2007-08-09 07:00:00 CEST
2007-08-09 07:00:00 CEST
REGULATED INFORMATION
OKO Pankki Oyj - Quarterly report
OKO BANK PLC INTERIM REPORT 1 APRIL-30 JUNE 2007 WITH PRESIDENT AND CEO'S COMMENTS
President and CEO's comments:
"In the second quarter, consolidated earnings before tax stood at EUR 100
million. This was a good result, a considerable improvement on the first quarter
and the second quarter last year. Consolidated earnings in the second quarter
included EUR 13 million more in non-recurring capital gains year-on-year.
In Banking and Investment Services, performance and growth remained strong. The
loan and guarantee portfolio grew by 6% in the second quarter. In the last 12
months, the growth was 15%. The risk exposure remained favourable in the first
half of the year.
The balance on technical account in Non-life Insurance was higher than the
corresponding period last year. Growth in insurance premium revenue and the
number of new customers continued to be brisk, boosted by cooperation with OP
Bank Group member cooperative banks.
I am confident that the Group will achieve the target of a 10% earnings
improvement set for 2007."
Helsinki, 9 August 2007
Mikael Silvennoinen
OKO BANK PLC INTERIM REPORT 1 APRIL-30 JUNE 2007
April-June 2007
- Earnings before tax stood at EUR 100 million (57). 1)
- Earnings per share at the end of the year stood at EUR 0.36 (0.21), while
equity per share was EUR 8.91 (8.65). 1)
- The return on equity was 12.2 per cent (2.1).
- The Group's like-for-like net income increased by 25% and like-for-like
expenses by 9%.
- Insurance premium revenue increased by 9% compared with the same period in
2006. The net number of Pohjola's loyal customers increased by 8,400 in
April-June.
- The loan and guarantee portfolio of Banking and Investment Services increased
by 6%, and during the last 12 months by 15%.
- In Non-life Insurance, the combined ratio was 92.3% (94.4). The combined ratio
excluding amortisation on intangible assets arising from the corporate
acquisition was 89.3.% (91.6%).
- The Arbitral Tribunal's decision of 2 May 2007 to increase the redemption
price payable to Pohjola Group plc's minority shareholders by EUR 1.00 to EUR
14.35 per share was recognised in the second quarter. The decision had no
material effect on earnings.
January-June 2007
- Earnings before tax stood at EUR 165 million (126). 1)
- Earnings per share at the end of the year stood at EUR 0.61 (0.47), while
equity per share was EUR 12.8 (5.2).
- The Group's like-for-like net income increased by 17% and like-for-like
expenses by 4%.
- Insurance premium revenue increased by 9% compared with the same period in
2006. The net number of Pohjola's loyal customers increased by 17,300 in
January-June.
- The non-life insurance combined ratio was 97.9% (98.2), while the operating
combined ratio was 94.9% (94.8).
The figures in this release are unaudited.
1) Year 2006 figures for the corresponding periods are used as comparative
figures. Unless otherwise specified, figures at the end of March 2007 are used
when comparing balance sheet and other cross-sectional items.
--------------------------------------------------------------------------------
| Key figures | Q2/ | Q2/ | H1/ | H1/ | |
| | 2007 | 2006 | 200 | 2006 | 2006 |
| | | | 7 | | 30 Dec |
--------------------------------------------------------------------------------
| Earnings before tax, EUR | 100 | 57 | 165 | 126 | 223 |
| million | | | | | |
--------------------------------------------------------------------------------
| Profit for the period, EUR | 73 | 42 | 123 | 95 | 180 |
| million | | | | | |
--------------------------------------------------------------------------------
| Return on equity, % | 12.2 | 2.1 | 12.8 | 5.2 | 9.5 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Balance sheet total, EUR | | | 25.1 | 24.0 | 24.2 |
| billion | | | | | |
--------------------------------------------------------------------------------
| Risk-weighted items, EUR | | | 12.5 | 11.8 | 11.6 |
| billion | | | | | |
--------------------------------------------------------------------------------
| Loan portfolio, EUR billion | | | 8.8 | 7.5 | 7.9 |
--------------------------------------------------------------------------------
| Assets under management, | | | 32.5 | 28.5 | 31.3 |
| EUR billion | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Capital adequacy, % | | | 13.3 | 10.5 | 12.9 |
--------------------------------------------------------------------------------
| Tier 1 ratio, % | | | 8.0 | 8.2 | 8.2 |
--------------------------------------------------------------------------------
| Proportion of | | | 0.2 | 0.2 | 0.2 |
| non-performing receivables | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Earnings per share, EUR | 0.36 | 0.21 | 0.61 | 0.47 | 0.89 |
--------------------------------------------------------------------------------
| Earnings per share | 0.27 | 0.05 | 0.57 | 0.23 | 0.89 |
| including change in fair | | | | | |
| value reserve | | | | | |
--------------------------------------------------------------------------------
| Earnings per share, | 0.36 | 0.21 | 0.61 | 0.47 | 0.89 |
| diluted, EUR | | | | | |
--------------------------------------------------------------------------------
| Equity per share, EUR | | | 8.91 | 8.37 | 8.99 |
--------------------------------------------------------------------------------
| Market capitalisation (A + | | | 2 800 | 2 320 | 2 583 |
| K) | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Average personnel | 2 998 | 3 104 | 2 969 | 3 094 | 3 030 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings by quarter | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 2006 | 2007 |
--------------------------------------------------------------------------------
| EUR million | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | 26 | 25 | 22 | 23 | 26 | 32 |
--------------------------------------------------------------------------------
| Impairment losses on | -1 | 0 | 2 | 0 | 0 | 1 |
| receivables | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | 27 | 25 | 20 | 23 | 26 | 31 |
| after impairment | | | | | | |
| losses | | | | | | |
--------------------------------------------------------------------------------
| Net income from | 86 | 90 | 68 | 84 | 94 | 113 |
| non-life insurance | | | | | | |
--------------------------------------------------------------------------------
| Net commissions and | 26 | 23 | 25 | 29 | 28 | 31 |
| fees | | | | | | |
--------------------------------------------------------------------------------
| Net trading income | 3 | 2 | 6 | 9 | 7 | 3 |
--------------------------------------------------------------------------------
| Net investment income | 20 | 9 | 2 | 7 | 10 | 13 |
--------------------------------------------------------------------------------
| Other operating | 12 | 13 | 11 | 13 | 13 | 24 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Total net income | 173 | 163 | 131 | 165 | 179 | 214 |
--------------------------------------------------------------------------------
| Personnel costs | 42 | 45 | 36 | 42 | 41 | 45 |
--------------------------------------------------------------------------------
| IT expenses | 11 | 11 | 10 | 10 | 11 | 11 |
--------------------------------------------------------------------------------
| Amortisation and | 15 | 14 | 14 | 15 | 15 | 16 |
| depreciation | | | | | | |
--------------------------------------------------------------------------------
| Other expenses | 37 | 35 | 32 | 41 | 47 | 43 |
--------------------------------------------------------------------------------
| Total expenses | 104 | 105 | 92 | 108 | 114 | 114 |
--------------------------------------------------------------------------------
| Share of associates' | 0 | 0 | 0 | 0 | 0 | 0 |
| profits/losses | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 69 | 57 | 40 | 57 | 65 | 100 |
--------------------------------------------------------------------------------
| Income tax | 16 | 15 | -4 | 15 | 15 | 27 |
--------------------------------------------------------------------------------
| Profit for the period | 53 | 42 | 44 | 41 | 50 | 73 |
--------------------------------------------------------------------------------
| Change in fair value | -15 | -33 | 36 | 12 | 11 | -18 |
| reserve | | | | | | |
--------------------------------------------------------------------------------
| Earnings for the | 38 | 9 | 80 | 53 | 61 | 54 |
| period at fair value | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Return on equity, % | 8.5 | 2.1 | 18.3 | 11.7 | 13.7 | 12.2 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Tier 1 ratio, % | 8.8 | 8.2 | 8.2 | 8.2 | 8.0 | 8.0 |
--------------------------------------------------------------------------------
CONSOLIDATED EARNINGS
April-June
OKO Bank Group's earnings before tax increased by 74% to EUR 100 million (57).
Earnings before tax at fair value rose to EUR 75 million (12). Consolidated net
earnings increased by 32% to EUR 214 million (163), while expenses rose by 9% to
EUR 114 million (105). This figure includes capital gains worth EUR 11 million
(4) as one-off items for the sale of OMX shares, and the EUR 6 million in
capital gains for the sale of the marine hull insurance portfolio and EUR 1
million as interest expenses related to the redemption of Pohjola shares held by
minority shareholders.
The capital adequacy ratio at the end of the review period was 13.3% (12.7) and
the Tier 1 ratio was 8.0% (8.0).
Earnings per share at the end of the year stood at EUR 0.36 (0.21), while equity
per share was EUR 8.91 (8.65).
Annualised return on equity stood at 12.2% (2.1).
January-June
OKO Bank Group's earnings before tax amounted to EUR 165 million (126) in the
first half of 2007. These figures included non-recurring capital gains worth EUR
3 million more than last year for the same period. Earnings were impaired by the
liquidated damages of EUR 10 million related to the termination of partnership
between Pohjola Group plc and savings banks. Consolidated net earnings increased
by 17% to EUR 393 million (336), while expenses rose by 9% to EUR 228 million
(209).
Earnings per share were EUR 0.61 (0.47).
Annualised return on equity stood at 12.8% (5.2).
EARNINGS BY BUSINESS LINE
--------------------------------------------------------------------------------
| Earnings before tax, EUR | Q2/2007 | Q2/2006 | H1/2007 | H1/2006 |
| million | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Banking and Investment Services | 52 | 37 | 97 | 84 |
--------------------------------------------------------------------------------
| Non-life insurance operations | 52 | 24 | 83 | 47 |
--------------------------------------------------------------------------------
| Other Operations | -5 | -4 | -15 | -5 |
--------------------------------------------------------------------------------
| Group total | 100 | 57 | 165 | 126 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
April-June
In Banking and Investment Services, earnings before tax stood at EUR 52 million
(37). The figure included capital gains of EUR 11 million recognised on the sale
of OMX shares (4). The loan portfolio of Corporate Banking increased by 5% and
stood at EUR 8.7 billion at the end of June. The risk exposure remained good.
The average level of margins remained stable and was 0.79% at the end of the
period.
Non-life Insurance showed earnings before tax of EUR 52 million (EUR 24). The
figure included EUR 6 million in capital gains on the sale of the marine hull
insurance portfolio. Insurance premium revenue grew by 9% to EUR 219 million
(200). The second-quarter balance on technical account was better than a year
ago. Investment income entered in the income statement increased to EUR 41
million (28). Investment income at fair value totalled EUR 23 million (loss of
EUR 10 million).
Other Operations made a pre-tax loss of EUR 5 million (4 loss). Earnings before
tax from Other Operations included EUR 1 million as interest expenses related to
the redemption of Pohjola shares held by minority shareholders.
January-June
In Banking and Investment Services, earnings before tax stood at EUR 97 million
(84). The figure included capital gains of EUR 11 million recognised on the sale
of OMX shares (12). The loan portfolio of Corporate Banking increased by 11%
from the year-end and by 18% from the end of last June.
In Non-life Insurance, earnings before tax stood at EUR 83 million (47). This
figure included capital gains worth EUR 6 million from the sale of the marine
hull insurance portfolio. Insurance premium revenue grew by 9% to EUR 423
million (388). Investment income entered in the income statement increased to
EUR 88 million (64). Investment income at fair value totalled EUR 87 million
(22).
Other Operations made a pre-tax loss of EUR 15 million (5 loss). Earnings before
tax from Other Operations included EUR 10 million in liquidated damages ruled by
the Arbitral Tribunal on 2 April 2007 related to the partnership agreement with
savings banks, and EUR 1 million in interest expenses related to the redemption
of Pohjola shares held by minority shareholders. Earnings for the same period a
year ago included a capital gain of EUR 2 million recognised on the sale of
Eurocard shares.
INTEGRATION
The integration process of OKO Bank's and Pohjola's business operations proceeds
according to plan. The results so far support earlier estimates of income and
cost synergies, the annual amount of which is estimated to increase to a good
EUR 50 million before tax by 2010.
