to minimum          1.86        2.01    -0.15*        1.90
amount of capital base (under the
Act on the Supervision of
Financial and Insurance
Conglomerates)

Ratio of non-performing                   0.49        0.55    -0.06*        0.46
receivables to loan and guarantee
portfolio, %

Joint banking and
insurance customers  (1,000)             1,491       1,388       7.4       1,425
--------------------------------------------------------------------------------
* Change in ratio

Comments by Reijo Karhinen, Executive chairman and CEO

OP-Pohjola Group's key figures are again a sign of our very strong performance
this year. Our capital adequacy, earnings and growth figures are high in terms
of their level and are well-balanced. Thanks to our considerably better earnings
than we expected, our strong capital adequacy has even improved slightly,
although growth that ties up our capital has continued at a rate faster than the
market average. From the viewpoint of a customer-owned financial services group,
I would describe our performance so far this year as optimal.

Following a good third quarter, we estimate that our full-year results will be
clearly better than a year ago. This estimate, using figures available so far
this year, is based on the performance that is already better than the full year
2012 performance, continued strict control of expenses and net interest income
that has begun to increase. We have a solid risk exposure and low loan losses.

The upcoming regulatory framework will highlight the importance of capital
adequacy in banking, which is automatically reflected in the increasing role of
profit performance. However, we are not seeking profit at the expense of growth
but in order to ensure it on a long-term basis. We will maintain our profit
performance and price competitiveness primarily by making our operations and
processes more efficient. We cannot afford to increase our expenses in the next
few years.

OP-Pohjola Group has continued to increase its particularly strong market
position of recent years, and this trend has also continued this year. Again,
within the last 12 months, we managed to obtain over 100,000 new joint banking
and non-life insurance customers thanks to successful cross-selling. Already
more than 70 per cent of Pohjola Insurance's customers also use OP-Pohjola
Group's banking services.

Another key reason for our success, arising particularly in the recent uncertain
operating environment, is the fact that we carry our responsibility for the
financial management of Finnish households and businesses. That the growth in
euro terms of OP-Pohjola Group's housing loans represented 80 per cent of the
growth within the sector is strong proof that what we do is in line with our
promises. And in terms of on-balance-sheet corporate financing, we came close to
100 per cent.

Our strong profit performance and market position development during January-
September have shown that we have had the desire and ability to work on a long-
term basis and to listen to our customers. What our customers need on a daily
basis is still at the heart of how we operate. According to our mission, we must
be able to offer our customers genuine added value. We should also be able to
see our own operations from the viewpoint of our customers. Easy use of our
services and the right service attitude form the basis of a good customer
experience.

Our success story gives us the opportunity to look into the future with
confidence and with a positive approach. We will continue to put unprecedented
efforts into product and service development. OP Mobile's growth into becoming
the primary point of access for private banking customers is ongoing. Users
value our mobile services very highly, and the innovative Pivo service is a
forerunner in smart wallets. With Omasairaala hospital, we are leading the way
in the development of healthcare processes.

OP-Pohjola Group is firmly rooted in Finland, so it is delightful to see that
the country's economic policy is finally being adjusted. Now Finland needs to
proceed with determination. The journey has only begun. Economic confidence has
improved markedly in the rest of Europe, but deteriorated in Finland. Finland
has to be aware of the crisis to take the necessary decisions, but this stage
must be passed quickly, because the uncertainty and consequent low confidence
and negative atmosphere are eating up consumer spending and capital spending. To
improve overall sentiment, Finland not only needs a successful collective
agreement but also systematic implementation of the Government's structural
programme.

Financial performance in the reporting period

OP-Pohjola Group's earnings before tax were EUR 614 million (481). Earnings were
improved especially because of a solid increase in investment income due to
capital gains on securities, the good financial performance of Non-Life
Insurance and an increase in net commissions and fees. The good performance of
Non-life Insurance was the result of premiums written that have been increasing
for a long time and of lower operating expenses. Life Insurance's performance
was better than a year ago thanks to capital gains and the acquisition of Aurum
Investment Insurance Ltd. The fact that growth in expenses has come to a halt
has contributed to the improved results of the entire Group.

Due to low interest rates, net interest income decreased by 14% year on year.
The decrease in net interest income slowed down in the second quarter and net
interest income began to increase slightly during the third quarter.

