Pohjola Pankki Oyj - Interim report (Q1 and Q3)

Pohjola Group performance for January-June 2015

Pohjola Bank plc
Stock Exchange Release 5 August 2015 at 8.00 am
Interim Report


Pohjola Group performance for January-June 2015
  * Consolidated earnings before tax were EUR 361 million (336) and consolidated
    earnings before tax at fair value amounted to EUR 306 million (393). The
    return on equity was 17.0% (17.2).
  * The Common Equity Tier 1 (CET1) ratio was 13.8% (12.4) as against the target
    of 15%.
  * Earnings reported by Banking improved by 4% year on year. The loan portfolio
    grew by 7% to EUR 15.9 billion (14.9). Earnings included EUR 18 million (8)
    in impairment loss on receivables.
  * Non-life Insurance earnings improved by 9% year on year as a result of an
    increase in investment income. Insurance premium revenue rose by 5% (7).
    Combined ratio was 89.4 (86.1). Operating combined ratio*) was 87.8% (84.5).
    Return on investments at fair value was 1.3% (3.4).
  * Earnings before tax reported by Other Operations improved by 25% year on
    year thanks to higher net investment income and lower expenses in Other
    Operations.
  * Within Wealth Management, earnings remained at the previous year's level.
    Assets under management increased by 7% to EUR 46.3 billion (43.3).
  * Change in the outlook: Consolidated earnings from continuing operations
    before tax in 2015 are expected to be at the same level as or higher than in
    2014 (previous estimate: "at the same level as in 2014"). For more detailed
    information on the outlook, see "Outlook towards the year end" below.
Comparatives deriving from the income statement are based on figures reported
for the corresponding period a year ago. Unless otherwise specified, balance-
sheet and other cross-sectional figures on 31 December 2014 are used as
comparatives.


 Earnings before tax, € million    H1/2015 H1/2014 Change, %  2014
------------------------------------------------------------------
   Banking                             175     167         4   303

   Non-life Insurance                  145     133         9   223

   Other Operations                     28      22        25    20

   Wealth Management                    14      14         2    38

 Group total                           361     336         7   584

 Change in fair value reserve          -55      57              79

 Earnings before tax at fair value     306     393       -22   663



 Equity per share, €                 10.80    9.81           10.38

 Average personnel                   2,485   2,592           2,563
------------------------------------------------------------------
The above figures describe Pohjola Group as a whole without the division into
continuing and discontinued operations.

 Financial targets                               H1/2015 H1/2014    Target 2014
-------------------------------------------------------------------------------
 Return on equity, %                                17.0    17.2        13 14.3

 Common Equity Tier 1 ratio (CET1), % *)            13.8    11.9        15 12.4

 Operating cost/income ratio by Banking, %            26      32      < 35   33

 Operating combined ratio by Non-life Insurance,
 %                                                  87.8    84.5      < 92 84.7

 Operating expense ratio by Non-life Insurance,
 %                                                  18.2    18.1        18 18.4

 Non-life Insurance solvency ratio (under
 Solvency II framework), %**)                        137     137       120  117

 Operating cost/income ratio by Wealth
 Management, %                                        49      49      < 45   42

 Total expenses in 2015 at the same level as at
 the end of 2012                                     249     267   514***)  531

 AA rating affirmed by at least two credit
 rating agencies or credit ratings at least at
 the main competitors' level                           2       2         2    2

 Dividend payout ratio at least 50%, provided
 that CET1 ratio is at least 15%. Dividend
 payout ratio is 30% until CET1 ratio of 15% has
 been achieved.                                                  > 50 (30)   30
-------------------------------------------------------------------------------

*) Operating ratios exclude changes in reserving bases and amortisation on
intangible assets arising from the corporate acquisition.
**) Excluding the effect of transitional provisions.
***) The expense target for 2012 has been adjusted to correspond to the change
in the accounting policies applied as of 1 January 2015 (see Note 1. Accounting
policies).


Outlook towards the year end

The euro-area economy has continued to grow at a moderate rate supported by the
ECB's expansionary monetary policy measures. The fragile economic growth is
expected to continue during the second half too. Economic development in Finland
is expected to remain weak. Structural problems in the Finnish economy,
international political tensions, the Greek debt crisis that has escalated again
and poorer prospects for the emerging economies will cause major uncertainty to
the economic rebound in Finland.

Growth expectations are still moderate in the financial sector. Low interest
rates will erode banks' net interest income and weaken insurance institutions'
investment income. Then again, low interest rates support customers' loan
repayment capacity that has remained stable despite the prolonged period of slow
growth. Capital adequacy and profitability in the financial sector have come to
play an ever-increasing role because of the unstable operating environment and
the tighter regulatory framework.

Despite the uncertainty involved in the operating environment, Pohjola Group's
consolidated earnings from continuing operations before tax in 2015 are expected
to be at the same level as or higher than in 2014 (previous estimate: at the
same level as in 2014). The most significant uncertainties affecting earnings in
2015 relate to the rate of business growth, impairment loss on receivables,
developments in bond and capital markets, the effect of large claims on claims
expenditure and to the discount rate applied to insurance liabilities.

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 the future development in the operating environment
and the future financial performance of Pohjola Group and its various functions,
and actual results may differ materially from those expressed in the forward-
looking statements.


Helsinki, 5 August 2015
Pohjola Bank plc
Board of Directors

This Interim Report is available at www.pohjola.com > Media > Releases.

Financial reporting in 2015

Pohjola Bank plc publishes the following financial information pursuant to the
regular disclosure obligation of a securities issuer:

Schedule for Interim Reports in 2015:
Interim Report Q1-3/2015:  28 October 2015


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


For additional information, please contact
Jouko Pölönen, President and CEO, tel. +358 (0)10 253 2691
Carina Geber-Teir, Executive Vice President, Corporate Communications, tel.
+358 (0)10 252 8394

Pohjola is part of the leading Finnish customer-owned financial services group,
OP Financial Group. Pohjola provides its customers with banking, non-life
insurance and wealth management services. Pohjola is OP Financial Group's
central bank and is, together with OP Mortgage Bank, responsible for OP
Financial Group's funding operations on money and capital markets. As laid down
in the applicable law, Pohjola, its parent company OP Cooperative and the member
credit institutions are ultimately jointly and severally liable for each other's
debts and commitments. The joint liability in OP is prescribed by the Act on the
Amalgamation of Deposit Banks Act.

www.pohjola.fi


[HUG#1943663]

Viðhengi:

Pohjola Bank s interim report for 1 January-30 June 2015.pdf