Decisions made thus far result in annual savings of approximately EUR 29
million, of which decisions worth EUR 1 million were taken in the second quarter
of 2007. New cost savings are mainly gained from ICT functions in Non-life
Insurance. Of the annual cost savings of EUR 29 million, EUR 13 million were
gained in 2006. The cost savings for 2007 are estimated to total EUR 27 million
and the cost savings as of year 2008 EUR 29 million.
In Non-life Insurance, the number of loyal customers increased by 8,400
households, over 90% of which was gained through cooperation within OP Bank
Group. At the end of June, the number of loyal customers was over 384,000, while
the target by the end of 2010 is 500,000. The average annual premiums written
per loyal customer household are over EUR 600. Thanks to the long-term
partnership agreement between OP Bank Group and Kesko, Pohjola joined Kesko's
Plussa loyal customer programme.
Integration costs recognised for the period totalled approximately EUR 1
million. In the period from September 2005 to June 2007, the integration
expenses pertaining to the acquisition of Pohjola totalled around EUR 22
million.
GROUP RESTRUCTURING
The Arbitral Tribunal appointed by the Central Chamber of Commerce decided on 2
May 2007 to set the redemption price of the shares in Pohjola Group plc at EUR
14.35 per share. The Tribunal confirmed the annual interest payable on the
redemption price from 13 June to 30 June 2006 at 5.5% and from 1 July 2006 at
6.0%. The per-share redemption price set by the Tribunal is EUR 1.00 higher than
the EUR 13.35 bid by OKO Bank.
On 29 June 2006, OKO Bank paid the former minority shareholders of Pohjola Group
plc entitled to redemption (15,215,137 shares) EUR 13,35 per share in redemption
price and, on this amount, an interest of 2.50% as of 13 June 2006.
The remainder of the redemption price (EUR 1.00) and interest will be paid to
those entitled to it no later than within a month from the effective date of the
arbitral award. OKO Bank agreed at the end of June 2007 with the key minority
shareholders that the award will remain final between the parties involved and
that the parties will not appeal it. This agreement applies to some 66% of all
of the disputed Pohjola shares held by minority shareholders. Some other
minority shareholders and the special representative have appealed the arbitral
award. For this reason, OKO Bank decided to appeal the arbitral award, in
respect of matters other than agreed, and demand that the district court confirm
the per-share redemption price at EUR 13.35. Owing to the appeal, OKO Bank will
pay the amounts of the arbitral award, plus interest, only to minority
shareholders who will notify OKO Bank of accepting the arbitral award. OKO Bank
notified the minority shareholders of this in writing in July 2007.
The arbitral award will have no material impact on consolidated earnings. The
redemption price was entered as an additional share acquisition cost in the
second quarter.
On 19 April 2007, OKO savings banks which had a majority shareholding in Nooa
Savings Bank Ltd acquired the shareholding of OKO Bank in Nooa Savings Bank for
EUR 6.3 million. OKO Bank had a 25% shareholding in Nooa Savings Bank. OKO Bank
obtained possession of Nooa Savings Bank shares at the end of 2006 once the
earlier holder of the shares, Pohjola Group plc, merged with OKO Bank. In
accordance with the Articles of Association of Nooa Savings Bank, the other
shareholders of the company, in that connection, became entitled to redeem the
shares transferred to OKO Bank. The redemption did not have any impact on OKO
Bank Group's earnings.
Pohjola Non-Life Insurance Company Ltd (Pohjola), a subsidiary of OKO Bank plc,
sold its marine hull insurance portfolio to Codan Forsikring A/S. An agreement
was signed on the deal on 21 March 2007 and the transaction was carried out in
the second quarter. The sale resulted in capital gains of EUR 6 million.
Premiums written for Pohjola's marine hull insurance totalled EUR 18 million in
2006.
PERSONNEL
At the end of June, the Group employed 2,995 people, up by 27 from the end of
March. A total of 736 employees (734) worked for Banking and Investment Services
and a total of 2 205 employees (2 182) for Non-life Insurance. The Group
Administration employed a total of 54 people (52).
CAPITAL EXPENDITURE
Gross investments totalled EUR 5 million in the second quarter, EUR 1 million
allocated to Banking and Investment Services, EUR 3 million to Non-life
Insurance and EUR 1 million to Group Administration. Investments were made in IT
systems to develop network services and streamline internal processes.
CAPITAL ADEQUACY
The capital adequacy ratio as per the Act on Credit Institutions was 13.3%
(12.7), whereas the statutory minimum requirement is 8%. The Tier 1 ratio of OKO
Bank's own funds on risk-weighted items was 8.0% (8.0). The risk-weighted items
increased from EUR 12,239 million to EUR 12,465 million, i.e. 2% mainly as a
result of growth in the loan portfolio.
Own funds grew from EUR 1,550 million to EUR 1,663 million mainly owing to an
increase in earnings and an issue included in upper Tier 2 own funds. Tier 1 own
funds totalled EUR 999 million (975). Capital loans accounted for EUR 224
million of Tier 1 own funds, i.e. 22.4% (22.9). The requirement of own funds
related to the coverage of market risks was EUR 103 million (104).
A new set of capital adequacy requirements entered into force in the EU at the
beginning of 2007. The amended Act on Credit Institutions was approved on 9
February 2007 and entered into force on 15 February 2007. OKO Bank will make use
of the new calculation methods made available by the transitional provisions in
the capital adequacy reform. OKO Bank's capital adequacy for 2007 will be
calculated under the existing requirements, i.e. the same way as in 2006. In the
calculation of capital adequacy requirements for credit risk, OKO aims to phase
in the internal ratings-based approach (IRBA), with the first items such as
corporate responsibility and capital adequacy requirements calculated using IRBA
in 2008. The capital adequacy requirement of operational risks will be
calculated using the basic method from 2008 onwards.
RISK EXPOSURE
Banking and Investment Services
In Banking and Investment Services, the risk exposure remained good. Total
exposure fell during the second quarter by EUR 1.2 billion to EUR 26.8 billion.
The decline was mainly caused by repayment of credit granted to OP Mortgage
Bank. Total liability rose by EUR 0.5 billion from the beginning of the year.
The relative share of investment-grade exposure - that is, ratings 1 to 4,
excluding private customers - in total exposures remained stable at 73% (75),
the share of ratings 11 to 12 was 0.2% (0.3) and that of non-rated exposure 3%
(3). Of the corporate exposure, the share of investment-grade corporate exposure
rose to 52% (51). The corporate exposure of the two lowest rating classes was
EUR 58 million (64), i.e. 0.6% of the corporate exposure.
The amount of significant customer exposure remained stable at EUR 3.1 billion
(3.0). The proportion of non-performing receivables of the loan and guarantee
portfolio remained very low, at EUR 16 million (23), or 0.2% (0.2). The effect
on the result by loan and guarantee losses and impairment losses was EUR 0.5
million during the first half of the year. Market risks were kept at a moderate
level despite growth in the volume of derivatives trading. The amount of
liquidity reserves totalled EUR 5.2 billion (5.3) at the end of June. The
average maturity of funding has extended, because certificate-of-deposit funding
with a term less than 12 months reduced by EUR 1.8 billion. The effect of
operational risks reducing earnings was EUR 0.6 million in the first half.
The immediate risks related to American sub-prime housing loans are very small.
Non-life insurance operations
The capital adequacy of Non-life Insurance amounted to EUR 666 million (623) at
the end of June. The ratio of solvency capital to insurance premium revenue
(solvency ratio) was 81% (77).
In Non-life Insurance, there were 53 (44) major or medium-sized losses (losses
in excess of EUR 0.1 million), with the claims incurred of these losses retained
for own account totalling EUR 17 million (19). During the first half, there were
106 (85) major or medium-sized losses, with the claims incurred of these losses
retained for own account totalling EUR 33 million (31).
Of the investment portfolio, bonds and bond funds accounted for 67% (72) and
equities for 17% (18). The duration of the fixed-income portfolio shortened
during the first half from 4.8 to 3.6 years. Investment income at fair value
stood at 1.0% in April-June and 3.5 % in January-June.
The immediate risks related to American sub-prime housing loans are very small.
Credit ratings
OKO Bank's credit ratings are as follows:
--------------------------------------------------------------------------------
| Rating agency | Short-term debt | Long-term debt |
--------------------------------------------------------------------------------
| Standard & Poor's | A-1+ | AA- |
--------------------------------------------------------------------------------
| Moody's | P-1 | Aa1 |
--------------------------------------------------------------------------------
| Fitch | F1+ | AA- |
--------------------------------------------------------------------------------
In April, Moody's revised OKO Bank's Long-Term Issuer Rating to Aa1 (Aa2 on 31
December 2006). Outlook has been confirmed stable by all rating agencies.
SHARE CAPITAL AND SHAREHOLDERS
At the end of June, a total of 159.4 million Series A shares were quoted on the
Helsinki Stock Exchange. Series A shares represented 78.4% of all shares and
42.1% of votes. The number of Series K shares totalled around 44 million.
At the end of the review period, the Series A share price was EUR 13.77 while
the share-issue adjusted price was EUR 11.50 a year earlier. In April-June, the
share price reached a high of EUR 15.28 and a low of EUR 12.62. Around 37,7
million shares changed owners during the second quarter. In the first quarter of
2006, the corresponding number was 24.2 million.
At the end of June, OKO Bank had some 31,000 shareholders, down by 1,000 during
the second quarter. Around 95% of the shareholders were private individuals. No
significant changes occurred in the holdings of the major shareholders. The
largest shareholder was the OP Bank Group Central Cooperative, which held 30% of
OKO Bank shares and 56.9% of the votes. The number of nominee registered shares
in proportion to all Series A shares increased in the second quarter from 18.7%
to 20.4%.
EVENTS AFTER THE REPORTING PERIOD
A total of 112,860 Series K shares were converted into Series K shares in July.
The conversions were entered in the Trade Register on 13 July 2007. The
conversions did not affect the total number of shares outstanding or the amount
of equity capital.
OUTLOOK TOWARDS THE YEAR-END
Growth in the corporate loan market is expected to continue but at a slower rate
than in the first half. Lending margins are not expected to decrease
significantly.
The corporate loan portfolio of OKO Bank's Banking and Investment Services is
forecast to grow faster than the market average. The risk exposure should remain
good and impairment losses on receivables at a lower level than normally. OKO
Bank's commission income is expected to increase further especially as a result
of high demand for asset management services and structured product and service
packages.
Provided that the operating environment remains as expected, 2007 earnings
before tax from Banking and Investment Services are anticipated to be better
than in 2006.
In addition to market growth, intense cooperation with OP Bank Group member
cooperative banks, which is expected to improve the market share in the
household customer base in particular, will boost insurance premium revenue in
Non-life Insurance. Growth in the Group's insurance premium revenue is expected
to exceed GDP growth this year, despite the sale of the marine hull insurance
portfolio.
The unfavourable trend in major losses in the latter half of 2006 is expected to
normalise. In Non-life Insurance, the combined ratio excluding changes in
reserving bases and the amortisation on intangible assets arising from the
acquisition is estimated to be less than 94.0% if the trend in major losses is
similar to that in the first half of the year. The long-term return expectation
for the investment portfolio in Non-life Insurance is 5.2%.
Earnings from Other Operations, excluding the liquidated damages of EUR 10
million ruled by the Arbitral Tribunal, are expected to be on a par with
earnings in 2006.
OKO Bank is anticipated to have every prospect of improving earnings before tax
at fair value by at least 10% in 2007, provided that no radical changes take
place in equity and bond markets.
The main risks related to the materialisation of the near-future outlook stated
above concern the general operating environment and the development of interest
rates and share prices. The management of the Group has no influence on the
general operating environment. However, the management may influence the effects
of interest rate changes and the equity market on investments and trading by
investing assets securely, by diversifying risks, by ensuring the professional
skills of its personnel, and by effective risk management. In addition, the
management may influence the appropriate pricing of customer-specific risk and
consequently the financial performance of the Group.
All the estimates presented in this report are based on the current
understanding of the financial development of the Group and its different
operations; actual performance may vary significantly.