The Group's expenses were at the same level as last year despite the EUR 35
million bank levy and the growth and expansion of business. Without the effect
of the bank levy, total expenses would have decreased by more than 3%.  Thanks
to measures taken in the efficiency-enhancement programme, wages and salaries
decreased by more than 6% in net terms. Because pension costs increased,
personnel costs as a whole decreased by 4%. A non-recurring provision for
expenses of EUR 20 million related to the efficiency-enhancement programme of
OP-Pohjola Group Central Cooperative Consolidated increased personnel costs a
year ago. Other administrative expenses were almost 6% lower than a year ago.

OP-Pohjola Group's fair value reserve before tax totalled EUR 371 million (449)
on 30 September. Earnings before tax at fair value were EUR 536 million (1,042).

Bonuses to owner-members and OP bonus customers recognised in the income
statement increased by 5.4% year on year to EUR 136 million.

Outlook for the rest of 2013
The world economy is recovering but growth is expected to remain slower than
usual. Not only the euro-area economy but also the Finnish economy has shown a
slight improvement. As a result of the actions taken by the ECB, financial
markets have remained relatively stable. Despite the slight improvement, risks
associated with economic development are higher than usual, and the economy may
turn for worse than expected in quite a short period.

The operating environment in the financial sector is gradually improving
although historically low interest rates are eroding banks' net interest income
and will weaken insurance institutions' investment income. The economic
recession has not increased loan losses in the banking sector by more than a
fraction. The bank levy confirmed at the end of last year has caused major new
costs to Finnish banks. Changes in the operating environment and the more
rigorous regulatory framework will highlight the role of measures to strengthen
the capital base and improve profitability.

Unless the operating environment turns out to be considerably weaker than
expected, OP-Pohjola Group's earnings before tax for 2013 are expected to be
markedly better (previous estimate: better) than in 2012. The most significant
factors that may affect earnings in the rest of the year concern changes in
capital markets.

All forward-looking statements in this report expressing the management's
expectations, beliefs, estimates, forecasts, projections and assumptions are
based on the current view of developments in the economy, and actual results may
differ materially from those expressed in the forward-looking statements.

Press conference
OP-Pohjola Group's financial performance will be presented to the media by
Executive Chairman and CEO Reijo Karhinen in a press conference on 30 October
2013, starting at noon at Vääksyntie 4, Vallila, Helsinki.
Pohjola Bank plc will publish its own interim report.


Financial reporting in 2014
Schedule for Financial Statements Bulletin for 2013 and Interim Reports in
2014:
Financial Statements Bulletin 2013:  6 February 2014
Interim Report Q1/2014: 29 April 2014
Interim Report H1/2014:  6 August 2014
Interim Report Q1-3/2014: 29 October 2014

OP-Pohjola Group Central Cooperative
Executive Board

ADDITIONAL INFORMATION
Reijo Karhinen, Executive Chairman and CEO, tel. +358 (0)10 252 4500

Harri Luhtala, CFO, tel. +358 (0)10 252 2433
Carina Geber-Teir, Chief Communications Officer, tel. +358 (0)10 252 8394

DISTRIBUTION
NASDAQ OMX Helsinki Ltd
London Stock Exchange
SIX Swiss Exchange
Major media
op.fi and pohjola.com

OP-Pohjola Group is Finland's leading financial services group providing a
unique range of banking, investment and insurance services. The Group has the
mission of promoting the sustainable prosperity, well-being and security of its
owner-members, customers and operating regions through its local presence. Its
objective is to offer the best and most versatile package of loyal customer
benefits on the market. OP-Pohjola Group consists of some 200 member cooperative
banks and the Group's central institution, OP-Pohjola Group Central Cooperative,
with its subsidiaries and closely-related companies, the largest of which is the
listed company Pohjola Bank plc. With a staff of 13,000 OP-Pohjola Group posted
consolidated earnings of 601 million euros before tax in 2012 and had total
assets of 99.8 billion euros on 31 December 2012. The group has over four
million customers.


[HUG#1739080]

Attachments:

OP-Pohjola Group Q3 2013 background material.pdf

OP-Pohjola Group Interim Report Q3_2013.pdf