BUSINESS OPERATIONS
The table below presents the actual earnings of the Group and its business lines
before tax, as well as the strategic targets and their actuals. The calculation
of key ratios is presented on pages 18-20.
--------------------------------------------------------------------------------
| | Q2/20 | Q2/20 | H1/200 | H1/2006 | 2006 | Target |
| | 07 | 06 | 7 | | | 2009 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Banking and Investment | | | | | | |
| Services | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax, | 52 | 37 | 97 | 84 | 163 | |
| EUR million | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | 17.7 | 14.0 | 17.7 | 16.4 | 18.2 | > 18 |
| equity (ROE), % | | | | | | |
--------------------------------------------------------------------------------
| Operating cost/income | 38.2 | 43.1 | 38.6 | 40.3 | 41.5 | 40.0 |
| ratio, % | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Non-life insurance | | | | | | |
| operations | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax, | 52 | 24 | 83 | 47 | 78 | |
| EUR million | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | 26.9 | -14.4 | 30.7 | 4.5 | 20.9 | > 20 |
| equity (ROE), % | | | | | | |
--------------------------------------------------------------------------------
| Operating combined | 89.3 | 91.6 | 94.9 | 94.8 | 95.4 | < 94 |
| ratio, % | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other Operations | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax, | -5 | -4 | -15 | -5 | -19 | |
| EUR million | | | | | | |
--------------------------------------------------------------------------------
BANKING AND INVESTMENT SERVICES
Banking and Investment Services comprises the following divisions:
- Corporate Banking
- Markets
- Group Treasury
- Asset Management
--------------------------------------------------------------------------------
| | 2006 | | | | 2007 | |
--------------------------------------------------------------------------------
| | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 |
--------------------------------------------------------------------------------
| Income statement, EUR | | | | | | |
| million | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | 30 | 28 | 27 | 29 | 29 | 34 |
--------------------------------------------------------------------------------
| Impairment losses on | -1 | 0 | 2 | 0 | 0 | 1 |
| receivables | | | | | | |
--------------------------------------------------------------------------------
| Net interest income after | 30 | 28 | 25 | 28 | 29 | 34 |
| impairment losses | | | | | | |
--------------------------------------------------------------------------------
| Net commissions and fees | 23 | 22 | 26 | 29 | 26 | 30 |
--------------------------------------------------------------------------------
| Net trading income | 3 | 2 | 6 | 9 | 7 | 2 |
--------------------------------------------------------------------------------
| Net investment income | 14 | 8 | 2 | 6 | 5 | 13 |
--------------------------------------------------------------------------------
| Other operating income | 7 | 7 | 4 | 7 | 7 | 7 |
--------------------------------------------------------------------------------
| Total net income | 76 | 67 | 62 | 79 | 74 | 86 |
--------------------------------------------------------------------------------
| Total expenses | 29 | 29 | 27 | 36 | 30 | 33 |
--------------------------------------------------------------------------------
| Amortisation on | 1 | 1 | 1 | 1 | 1 | 1 |
| intangible assets from | | | | | | |
| acquisition | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 47 | 37 | 35 | 43 | 45 | 52 |
--------------------------------------------------------------------------------
| Change in fair value | -4 | -7 | 2 | 2 | -2 | -8 |
| reserve | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax at | 43 | 30 | 37 | 45 | 43 | 45 |
| fair value | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Key ratios, % | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | 18.9 | 14.0 | 16.1 | 19.2 | 17.6 | 17.7 |
| equity (ROE) p.a. | | | | | | |
--------------------------------------------------------------------------------
| Operating cost/income | 37.9 | 43.1 | 40.9 | 44.0 | 39.1 | 38.2 |
| ratio | | | | | | |
--------------------------------------------------------------------------------
| Proportion of | 0.3 | 0.2 | 0.2 | 0.2 | 0.2 | 0.2 |
| non-performing | | | | | | |
| receivables to | | | | | | |
| receivables from | | | | | | |
| customers and guarantees, | | | | | | |
| % | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| | 31.3 | 30.6 | 30.9 | 31.12 | 31.3 | 30.6 |
--------------------------------------------------------------------------------
| Information on volumes, | | | | | | |
| EUR billion | | | | | | |
--------------------------------------------------------------------------------
| Receivables from | 7.1 | 7.4 | 7.7 | 7.9 | 8.3 | 8.7 |
| customers | | | | | | |
--------------------------------------------------------------------------------
| Unused standby credit | 2.7 | 3.1 | 3.1 | 3.6 | 3.4 | 3.1 |
| facilities | | | | | | |
--------------------------------------------------------------------------------
| Guarantees | 1.5 | 1.9 | 1.9 | 1.9 | 1.8 | 2.0 |
--------------------------------------------------------------------------------
| Assets under management | 28.9 | 28.5 | 29.7 | 31.3 | 31.3 | 32.5 |
--------------------------------------------------------------------------------
| Notes and bonds | 4.9 | 4.1 | 5.2 | 4.9 | 5.5 | 3.7 |
--------------------------------------------------------------------------------
| Receivables from member | 4.1 | 4.1 | 4.6 | 4.7 | 3.9 | 4.0 |
| cooperative banks | | | | | | |
--------------------------------------------------------------------------------
| Liabilities to member | 1.4 | 1.4 | 1.4 | 1.3 | 1.3 | 1.4 |
| cooperative banks | | | | | | |
--------------------------------------------------------------------------------
| Risk-weighted items | 9.9 | 10.7 | 11.1 | 11.1 | 11.8 | 12.0 |
--------------------------------------------------------------------------------
| Debt securities issued to | 11.7 | 12.2 | 12.9 | 13.9 | 15.1 | 13.5 |
| the public | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Average personnel | 730 | 737 | 747 | 718 | 734 | 736 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Average margins, % | | | | | | |
--------------------------------------------------------------------------------
| Margin on corporate loan | 0.88 | 0.79 | 0.89 | 0.87 | 0.81 | 0.79 |
| stock | | | | | | |
--------------------------------------------------------------------------------
| Margin on institutional | 0.27 | 0.26 | 0.25 | 0.24 | 0.24 | 0.24 |
| loan stock | | | | | | |
--------------------------------------------------------------------------------
| Margin on member | 0.15 | 0.15 | 0.14 | 0.12 | 0.12 | 0.12 |
| cooperative banks' loan | | | | | | |
| stock | | | | | | |
--------------------------------------------------------------------------------
| Margin on member | 0.21 | 0.13 | 0.13 | 0.11 | 0.11 | 0.13 |
| cooperative banks' | | | | | | |
| deposits | | | | | | |
--------------------------------------------------------------------------------
Earnings
In Banking and Investment Services, earnings before tax stood at EUR 52 million
(37).
Net interest income before impairment losses was EUR 34 million (28).
Impairment losses on receivables burdened earnings by a net sum of EUR 0.5
million (0).
Net commission income increased to EUR 30 million (22).
Net trading income was EUR 2 million (2).
Net investment income amounted to EUR 13 million (8). The income included
capital gains of EUR 11 million recognised on the sale of OMX shares (4).
Operating return on equity was 17.7% (14.0) and the cost/income ratio was 38.2%
(43.1).
Corporate Banking
OKO Bank's market position in Corporate Banking strengthened further.
In Corporate Banking, the aggregate amount of loans and guarantees increased in
the second quarter by 6% to EUR 10.7 billion. The annual growth was 16%. The
loan portfolio of Corporate Banking increased by 5% in April-June and stood at
EUR 8.7 billion. The annual growth was EUR 1.3 billion or 18%. At the end of
June, OKO Bank's market share in corporate loans went up to 17.8%, which
represented growth of 0.6 percentage point from the year end.
In Corporate Banking, net interest income increased by 28% to EUR 26 million
(20).
The margin level in the corporate loan portfolio remained stable and was 0.79%
at the end of the second quarter. The margins of institutional loans remained
unchanged in the second quarter.
Despite long-lasting and brisk growth in the loan portfolio, the risk exposure
is still considered to be good. Net impairment losses totalled EUR 0.5 million
(0).
In Corporate Banking, earnings before tax improved to EUR 23 million (19).
Markets
In Markets, earnings before tax increased to EUR 9 million (4), which is mainly
explained by larger volumes of customer trading and structured products and
growth in the arrangement of debt issues to customers.
In April-June, OKO Bank acted as the mandated lead arranger in three corporate
bond issues, worth a total of EUR 450 million. In May, OP Bank also acted as the
mandated lead arranger in a Finnish government bond issue worth four billion
euros. In June, OKO Bank was the mandated lead arranger in a covered bond issued
by OP Mortgage Bank, worth over one billion euros.
OKO Bank was the mandated lead arranger in the initial public offering of Suomen
Terveystalo Oyj in April and that of SRV Yhtiöt Oyj in June.
Central Banking
In February, OP Mortgage Bank acquired a mortgage loan portfolio of EUR 1.3
billion from OP Bank Group member cooperative banks, which used the proceeds
from the sale to pay back loans totalling around EUR 1.1 billion to OKO Bank. OP
Mortgage Bank financed the acquisition of the loan portfolio by taking out a
temporary loan from OKO Bank, which it paid back in June. OP Mortgage Bank
financed the loan portfolio purchases mainly directly from the capital markets
with a covered bond issue in June as OKO acted as one of the mandated lead
arrangers. At the end of June, OKO Bank's net receivables from OP Bank Group
member cooperative banks totalled EUR 2.6 billion, which was EUR 0.8 billion
less than at the end of 2006.
In Central Banking, earnings before tax were at the same level as in the
previous year, EUR 4 million (4).
Group Treasury
In June, OKO Bank prematurely called in a debenture loan classified as upper
Tier 2 own funds (EUR 50 million) and issued a new debenture loan worth GBP 100
million, also classified as upper Tier 2 capital (approx. EUR 148 million).
Group Treasury earnings before tax rose to EUR 12 million (7), of which net
investment income totalled EUR 13 million (7.5). Earnings included a capital
gain of EUR 11 million recognised on the sale of OMX Group shares (4).
Asset Management
In Asset Management, assets under management increased by EUR 1.2 billion in
April-June and stood at EUR 32.5 billion (31,3) on 30 June. Growth in customer
assets in the review period came from net sales and an increase in market value.
Of the amount, institutional customers accounted for EUR 16.6 billion (16.8), OP
mutual funds for EUR 14.2 billion (13.1) and OKO Private for EUR 1.0 billion
(0.7).
In Asset Management, earnings rose to EUR 5 million (3) as a result of increased
management fees and materialised cost synergies.
January-June
In Banking and Investment Services, earnings before tax stood at EUR 97 million
(84).
Net interest income before impairment losses was EUR 64 million (58).
Impairment losses on receivables burdened earnings by a net amount of EUR 0.5
million (decrease in impairment loss provisions of EUR 0.8 million) In
January-June, the loan portfolio of Corporate Banking increased by 11% and stood
at EUR 8.7 billion.
Net commission income increased to EUR 56 million (45). Commission income was
evenly distributed between Corporate Banking, Capital Markets and Asset
Management.
Net trading income was EUR 9 million (5). Income increased as a result of growth
in earnings related to notes and bonds in the first quarter.
Net investment income amounted to EUR 18 million (21). The figure included
capital gains of EUR 11 million recognised on the sale of OMX shares (12).
Operating return on equity was 17.7% (16.4) and the cost/income ratio was 38.6%
(40.3).
NON-LIFE INSURANCE OPERATIONS
Non-life Insurance includes the following divisions:
- Corporate Customers
- Private Customers
- Baltic States
--------------------------------------------------------------------------------
| | 2006 | | | | 2007 | |
--------------------------------------------------------------------------------
| | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 |
--------------------------------------------------------------------------------
| Income statement, EUR | | | | | | |
| million | | | | | | |
--------------------------------------------------------------------------------
| Insurance premium | 187 | 200 | 196 | 204 | 204 | 219 |
| revenue | | | | | | |
--------------------------------------------------------------------------------
| Claims incurred | 129 | 129 | 141 | 137 | 147 | 136 |
--------------------------------------------------------------------------------
| Loss adjustment | 10 | 11 | 10 | 12 | 12 | 12 |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| Operating expenses | 45 | 43 | 39 | 45 | 47 | 48 |
--------------------------------------------------------------------------------
| Amortisation/adjustment | 7 | 6 | 6 | 6 | 6 | 7 |
| of intangible assets | | | | | | |
| related to acquisition | | | | | | |
--------------------------------------------------------------------------------
| Balance on technical | -4 | 11 | 0 | 3 | -8 | 17 |
| account | | | | | | |
--------------------------------------------------------------------------------
| Net investment income | 36 | 28 | 23 | 28 | 48 | 41 |
--------------------------------------------------------------------------------
| Other income and | 1 | -4 | 1 | 0 | 3 | 7 |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| Operating profit | 33 | 35 | 24 | 32 | 42 | 64 |
--------------------------------------------------------------------------------
| Unwinding of discount | 9 | 9 | 9 | 9 | 10 | 10 |
--------------------------------------------------------------------------------
| Finance costs | 1 | 2 | 3 | 2 | 2 | 2 |
--------------------------------------------------------------------------------
| Earnings before tax | 23 | 24 | 11 | 20 | 31 | 52 |
--------------------------------------------------------------------------------
| Change in fair value | -5 | -38 | 46 | 14 | 16 | -17 |
| reserve | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax at | 18 | -14 | 58 | 34 | 47 | 35 |
| fair value | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Key ratios, % | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | 23.8 | -14.4 | 44.1 | 27.6 | 35.0 | 26.9 |
| equity | | | | | | |
--------------------------------------------------------------------------------
| Loss ratio | 74.3 | 70.0 | 76.8 | 73.1 | 78.0 | 67.5 |
--------------------------------------------------------------------------------
| Operating expense ratio | 23.8 | 21.6 | 19.9 | 22.1 | 22.9 | 21.9 |
--------------------------------------------------------------------------------
| Operating combined | 98.2 | 91.6 | 96.7 | 95.3 | 100.8 | 89.3 |
| ratio | | | | | | |
--------------------------------------------------------------------------------
| Expense ratio | 27.9 | 24.4 | 23.1 | 25.2 | 25.9 | 24.8 |
--------------------------------------------------------------------------------
| Combined ratio | 102.2 | 94.4 | 99.9 | 98.3 | 103.9 | 92.3 |
--------------------------------------------------------------------------------
| Return on investments | 1.5 | -0.5 | 2.5 | 1.5 | 2.4 | 1.0 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| | 31 | 30 Jun | 30 Sep | 31 Dec | 31 Mar | 30 Jun |
| | Mar | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Volume data, EUR | | | | | | |
| billion | | | | | | |
--------------------------------------------------------------------------------
| Insurance contract | | | | | | |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Discounted insurance | 1 184 | 1 194 | 1207 | 1 223 | 1 241 | 1 268 |
| contract liabilities | | | | | | |
--------------------------------------------------------------------------------
| Other insurance | 914 | 857 | 818 | 746 | 954 | 905 |
| contract liabilities | | | | | | |
--------------------------------------------------------------------------------
| Investment portfolio | | | | | | |
--------------------------------------------------------------------------------
| Bonds | 1 790 | 1 825 | 1802 | 1 752 | 1 697 | 1 697 |
--------------------------------------------------------------------------------
| Money market | 379 | 266 | 397 | 22 | 19 | 20 |
| investments | | | | | | |
--------------------------------------------------------------------------------
| Equities | 422 | 392 | 378 | 447 | 489 | 471 |
--------------------------------------------------------------------------------
| Investment property | 60 | 58 | 53 | 56 | 60 | 69 |
--------------------------------------------------------------------------------
| Alternative investments | 65 | 43 | 75 | 87 | 133 | 166 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Average personnel | 2 099 | 2 134 | 2 204 | 2 154 | 2 182 | 2 205 |
--------------------------------------------------------------------------------
April-June
Earnings
Earnings before tax stood at EUR 52 million (24). The figure included capital
gains of EUR 6 million from the sale of the marine hull insurance portfolio. The
operating return on equity was 26.9% (-14.4).
Insurance premium revenue
Insurance premium revenue grew by 9% to EUR 219 million (200).
The growth was strongest in the Private Customers division where insurance
premium revenue increased to EUR 93 million (82) as a result of cooperation
within the OP Bank Group and of upgraded service offerings. In the Corporate
Customers division, premium revenue of comprehensive motor vehicle and motor
liability insurance generated the largest monetary and proportional growth.
Premium revenue generated by the Baltic business increased by 21% to EUR 14
million (11).
Claims incurred and operating expenses
The operating combined ratio was 89.3% (91.6), of which claims incurred
represented 61.2 percentage points (63.6). Operating expenses and loss
adjustment expenses (cost ratio) increased to 28.1 percentage points (28.0).
Claims incurred (excluding loss adjustment expenses) increased to EUR 136
million (129), of which major and medium-sized losses (in excess of EUR 0.1
million) accounted for EUR 17 million (19). The number of major losses of over
EUR 2 million retained for own account was 0 (2). The unfavourable trend in
motor liability and motor vehicle insurance claims continued in the second
quarter. This is explained by the greater incidence of road accidents and
increases in car repair prices markedly above those in the general price level.
The current economic upswing can also be seen in the sharp rise in traveller's
insurance claims.
Operating expenses and loss adjustment expenses grew to EUR 60 million (55).
Operating expenses amounted to EUR 48 million (43) and loss adjustment expenses
to EUR 12 million (11). The higher expenses can be primarily attributed to the
rising costs in insurance sales and loss adjustment.
Investment operations
In Non-life Insurance, the fair value of investments at the end of June was EUR
2.4 billion (2.4). Of the amount, equities accounted for 17% (18) and money
market instruments for 1% (1).
Return on investments at fair value was 1.0%. Net investment income entered
under earnings was EUR 41 million (28). Net investment income at fair value was
EUR 23 million.
The discount rate for the EUR 1.2 billion pension liabilities was 3.3% (3.3).
The unwinding of discount is recognised as a post-balance-on-technical-account
item.
January-June
Earnings before tax stood at EUR 83 million (47).
Insurance premium revenue grew by 9% to EUR 423 million (388). The growth was
strongest in the Private Customers division where insurance premium revenue
increased to EUR 173 million (154) as a result of cooperation within OP Bank
Group and of upgraded service offerings.
The operating combined ratio was 94.9% (94.8), of which claims incurred
represented 66.0 percentage points (65.6). Operating expenses and loss
adjustment expenses (cost ratio) stood at 28.9% (29.1).
Claims incurred (excluding loss adjustment expenses) increased to EUR 283
million (258), of which major and medium-sized losses (in excess of EUR 0.1
million) accounted for EUR 33 million (EUR 31 million in 2006). The number of
major losses of over EUR 2 million retained for own account was 2 (2).
Operating expenses and loss adjustment expenses grew to EUR 119 million (110).
Operating expenses amounted to EUR 95 million (88) and loss adjustment expenses
to EUR 24 million (22). Operating expenses include integration expenses of EUR
0.7 million (1.6)
Return on investments at fair value was 3.5% and net investment income entered
under earnings was EUR 88 million (64). Net investment income at fair value was
EUR 87 million.
The operating return on equity was 30.7% (4.5).
OTHER OPERATIONS
Earnings from Other Operations consist of Group administrative expenses and
funding costs of Pohjola shares.
--------------------------------------------------------------------------------
| | 2006 | 2007 |
--------------------------------------------------------------------------------
| | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 |
--------------------------------------------------------------------------------
| Income statement, EUR | | | | | | |
| million | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | -3 | -1 | -4 | -4 | -3 | -3 |
--------------------------------------------------------------------------------
| Other net income | 19 | 15 | 8 | 6 | 11 | 6 |
--------------------------------------------------------------------------------
| Income | 16 | 13 | 4 | 2 | 8 | 3 |
--------------------------------------------------------------------------------
| Expenses | 17 | 17 | 12 | 8 | 19 | 8 |
--------------------------------------------------------------------------------
| Earnings before tax | -1 | -4 | -7 | -7 | -11 | -5 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
April-June
Other Operations showed a loss of EUR 5 million before tax (a loss of EUR 4
million).
Earnings in the second quarter included EUR 1 million in interest expenses
related to the redemption of Pohjola shares held by minority shareholders.
January-June
Other Operations showed a loss of EUR 15 million before tax (a loss of EUR 5
million).
Earnings in the first quarter were burdened by the liquidated damages ruled by
the Arbitral Tribunal on 2 April 2007 for OKO Bank concerning the shareholder
agreement dispute over Nooa Savings Bank Ltd. The effect of this was EUR 10
million. Earnings for the same period a year ago included a capital gain of EUR
2 million recognised on the sale of Eurocard shares.
FORMULAE FOR KEY RATIOS
Return on equity (ROE) at fair value
Profit for the period + Change in fair value reserve after tax x 100
Shareholders' equity (average of the beginning and end of the period)
Cost/income ratio, %
Personnel costs + Other administrative expenses + Other operating expenses x
100
Net interest income + Net income from Non-life Insurance +
Net commissions and fees + Net trading income + Net investment income +
Other operating income
Earnings/share (EPS)
Profit for the period attributable to parent company owners
Share-issue adjusted average number of shares during the financial period
Earnings/share (EPS), diluted
The denominator is the average share-issue adjusted number of shares during the
financial period plus the number of shares which is obtained if all stock
options are converted into shares.
Subtracted from the figure thus obtained is the number of shares that can be
obtained through the exercise of all stock options multiplied by the share
subscription price and divided by the average share price during the financial
period.
Earnings/share at fair value
Profit for the period attributable to parent company owners + Change in fair
value reserve
Share-issue adjusted average number of shares during the financial period
Equity/share
Shareholders' equity
Share-issue adjusted number of shares on the balance sheet date
Market capitalisation
Number of shares x closing price on the balance sheet date
Capital adequacy, %
Own funds x 100
Risk-weighted items
Tier 1 ratio, %
Tier 1 own funds x 100
Risk-weighted items
KEY RATIOS IN NON-LIFE INSURANCE
The key ratios for Non-life insurance have been calculated in accordance with
Insurance Supervisory Authority regulations using the corresponding IFRS
sections as applicable.
The key figures have been calculated using activity-based expenses applied by
non-life insurance companies, which are not presented on the same principle as
in the consolidated Income statement.
Loss ratio (excl. unwinding of discount)
Claims and loss adjustment expenses x 100
Net insurance premium revenue
Expense ratio
Operating expenses + amortisation/adjustment of intangible assets related to
acquisition x 100
Net insurance premium revenue
Risk ratio (excl. unwinding of discount)
Claims excl. loss adjustment expenses x100
Net insurance premium revenue
Cost ratio
Operating expenses and loss adjustment expenses x100
Insurance premium revenue
Combined ratio (excl. unwinding of discount)
Loss ratio + expense ratio
Risk ratio + cost ratio
OPERATING KEY RATIOS, %
Operating return on equity (ROE), %
Banking and Investment Services:
+ Profit for the period
+ Amortisation and write-downs on intangible assets and goodwill related to
acquisition of Pohjola Asset Management and their tax effect
+ Change in fair value reserve after tax x
100
+ 7%of risk-weighted commitments
+ Shareholders' equity of OKO Asset Management and Pohjola Property Management
- Subordinated loans allocated to business lines
(average of the beginning and end of the financial period)
Non-life Insurance:
+ Profit for the period
+ Amortisation and write-downs on intangible assets and goodwill related to
acquisition of non-life business, and their tax effects
+ Change in fair value reserve after tax x 100
+ 70% solvency ratio
- Subordinated loans allocated to business lines
(average of the beginning and end of the financial period)
or
minimum capital required by the authorities, if this is larger
Operating cost/income ratio
+ Personnel costs
+ Other administrative expenses
+ Other operating expenses excl. amortisation and write-downs on intangible
assets and goodwill related to Pohjola acquisition
x 100
+ Net interest income
+ Net income from Non-life Insurance
+ Net commissions and fees
+ Net trading income
+ Net investment income
+ Other operating income
Operating expense ratio
Operating expenses x100
Net insurance premium revenue
Operating combined ratio
Loss ratio + operating expense ratio
--------------------------------------------------------------------------------
| OKO Bank Group income statement, 1 April-30 June | | |
| 2007 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | Q2/ | Q2/ |
| | | 2007 | 2006 |
--------------------------------------------------------------------------------
| Interest income | | 546 | 297 |
--------------------------------------------------------------------------------
| Interest expenses | | 514 | 272 |
--------------------------------------------------------------------------------
| Net interest income (Note 1) | | 32 | 25 |
--------------------------------------------------------------------------------
| Impairment losses on receivables (Note 2) | | 1 | 0 |
--------------------------------------------------------------------------------
| Net interest income after impairment | | 31 | 25 |
| losses | | | |
--------------------------------------------------------------------------------
| Net income from Non-life insurance (Note | | 113 | 90 |
| 3) | | | |
--------------------------------------------------------------------------------
| Net commissions and fees (Note 4) | | 31 | 23 |
--------------------------------------------------------------------------------
| Net trading income (Note 5) | | 3 | 2 |
--------------------------------------------------------------------------------
| Net investment income (Note 6) | | 13 | 9 |
--------------------------------------------------------------------------------
| Other operating income (Note 7) | | 24 | 13 |
--------------------------------------------------------------------------------
| Total net income | | 214 | 163 |
--------------------------------------------------------------------------------
| Personnel costs (Note 8) | | 45 | 45 |
--------------------------------------------------------------------------------
| Other administrative expenses (Note 9) | | 39 | 34 |
--------------------------------------------------------------------------------
| Other operating expenses (Note 10) | | 31 | 27 |
--------------------------------------------------------------------------------
| Total expenses | | 114 | 105 |
--------------------------------------------------------------------------------
| Earnings before tax | | 100 | 57 |
--------------------------------------------------------------------------------
| Income tax | | 27 | 15 |
--------------------------------------------------------------------------------
| Profit for the period | | 73 | 42 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Basic earnings per share, EUR | | | |
--------------------------------------------------------------------------------
| Series A | | 0.36 | 0.21 |
--------------------------------------------------------------------------------
| Series K | | 0.36 | 0.21 |
--------------------------------------------------------------------------------
| Diluted earnings per share, EUR | | | |
--------------------------------------------------------------------------------
| Series A | | 0.36 | 0.21 |
--------------------------------------------------------------------------------
| Series K | | 0.36 | 0.21 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| OKO Bank Group income statement, 1 January -30 | | |
| June 2007 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | H1/ | H1/ |
| | | 2007 | 2006 |
--------------------------------------------------------------------------------
| Interest income | | 983 | 545 |
--------------------------------------------------------------------------------
| Interest expenses | | 925 | 494 |
--------------------------------------------------------------------------------
| Net interest income (Note 1) | | 58 | 51 |
--------------------------------------------------------------------------------
| Impairment losses on receivables (Note 2) | | 0 | -1 |
--------------------------------------------------------------------------------
| Net interest income after impairment | | 58 | 52 |
| losses | | | |
--------------------------------------------------------------------------------
| Net income from Non-life Insurance(Note 3) | | 208 | 176 |
--------------------------------------------------------------------------------
| Net commissions and fees (Note 4) | | 59 | 48 |
--------------------------------------------------------------------------------
| Net trading income (Note 5) | | 10 | 5 |
--------------------------------------------------------------------------------
| Net investment income (Note 6) | | 23 | 29 |
--------------------------------------------------------------------------------
| Other operating income (Note 7) | | 36 | 25 |
--------------------------------------------------------------------------------
| Total net income | | 393 | 336 |
--------------------------------------------------------------------------------
| Personnel costs (Note 8) | | 86 | 87 |
--------------------------------------------------------------------------------
| Other administrative expenses (Note 9) | | 73 | 66 |
--------------------------------------------------------------------------------
| Other operating expenses (Note 10) | | 69 | 56 |
--------------------------------------------------------------------------------
| Total expenses | | 228 | 209 |
--------------------------------------------------------------------------------
| Earnings before tax | | 165 | 126 |
--------------------------------------------------------------------------------
| Income tax | | 42 | 31 |
--------------------------------------------------------------------------------
| Profit for the period | | 123 | 95 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Basic earnings per share, EUR | | | |
--------------------------------------------------------------------------------
| Series A | | 0.61 | 0.47 |
--------------------------------------------------------------------------------
| Series K | | 0.60 | 0.47 |
--------------------------------------------------------------------------------
| Diluted earnings per share, EUR | | | |
--------------------------------------------------------------------------------
| Series A | | 0.61 | 0.47 |
--------------------------------------------------------------------------------
| Series K | | 0.60 | 0.47 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| OKO Bank Group balance sheet | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | 30 Jun | 30 Dec |
| | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Liquid assets | | 1 719 | 907 |
--------------------------------------------------------------------------------
| Receivables from financial | | 5 127 | 5 546 |
| institutions | | | |
--------------------------------------------------------------------------------
| Financial assets for trading (Note | | 3 567 | 4 801 |
| 11) | | | |
--------------------------------------------------------------------------------
| Derivative contracts | | 566 | 320 |
--------------------------------------------------------------------------------
| Receivables from customers | | 8 687 | 7 864 |
--------------------------------------------------------------------------------
| Non-life Insurance assets (Note | | 2 932 | 2 766 |
| 12) | | | |
--------------------------------------------------------------------------------
| Investment assets (Note 13) | | 194 | 225 |
--------------------------------------------------------------------------------
| Investments in associates | | 2 | 8 |
--------------------------------------------------------------------------------
| Intangible assets (Note 14) | | 1 012 | 1 020 |
--------------------------------------------------------------------------------
| Tangible assets | | 95 | 95 |
--------------------------------------------------------------------------------
| Other assets | | 1 207 | 633 |
--------------------------------------------------------------------------------
| Tax receivables | | 11 | 12 |
--------------------------------------------------------------------------------
| Total assets | | 25 120 | 24 196 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Liabilities to financial | | 1 929 | 2 390 |
| institutions | | | |
--------------------------------------------------------------------------------
| Derivative contracts | | 562 | 331 |
--------------------------------------------------------------------------------
| Liabilities to customers | | 2 229 | 1 994 |
--------------------------------------------------------------------------------
| Non-life Insurance liabilities | | 2 355 | 2 099 |
| (Note 15) | | | |
--------------------------------------------------------------------------------
| Debt securities issued to the | | 13 418 | 13 263 |
| public (Note 16) | | | |
--------------------------------------------------------------------------------
| Provisions and other liabilities | | 1 467 | 1 010 |
--------------------------------------------------------------------------------
| Tax liabilities | | 361 | 355 |
--------------------------------------------------------------------------------
| Subordinated liabilities (Note 17) | | 986 | 924 |
--------------------------------------------------------------------------------
| Total liabilities | | 23 308 | 22 368 |
--------------------------------------------------------------------------------
| Shareholders' equity | | | |
--------------------------------------------------------------------------------
| Share of parent company's owners | | | |
--------------------------------------------------------------------------------
| Share capital | | 428 | 428 |
--------------------------------------------------------------------------------
| Mutual Funds | | 790 | 793 |
--------------------------------------------------------------------------------
| Retained earnings | | 595 | 607 |
--------------------------------------------------------------------------------
| Total equity capital | | 1 813 | 1 828 |
--------------------------------------------------------------------------------
| Total liabilities and equity | | 25 120 | 24 196 |
| capital | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Statement of changes | | | | | | |
| in shareholders' | | | | | | |
| equity, 1 January-30 | | | | | | |
| June | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Attributable to equity holders of | | |
| | the parent | | |
--------------------------------------------------------------------------------
| EUR million | Share | Fair | Other | Retain | Minorit | Total |
| | capita | value | reserv | ed | y | equity |
| | l | reserv | es | earnin | interes | capital |
| | | e | | gs | t | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Equity capital 1 | 423 | 48 | 744 | 549 | 199 | 1 961 |
| January 2006 | | | | | | |
--------------------------------------------------------------------------------
| Adjusted | 423 | 48 | 744 | 549 | 199 | 1 961 |
| shareholders' equity | | | | | | |
| on 1 January | | | | | | |
--------------------------------------------------------------------------------
| Available-for-sale | | | | | | |
| financial assets | | | | | | |
--------------------------------------------------------------------------------
| Valuation gains and | | -49 | | | | -49 |
| losses | | | | | | |
--------------------------------------------------------------------------------
| Share transferred to | | -16 | | | | -16 |
| the income statement | | | | | | |
--------------------------------------------------------------------------------
| Deferred taxes | | 16 | | | | 16 |
--------------------------------------------------------------------------------
| Net income | | -49 | | -1 | | -49 |
| recognised under | | | | | | |
| shareholders' equity | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | 95 | 0 | 95 |
| period | | | | | | |
--------------------------------------------------------------------------------
| Total income and | | -49 | | 95 | 0 | 47 |
| expenses for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
| Share issue expenses | | | -1 | | | -1 |
--------------------------------------------------------------------------------
| Stock options | 1 | | 1 | | | 2 |
| exercised | | | | | | |
--------------------------------------------------------------------------------
| Dividends paid | | | | | | |
--------------------------------------------------------------------------------
| to series A share | | | | -95 | | -95 |
--------------------------------------------------------------------------------
| to series K share | | | | -25 | | -25 |
--------------------------------------------------------------------------------
| Acquisitions of | | | | | -198 | -198 |
| subsidiaries | | | | | | |
--------------------------------------------------------------------------------
| Equity capital 30 | 424 | -1 | 743 | 522 | 0 | 1 689 |
| June 2006 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Attributable to equity holders of | | |
| | the parent | | |
--------------------------------------------------------------------------------
| EUR million | Share | Fair | Other | Retain | Minorit | Total |
| | capita | value | reserv | ed | y | equity |
| | l | reserv | es | earnin | interes | capital |
| | | e | | gs | t | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Shareholders' | 428 | 47 | 747 | 607 | 0 | 1 828 |
| equity, 1 January | | | | | | |
| 2007 | | | | | | |
--------------------------------------------------------------------------------
| Adjusted | 428 | 47 | 747 | 607 | 0 | 1 828 |
| shareholders' equity | | | | | | |
| on 1 April | | | | | | |
--------------------------------------------------------------------------------
| Available-for-sale | | | | | | |
| financial assets | | | | | | |
--------------------------------------------------------------------------------
| Valuation gains and | | -23 | | | | -23 |
| losses | | | | | | |
--------------------------------------------------------------------------------
| Share transferred to | | 13 | | | | 13 |
| the income statement | | | | | | |
--------------------------------------------------------------------------------
| Deferred taxes | | 3 | | | | 3 |
--------------------------------------------------------------------------------
| Net income | | -8 | | 0 | | -8 |
| recognised under | | | | | | |
| shareholders' equity | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | 123 | 0 | 123 |
| period | | | | | | |
--------------------------------------------------------------------------------
| Total income | | -8 | | 123 | 0 | 115 |
| expenses for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
| Dividends paid | | | | | | |
--------------------------------------------------------------------------------
| Series A | | | | -104 | | -104 |
--------------------------------------------------------------------------------
| Series K | | | | -27 | | -27 |
--------------------------------------------------------------------------------
| Transfer of reserves | | | 4 | -4 | | |
--------------------------------------------------------------------------------
| Shareholders' | 428 | 39 | 750 | 595 | 0 | 1 813 |
| equity, 30 June 2007 | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Own funds and capital | | | | |
| adequacy | | | | |
--------------------------------------------------------------------------------
| EUR million | | 30 | 31 | 31 |
| | | Jun | Mar | Dec |
| | | 2007 | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Own funds | | | | |
--------------------------------------------------------------------------------
| Equity capital | | 1 813 | 1758 | 1 828 |
--------------------------------------------------------------------------------
| Minority interest | | 0 | 0 | 1 |
--------------------------------------------------------------------------------
| Hybrid capital *) | | 224 | 224 | 224 |
--------------------------------------------------------------------------------
| Intangible assets | | -854 | -855 | -859 |
--------------------------------------------------------------------------------
| Fair value reserve, excess | | -122 | -127 | -115 |
| funding of pension | | | | |
| liability, change in | | | | |
| equalisation provision and | | | | |
| change in fair value of | | | | |
| properties | | | | |
--------------------------------------------------------------------------------
| Dividend distribution | | - | - | -131 |
| proposed by Board of | | | | |
| Directors | | | | |
--------------------------------------------------------------------------------
| Planned profit distribution | | -61 | -25 | - |
--------------------------------------------------------------------------------
| Tier 1 own funds | | 999 | 975 | 948 |
--------------------------------------------------------------------------------
| Fair value reserve | | 39 | 57 | 47 |
--------------------------------------------------------------------------------
| Subordinated liabilities | | 299 | 200 | 200 |
| included in upper Tier 2 own | | | | |
| funds | | | | |
--------------------------------------------------------------------------------
| Subordinated liabilities | | 491 | 488 | 474 |
| included in lower Tier 2 own | | | | |
| funds | | | | |
--------------------------------------------------------------------------------
| Tier 2 own funds**) | | 828 | 745 | 721 |
--------------------------------------------------------------------------------
| Investments in insurance | | -163 | -163 | -157 |
| companies | | | | |
--------------------------------------------------------------------------------
| Other deduction items | | -1 | -8 | -8 |
--------------------------------------------------------------------------------
| Deduction items, total | | -164 | -171 | -165 |
--------------------------------------------------------------------------------
| Total own funds ***) | | 1 663 | 1 550 | 1 504 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Risk-weighted receivables, | | | | |
| investments and | | | | |
| off-balance-sheet | | | | |
| commitments | | | | |
--------------------------------------------------------------------------------
| Loan and guarantee portfolio excl. | 8 446 | 7 995 | 7 635 |
| intra-group items of OP Bank Group | | | |
--------------------------------------------------------------------------------
| Binding standby credit | | 1 258 | 1 322 | 1 408 |
| facilities | | | | |
--------------------------------------------------------------------------------
| Inter-group items of OP Bank | | 1 075 | 1 230 | 1 169 |
| Group | | | | |
--------------------------------------------------------------------------------
| Market risk | | 1 290 | 1 302 | 1 007 |
--------------------------------------------------------------------------------
| Other items (equities incl. Pohjola, | 396 | 389 | 407 |
| properties, other assets etc. | | | |
--------------------------------------------------------------------------------
| Risk-weighted receivables, | | 12 465 | 12 239 | 11 627 |
| investments and | | | | |
| off-balance-sheet items, | | | | |
| total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital adequacy ratio, % | | 13.3 | 12.7 | 12.9 |
--------------------------------------------------------------------------------
| Ratio of Tier 1 own funds to | | 8.0 | 8.0 | 8.2 |
| the aggregate amount of | | | | |
| risk-weighted items, % | | | | |
--------------------------------------------------------------------------------
| Capital adequacy ratio under | | 1.16 | 1.12 | 1.13 |
| the Act on Supervision of | | | | |
| Financial and Insurance | | | | |
| Conglomerates | | | | |
--------------------------------------------------------------------------------
The capital adequacy ratio of the OP Bank Group as per the Credit Institutions
Act was 14.3% and the Tier 1 ratio was 12.6%. The capital adequacy ratio of the
OP Bank Group calculated by the consolidation method as per the Act on the
Supervision of Financial and Insurance Conglomerates was 1.57.
*) OKO has four loans under hybrid capital that can be classified as Tier 1 own
funds:
Hybrid capital of 10 billion Japanese yen of which EUR 74 million has been
regarded as Tier 1 funds. Interest on the loan is fixed at 4.23% until 2034 and
thereafter variable 6-month Yen LIBOR1+58.58%. If interest cannot be paid for a
given interest period, the obligation to pay interest will lapse. The loan may
be called in at the earliest in 2014.
Hybrid capital of EUR 50 million, which is a perpetual loan without interest
rate step-ups, but with an 8% interest rate cap. The loan was issued on 31 March
2005, and the interest rate for the first year is 6.5%. Thereafter, the interest
rate will be CMS 10 years + 0.1%. Interest payments are annual. Subject to
authorisation by the Financial Supervision Authority, the loan may be called in
at the earliest in 2010. .
Hybrid capital of EUR 60 million, which is a perpetual loan. The loan was issued
on 30 November 2005, and the interest rate is variable 3-month EURIBOR +0.65%
until 2015 and thereafter variable 3-month EURIBOR 1.65%. Interest payments are
quarterly. If interest cannot be paid for a given interest period, the
obligation to pay interest will lapse. Subject to authorisation by the Financial
Supervision Authority, the loan may be called in at the earliest in
2015.
Hybrid capital of EUR 40 million, which is a perpetual loan. The loan was issued
on 30 November 2005, and the interest rate is variable 3-month EURIBOR 1.25%.
Interest payments are quarterly. If interest cannot be paid for a given interest
period, the obligation to pay interest will lapse. Subject to authorisation by
the Financial Supervision Authority, the loan may be called in at the earliest
in 2010. The hybrid capital has been hedged against the interest rate and
currency risk by interest rate and currency swaps at the date of issue.
**) Issue and repayment of loans considered Tier 2 funds 1 April - 30 June
2007:
"A EUR 50 million upper Tier 2 funds perpetual loan was repaid 19 June 2007,
authorised by the Financial Supervision Authority. A perpetual loan of GBP 100
million, regarded as upper Tier 2 own funds was issued on 28 June 2007, with EUR
148 million included in upper Tier 2 funds. Subject to authorisation by the
Financial Supervision Authority, the loan may be called in at the earliest in
2013.
**) The following investments in venture capital funds, totalling EUR 5 million
and managed by OKO Venture Capital Ltd, have not been deducted from own funds
according to the exception provided by the Financial Supervision Authority in
line with the order in §75, clause 5 o the Act on Credit Institutions: Promotion
Equity I Ky, Promotion Capital I Ky, Promotion Rahasto II Ky and Promotion
Bridge I Ky.
--------------------------------------------------------------------------------
| Cash flow statement | | | |
--------------------------------------------------------------------------------
| EUR million | | H1/ | H1/ |
| | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from operating | | | |
| activities | | | |
--------------------------------------------------------------------------------
| Profit for the period | | 123 | 95 |
--------------------------------------------------------------------------------
| Adjustments to reconcile profit | | 212 | 217 |
| for the period to cash used in | | | |
| operating activities | | | |
--------------------------------------------------------------------------------
| Increase (-) or decrease (+) in | | 31 | -2 818 |
| operating assets | | | |
--------------------------------------------------------------------------------
| Receivables from financial | | 424 | -151 |
| institutions | | | |
--------------------------------------------------------------------------------
| Financial assets held for trading | | 1 227 | -1 562 |
--------------------------------------------------------------------------------
| Derivative contracts | | -38 | -21 |
--------------------------------------------------------------------------------
| Receivables from customers | | -835 | -665 |
--------------------------------------------------------------------------------
| Non-life insurance assets | | -182 | -257 |
--------------------------------------------------------------------------------
| Investment assets | | 29 | -115 |
--------------------------------------------------------------------------------
| Other assets | | -594 | -47 |
--------------------------------------------------------------------------------
| Increase (+) or decrease (-) in | | 338 | 660 |
| operating liabilities | | | |
--------------------------------------------------------------------------------
| Liabilities to financial | | -461 | 854 |
| institutions | | | |
--------------------------------------------------------------------------------
| Financial liabilities held for | | 0 | -3 |
| trading | | | |
--------------------------------------------------------------------------------
| Derivative contracts | | 42 | 33 |
--------------------------------------------------------------------------------
| Liabilities to customers | | 235 | -405 |
--------------------------------------------------------------------------------
| Non-life Insurance liabilities | | 65 | 25 |
--------------------------------------------------------------------------------
| Provisions and other liabilities | | 457 | 155 |
--------------------------------------------------------------------------------
| | | | |
--------------------------------------------------------------------------------
| Income tax paid | | -37 | -22 |
--------------------------------------------------------------------------------
| Dividends received | | 39 | 27 |
--------------------------------------------------------------------------------
| A. Total cash flow from operating | | 706 | -1 841 |
| activities | | | |
--------------------------------------------------------------------------------
| Cash flow from investing | | | |
| activities | | | |
--------------------------------------------------------------------------------
| Acquisition of subsidiaries net of | | - | -303 |
| cash and cash equivalents acquired | | | |
--------------------------------------------------------------------------------
| Disposal of subsidiaries net of | | 6 | 217 |
| cash and cash equivalents disposed | | | |
| of | | | |
--------------------------------------------------------------------------------
| Acquisition of tangible and | | -12 | -12 |
| intangible assets | | | |
--------------------------------------------------------------------------------
| Disposal of tangible and | | 16 | 1 |
| intangible assets | | | |
--------------------------------------------------------------------------------
| B. Net cash provided by (used | | 10 | -97 |
| in)investing activities | | | |
--------------------------------------------------------------------------------
| Cash flow from financing | | | |
| activities | | | |
--------------------------------------------------------------------------------
| Increase in subordinated loans | | 148 | 150 |
--------------------------------------------------------------------------------
| Decrease in subordinated loans | | -84 | -162 |
--------------------------------------------------------------------------------
| Increase in debt securities issued | | 16 257 | 17 365 |
| to the public | | | |
--------------------------------------------------------------------------------
| Decrease in debt securities issued | | -16 089 | -14 633 |
| to the public | | | |
--------------------------------------------------------------------------------
| Increase in share capital | | - | 1 |
--------------------------------------------------------------------------------
| Dividends paid | | -131 | -120 |
--------------------------------------------------------------------------------
| C. Total cash flow from financing | | 101 | 2 601 |
| activities | | | |
--------------------------------------------------------------------------------
| Net increase/decrease in cash and | | 817 | 663 |
| cash equivalents (A+B+C) | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash and cash equivalents at the | | 1107 | 614 |
| beginning of the period | | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at the | | 1 924 | 1 277 |
| end of the period | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest received | | 861 | 466 |
--------------------------------------------------------------------------------
| Interest paid | | -821 | -445 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Adjustments to profit for the | | | |
| period | | | |
--------------------------------------------------------------------------------
| Items not associated with payment | | | |
--------------------------------------------------------------------------------
| Impairment losses on receivables | | -1 | -1 |
--------------------------------------------------------------------------------
| Unrealised net earnings in | | 208 | 200 |
| Non-life Insurance | | | |
--------------------------------------------------------------------------------
| Change in fair value for trading | | -6 | 8 |
--------------------------------------------------------------------------------
| Unrealised net gains on foreign | | -6 | -18 |
| exchange operations | | | |
--------------------------------------------------------------------------------
| Change in fair value of investment | | 0 | -1 |
| property | | | |
--------------------------------------------------------------------------------
| Scheduled amortisation | | 30 | 28 |
| /depreciation | | | |
--------------------------------------------------------------------------------
| Share of associates' profits | | 0 | 0 |
--------------------------------------------------------------------------------
| Other | | -13 | 4 |
--------------------------------------------------------------------------------
| Items presented outside cash flow | | | |
| from operating activities | | | |
--------------------------------------------------------------------------------
| Capital gains, share of cash flow | | 0 | -3 |
| from investing activities | | | |
--------------------------------------------------------------------------------
| Capital losses, share of cash flow from investing | 0 | 1 |
| activities | | |
--------------------------------------------------------------------------------
| Adjustments, total | | 212 | 217 |
--------------------------------------------------------------------------------
Segment information
--------------------------------------------------------------------------------
| Financial | Corpora | 2006 | Market | 2006 | Central | 2006 |
| performance from | te | | s | | Banking | |
| April to June | Banking | | 2007 | | 2007 | |
| EUR million | 2007 | | | | | |
--------------------------------------------------------------------------------
| Net interest income | 26 | 20 | 7 | 4 | 3 | 3 |
--------------------------------------------------------------------------------
| Impairment losses | 1 | 0 | | | | |
| on receivables | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | 25 | 20 | 7 | 4 | 3 | 3 |
| after impairment | | | | | | |
| losses | | | | | | |
--------------------------------------------------------------------------------
| Net income from | | | | | | |
| Non-life Insurance | | | | | | |
--------------------------------------------------------------------------------
| Net commissions and | 10 | 8 | 8 | 5 | 0 | 0 |
| fees | | | | | | |
--------------------------------------------------------------------------------
| Net trading income | 0 | 1 | 2 | 2 | 0 | 0 |
--------------------------------------------------------------------------------
| Net investment | 0 | 0 | 0 | 0 | 0 | 0 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Other operating | 4 | 3 | 0 | 0 | 3 | 2 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Total income | 39 | 32 | 17 | 11 | 6 | 6 |
--------------------------------------------------------------------------------
| of which | | | | | 0 | 0 |
| inter-segment | | | | | | |
| income | | | | | | |
--------------------------------------------------------------------------------
| Personnel costs | -7 | -5 | -4 | -3 | -1 | 0 |
--------------------------------------------------------------------------------
| IT expenses | -2 | -2 | -2 | -1 | 0 | 0 |
--------------------------------------------------------------------------------
| Amortisation on | | | | | | |
| intangible assets | | | | | | |
| from acquisitions | | | | | | |
--------------------------------------------------------------------------------
| Other amortisation | -4 | -3 | 0 | 0 | 0 | 0 |
| and depreciation | | | | | | |
--------------------------------------------------------------------------------
| Other expenses | -4 | -4 | -2 | -2 | -1 | -1 |
--------------------------------------------------------------------------------
| Total expenses | -16 | -14 | -8 | -7 | -1 | -1 |
--------------------------------------------------------------------------------
| Share of | | | | | | |
| associates' | | | | | | |
| profits/losses | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 23 | 19 | 9 | 4 | 4 | 4 |
| *) | | | | | | |
--------------------------------------------------------------------------------
| Income tax | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Key ratios % | | | | | | |
--------------------------------------------------------------------------------
| Operating | | | | | | |
| cost/income ratio | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
| Return on equity at | | | | | 13.5 | 14.1 |
| fair values | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial | Treasu | 2006 | Asset | 2006 | Banking | 2006 |
| performance from | ry | | Managemen | | and | |
| April to June | 2007 | | t | | Investme | |
| EUR million | | | 2007 | | nt | |
| | | | | | Services | |
| | | | | | , | |
| | | | | | total | |
| | | | | | 2007 | |
| | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | -1 | 2 | -1 | 0 | 34 | 28 |
--------------------------------------------------------------------------------
| Impairment losses | | | | | 1 | 0 |
| on receivables | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | -1 | 2 | -1 | 0 | 34 | 28 |
| after impairment | | | | | | |
| losses | | | | | | |
--------------------------------------------------------------------------------
| Net income from | | | | | | |
| Non-life Insurance | | | | | | |
--------------------------------------------------------------------------------
| Net commissions and | 0 | 0 | 12 | 8 | 30 | 22 |
| fees | | | | | | |
--------------------------------------------------------------------------------
| Net trading income | 1 | -1 | 0 | 0 | 2 | 2 |
--------------------------------------------------------------------------------
| Net investment | 13 | 8 | 0 | 0 | 13 | 8 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Other operating | 1 | 0 | 0 | 1 | 7 | 7 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Total income | 13 | 9 | 12 | 9 | 86 | 67 |
--------------------------------------------------------------------------------
| of which | 0 | 0 | 0 | 0 | 0 | 0 |
| inter-segment | | | | | | |
| income | | | | | | |
--------------------------------------------------------------------------------
| Personnel costs | 0 | 0 | -4 | -4 | -16 | -13 |
--------------------------------------------------------------------------------
| IT expenses | 0 | 0 | -1 | 0 | -5 | -4 |
--------------------------------------------------------------------------------
| Amortisation on | | | -1 | -1 | -1 | -1 |
| intangible assets | | | | | | |
| from acquisitions | | | | | | |
--------------------------------------------------------------------------------
| Other amortisation | 0 | 0 | 0 | 0 | -4 | -4 |
| and depreciation | | | | | | |
--------------------------------------------------------------------------------
| Other expenses | -1 | -1 | -1 | -1 | -8 | -8 |
--------------------------------------------------------------------------------
| Total expenses | -1 | -1 | -7 | -6 | -34 | -29 |
--------------------------------------------------------------------------------
| Share of | | | | | | |
| associates' | | | | | | |
| profits/losses | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 12 | 7 | 5 | 3 | 52 | 37 |
--------------------------------------------------------------------------------
| Income tax | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Key ratios, % | | | | | | |
--------------------------------------------------------------------------------
| Operating | | | 54 | 60 | 38 | 43 |
| cost/income ratio | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | | 17.7 | 14.0 |
| equity | | | | | | |
--------------------------------------------------------------------------------
| Return on equity at | | | | | | |
| fair values | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial performance | Non-life | Non-life | Other | Other |
| from April to June | Insurance | Insurance | operations | operations |
| EUR million | 2007 | 2006 | 2007 | 2006 |
--------------------------------------------------------------------------------
| Net interest income | -2 | -3 | -3 | -1 |
--------------------------------------------------------------------------------
| Impairment losses on | | | | |
| receivables | | | | |
--------------------------------------------------------------------------------
| Net interest income after | -2 | -3 | -3 | -1 |
| impairment losses | | | | |
--------------------------------------------------------------------------------
| Net income from Non-life | 114 | 91 | | |
| Insurance | | | | |
--------------------------------------------------------------------------------
| Net commissions and fees | 2 | 1 | 0 | 0 |
--------------------------------------------------------------------------------
| Net trading income | | | 0 | 0 |
--------------------------------------------------------------------------------
| Net investment income | | -1 | 0 | 3 |
--------------------------------------------------------------------------------
| Other operating income | 15 | 5 | 6 | 12 |
--------------------------------------------------------------------------------
| Total income | 129 | 94 | 3 | 13 |
--------------------------------------------------------------------------------
| of which inter-segment | | 0 | 3 | 9 |
| income | | | | |
--------------------------------------------------------------------------------
| Personnel costs | -27 | -29 | -1 | -3 |
--------------------------------------------------------------------------------
| IT expenses | -2 | -4 | -4 | -4 |
--------------------------------------------------------------------------------
| Amortisation on | -8 | -8 | | |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Other amortisation and | -1 | 0 | -1 | -1 |
| depreciation | | | | |
--------------------------------------------------------------------------------
| Other expenses | -37 | -29 | -2 | -8 |
--------------------------------------------------------------------------------
| Total expenses | -76 | -70 | -8 | -17 |
--------------------------------------------------------------------------------
| Share of associates' | 0 | 0 | 0 | 0 |
| profits/losses | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 52 | 24 | -5 | -4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial performance | Eliminati | Eliminatio | OKO Bank | OKO Bank |
| from April to June | ons 2007 | ns 2006 | Group 2007 | Group 2006 |
| EUR million | | | | |
--------------------------------------------------------------------------------
| Net interest income | 2 | 1 | 32 | 25 |
--------------------------------------------------------------------------------
| Impairment losses on | | | 1 | 0 |
| receivables | | | | |
--------------------------------------------------------------------------------
| Net interest income after | 2 | 1 | 31 | 25 |
| impairment losses | | | | |
--------------------------------------------------------------------------------
| Net income from Non-life | -1 | -1 | 113 | 90 |
| Insurance | | | | |
--------------------------------------------------------------------------------
| Net commissions and fees | -1 | 0 | 31 | 23 |
--------------------------------------------------------------------------------
| Net trading income | | 0 | 3 | 2 |
--------------------------------------------------------------------------------
| Net investment income | | 0 | 13 | 9 |
--------------------------------------------------------------------------------
| Other operating income | -4 | -11 | 24 | 13 |
--------------------------------------------------------------------------------
| Total income | -4 | -11 | 214 | 163 |
--------------------------------------------------------------------------------
| of which inter-segment | -3 | -10 | - | - |
| income | | | | |
--------------------------------------------------------------------------------
| Personnel costs | | 0 | -45 | -45 |
--------------------------------------------------------------------------------
| IT expenses | 0 | 0 | -11 | -11 |
--------------------------------------------------------------------------------
| Amortisation on | | | -9 | -9 |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Other amortisation and | | | -6 | -5 |
| depreciation | | | | |
--------------------------------------------------------------------------------
| Other expenses | 4 | 11 | -43 | -35 |
--------------------------------------------------------------------------------
| Total expenses | 4 | 10 | -114 | -105 |
--------------------------------------------------------------------------------
| Share of associates' | | | 0 | 0 |
| profits/losses | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 0 | 0 | 100 | 57 |
--------------------------------------------------------------------------------
| Income tax | | | -27 | -15 |
--------------------------------------------------------------------------------
| Profit before the period | | | 73 | 42 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Key ratios, % | | | | |
--------------------------------------------------------------------------------
| Operating cost/income | | | | |
| ratio | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | |
| equity | | | | |
--------------------------------------------------------------------------------
| Return on equity at fair | | | 12.2 | 2.1 |
| values | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-life Insurance by | Private | 2006 | Corporate | 2006 |
| division | Customers | | Customers | |
| | 2007 | | 2007 | |
--------------------------------------------------------------------------------
| Balance on technical | | | | |
| account, EUR million | | | | |
--------------------------------------------------------------------------------
| Insurance premium revenue | 93 | 82 | 112 | 108 |
--------------------------------------------------------------------------------
| Claims incurred | 54 | 52 | 83 | 82 |
--------------------------------------------------------------------------------
| Amortisation on | 3 | 2 | 3 | 3 |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Operating expenses | 26 | 21 | 18 | 19 |
--------------------------------------------------------------------------------
| Total expenses | 83 | 75 | 105 | 104 |
--------------------------------------------------------------------------------
| Balance on technical | 10 | 7 | 7 | 3 |
| account | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Key ratios, % | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | |
| equity | | | | |
--------------------------------------------------------------------------------
| Loss ratio | 58.3 | 63.2 | 74.4 | 76.3 |
--------------------------------------------------------------------------------
| Expense ratio | 28.3 | 25.5 | 16.0 | 17.9 |
--------------------------------------------------------------------------------
| Operating combined ratio | 86.6 | 88.7 | 90.4 | 94.2 |
--------------------------------------------------------------------------------
| Combined ratio | 89.5 | 91.4 | 93.5 | 96.9 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-life Insurance by | Baltic | 2006 | Total | 2006 |
| division | States | | 2007 | |
| | 2007 | | | |
--------------------------------------------------------------------------------
| Balance on technical | | | | |
| account, EUR million | | | | |
--------------------------------------------------------------------------------
| Insurance premium revenue | 14 | 11 | 219 | 200 |
--------------------------------------------------------------------------------
| Claims incurred | 10 | 7 | 148 | 140 |
--------------------------------------------------------------------------------
| Amortisation on | 0 | 0 | 7 | 6 |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Operating expenses | 4 | 3 | 48 | 43 |
--------------------------------------------------------------------------------
| Total expenses | 14 | 10 | 202 | 189 |
--------------------------------------------------------------------------------
| Balance on technical | 0 | 1 | 17 | 11 |
| account | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Key ratios, % | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | 26.9 | -14.4 |
| equity | | | | |
--------------------------------------------------------------------------------
| Loss ratio | 74.0 | 59.9 | 67.5 | 70.0 |
--------------------------------------------------------------------------------
| Expense ratio | 26.5 | 28.2 | 21.9 | 21.6 |
--------------------------------------------------------------------------------
| Operating combined ratio | 100.5 | 88.1 | 89.3 | 91.6 |
--------------------------------------------------------------------------------
| Combined ratio | 102.7 | 90.8 | 92.3 | 94.4 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial | Corpora | 2006 | Market | 2006 | Central | 2006 |
| performance from | te | | s | | Banking | |
| January to June | Banking | | 2007 | | 2007 | |
| EUR million | 2007 | | | | | |
--------------------------------------------------------------------------------
| Net interest income | 50 | 42 | 11 | 8 | 6 | 6 |
--------------------------------------------------------------------------------
| Impairment losses | 0 | -1 | | | | |
| on receivables | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | 49 | 42 | 11 | 8 | 6 | 6 |
| after impairment | | | | | | |
| losses | | | | | | |
--------------------------------------------------------------------------------
| Net income from | | | | | | |
| Non-life Insurance | | | | | | |
--------------------------------------------------------------------------------
| Net commissions and | 20 | 16 | 14 | 10 | 0 | 0 |
| fees | | | | | | |
--------------------------------------------------------------------------------
| Net trading income | 1 | 1 | 7 | 2 | 1 | 1 |
--------------------------------------------------------------------------------
| Net investment | 1 | 0 | 0 | 0 | 0 | 0 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Other operating | 8 | 6 | -1 | 0 | 5 | 5 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Total income | 80 | 66 | 31 | 20 | 11 | 12 |
--------------------------------------------------------------------------------
| of which | | | | | 1 | 0 |
| inter-segment | | | | | | |
| income | | | | | | |
--------------------------------------------------------------------------------
| Personnel costs | -12 | -10 | -8 | -6 | -1 | -1 |
--------------------------------------------------------------------------------
| IT expenses | -4 | -3 | -3 | -3 | 0 | -1 |
--------------------------------------------------------------------------------
| Amortisation on | | | | | | |
| intangible assets | | | | | | |
| from acquisitions | | | | | | |
--------------------------------------------------------------------------------
| Other amortisation | -7 | -6 | -1 | -1 | 0 | 0 |
| and depreciation | | | | | | |
--------------------------------------------------------------------------------
| Other expenses | -7 | -8 | -3 | -3 | -1 | -1 |
--------------------------------------------------------------------------------
| Total expenses | -31 | -27 | -15 | -13 | -2 | -3 |
--------------------------------------------------------------------------------
| Share of | | | | | | |
| associates' | | | | | | |
| profits/losses | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 49 | 39 | 16 | 7 | 9 | 9 |
| *) | | | | | | |
--------------------------------------------------------------------------------
| Income tax | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Key figures, % | | | | | | |
--------------------------------------------------------------------------------
| Operating | | | | | | |
| cost/income ratio | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
| Return on equity at | | | | | 14.7 | 15.0 |
| fair values | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial | Treasu | 2006 | Asset | 2006 | Banking | 2006 |
| performance from | ry | | Managemen | | and | |
| January to June | 2007 | | t | | Investme | |
| EUR million | | | 2007 | | nt | |
| | | | | | Services | |
| | | | | | , | |
| | | | | | total | |
| | | | | | 2007 | |
| | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | -2 | 3 | -1 | 0 | 64 | 58 |
--------------------------------------------------------------------------------
| Impairment losses | | | | | 0 | -1 |
| on receivables | | | | | | |
--------------------------------------------------------------------------------
| Net interest income | -2 | 3 | -1 | 0 | 63 | 59 |
| after impairment | | | | | | |
| losses | | | | | | |
--------------------------------------------------------------------------------
| Net income from | | | | | | |
| Non-life Insurance | | | | | | |
--------------------------------------------------------------------------------
| Net commissions and | 0 | 0 | 22 | 18 | 56 | 45 |
| fees | | | | | | |
--------------------------------------------------------------------------------
| Net trading income | 1 | 1 | | | 9 | 5 |
--------------------------------------------------------------------------------
| Net investment | 17 | 21 | 0 | | 18 | 21 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Other operating | 1 | 1 | 0 | 2 | 14 | 13 |
| income | | | | | | |
--------------------------------------------------------------------------------
| Total income | 17 | 25 | 22 | 20 | 160 | 143 |
--------------------------------------------------------------------------------
| of which | | 0 | 1 | 1 | 1 | 1 |
| inter-segment | | | | | | |
| income | | | | | | |
--------------------------------------------------------------------------------
| Personnel costs | -1 | -1 | -8 | -8 | -30 | -26 |
--------------------------------------------------------------------------------
| IT expenses | -1 | 0 | -1 | -1 | -10 | -8 |
--------------------------------------------------------------------------------
| Amortisation on | | | -1 | -1 | -1 | -1 |
| intangible assets | | | | | | |
| from acquisitions | | | | | | |
--------------------------------------------------------------------------------
| Other amortisation | 0 | 0 | 0 | 0 | -8 | -7 |
| and depreciation | | | | | | |
--------------------------------------------------------------------------------
| Other expenses | -1 | -1 | -2 | -3 | -15 | -17 |
--------------------------------------------------------------------------------
| Total expenses | -3 | -3 | -13 | -14 | -64 | -59 |
--------------------------------------------------------------------------------
| Share of | | | | | | |
| associates' | | | | | | |
| profits/losses | | | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 14 | 22 | 9 | 6 | 97 | 84 |
--------------------------------------------------------------------------------
| Income tax | | | | | | |
--------------------------------------------------------------------------------
| Profit for the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Key ratios, % | | | | | | |
--------------------------------------------------------------------------------
| Operating | | | 54 | 61 | 39 | 40 |
| cost/income ratio | | | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | | 17.7 | 16.4 |
| equity | | | | | | |
--------------------------------------------------------------------------------
| Return on equity at | | | | | | |
| fair values | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial performance | Non-life | Non-life | Other | Other |
| from January to June | Insurance | Insurance | operations | operations |
| EUR million | 2007 | 2006 | 2007 | 2006 |
--------------------------------------------------------------------------------
| Net interest income | -4 | -4 | -5 | -4 |
--------------------------------------------------------------------------------
| Impairment losses on | | | | |
| receivables | | | | |
--------------------------------------------------------------------------------
| Net interest income after | -4 | -4 | -5 | -4 |
| impairment losses | | | | |
--------------------------------------------------------------------------------
| Net income from Non-life | 209 | 177 | | |
| Insurance | | | | |
--------------------------------------------------------------------------------
| Net commissions and fees | 6 | 5 | 0 | -1 |
--------------------------------------------------------------------------------
| Net trading income | | | 0 | 0 |
--------------------------------------------------------------------------------
| Net investment income | | -1 | 4 | 9 |
--------------------------------------------------------------------------------
| Other operating income | 18 | 9 | 12 | 25 |
--------------------------------------------------------------------------------
| Total income | 229 | 186 | 12 | 29 |
--------------------------------------------------------------------------------
| of which inter-segment | | 0 | 5 | 19 |
| income | | | | |
--------------------------------------------------------------------------------
| Personnel costs | -54 | -53 | -3 | -8 |
--------------------------------------------------------------------------------
| IT expenses | -6 | -7 | -7 | -8 |
--------------------------------------------------------------------------------
| Amortisation on | -17 | -17 | | |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Other amortisation and | -2 | -1 | -2 | -2 |
| depreciation | | | | |
--------------------------------------------------------------------------------
| Other expenses | -69 | -62 | -15 | -16 |
--------------------------------------------------------------------------------
| Total expenses | -146 | -139 | -27 | -33 |
--------------------------------------------------------------------------------
| Share of associates' | 0 | 0 | 0 | 0 |
| profits/losses | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 83 | 47 | -15 | -5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial performance | Eliminati | Eliminatio | OKO Bank | OKO Bank |
| from January to June | ons 2007 | ns 2006 | Group 2007 | Group 2006 |
| EUR million | | | | |
--------------------------------------------------------------------------------
| Net interest income | 3 | 1 | 58 | 51 |
--------------------------------------------------------------------------------
| Impairment losses on | | | 0 | -1 |
| receivables | | | | |
--------------------------------------------------------------------------------
| Net interest income after | 3 | 1 | 58 | 52 |
| impairment losses | | | | |
--------------------------------------------------------------------------------
| Net income from Non-life | -1 | -1 | 208 | 176 |
| Insurance | | | | |
--------------------------------------------------------------------------------
| Net commissions and fees | -2 | 0 | 59 | 48 |
--------------------------------------------------------------------------------
| Net trading income | 0 | 0 | 10 | 5 |
--------------------------------------------------------------------------------
| Net investment income | | 0 | 23 | 29 |
--------------------------------------------------------------------------------
| Other operating income | -8 | -22 | 36 | 25 |
--------------------------------------------------------------------------------
| Total income | -9 | -22 | 393 | 336 |
--------------------------------------------------------------------------------
| of which inter-segment | -7 | -20 | - | - |
| income | | | | |
--------------------------------------------------------------------------------
| Personnel costs | | | -86 | -87 |
--------------------------------------------------------------------------------
| IT expenses | 0 | 0 | -22 | -22 |
--------------------------------------------------------------------------------
| Amortisation on | | | -18 | -18 |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Other amortisation and | | | -12 | -10 |
| depreciation | | | | |
--------------------------------------------------------------------------------
| Other expenses | 8 | 22 | -91 | -72 |
--------------------------------------------------------------------------------
| Total expenses | 9 | 22 | -228 | -209 |
--------------------------------------------------------------------------------
| Share of associates' | | | 0 | 0 |
| profits/losses | | | | |
--------------------------------------------------------------------------------
| Earnings before tax | 0 | 0 | 165 | 126 |
--------------------------------------------------------------------------------
| Income tax | | | -42 | -31 |
--------------------------------------------------------------------------------
| Profit before the period | | | 123 | 95 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Key ratios, % | | | | |
--------------------------------------------------------------------------------
| Operating cost/income | | | | |
| ratio | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | |
| equity | | | | |
--------------------------------------------------------------------------------
| Return on equity at fair | | | 12.8 | 5.2 |
| values | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-life Insurance by | Private | 2006 | Corporate | 2006 |
| division | Customers | | Customers | |
| | 2007 | | 2007 | |
--------------------------------------------------------------------------------
| Balance on technical | | | | |
| account, EUR million | | | | |
--------------------------------------------------------------------------------
| Insurance premium revenue | 173 | 154 | 223 | 212 |
--------------------------------------------------------------------------------
| Claims incurred | 111 | 103 | 177 | 164 |
--------------------------------------------------------------------------------
| Amortisation on | 5 | 5 | 7 | 7 |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Operating expenses | 50 | 41 | 38 | 41 |
--------------------------------------------------------------------------------
| Total expenses | 166 | 150 | 221 | 211 |
--------------------------------------------------------------------------------
| Balance on technical | 6 | 5 | 2 | -1 |
| account | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Key ratios, % | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | | |
| equity | | | | |
--------------------------------------------------------------------------------
| Loss ratio | 64.4 | 66.8 | 79.1 | 77.1 |
--------------------------------------------------------------------------------
| Expense ratio | 28.7 | 26.7 | 17.1 | 19.2 |
--------------------------------------------------------------------------------
| Operating combined ratio | 93.2 | 93.5 | 96.2 | 96.4 |
--------------------------------------------------------------------------------
| Combined ratio | 96.3 | 97.0 | 99.2 | 99.5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-life Insurance by | Baltic | 2006 | Total | 2006 |
| division | States | | 2007 | |
| | 2007 | | | |
--------------------------------------------------------------------------------
| Balance on technical | | | | |
| account, EUR million | | | | |
--------------------------------------------------------------------------------
| Insurance premium revenue | 27 | 21 | 423 | 388 |
--------------------------------------------------------------------------------
| Claims incurred | 19 | 13 | 307 | 279 |
--------------------------------------------------------------------------------
| Amortisation on | 1 | 1 | 13 | 13 |
| intangible assets from | | | | |
| acquisitions | | | | |
--------------------------------------------------------------------------------
| Operating expenses | 7 | 6 | 95 | 88 |
--------------------------------------------------------------------------------
| Total expenses | 26 | 19 | 414 | 380 |
--------------------------------------------------------------------------------
| Balance on technical | 1 | 2 | 9 | 7 |
| account | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Key ratios, % | | | | |
--------------------------------------------------------------------------------
| Operating return on | | | 30.7 | 4.5 |
| equity | | | | |
--------------------------------------------------------------------------------
| Loss ratio | 69.8 | 60.4 | 72.5 | 72.1 |
--------------------------------------------------------------------------------
| Expense ratio | 25.0 | 27.6 | 22.4 | 22.7 |
--------------------------------------------------------------------------------
| Operating combined ratio | 94.8 | 87.9 | 94.9 | 94.8 |
--------------------------------------------------------------------------------
| Combined ratio | 97.0 | 90.7 | 97.9 | 98.2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance sheet | Corpora | Market | Central | Treasur | Asset | Banking |
| 30 June 2007 | te | s | Banking | y | Managemen | and |
| EUR million | Banking | | | | t | Investmen |
| | | | | | | t |
| | | | | | | Services, |
| | | | | | | total |
--------------------------------------------------------------------------------
| Receivables | 8 619 | 3 | 59 | 7 | | 8 688 |
| from | | | | | | |
| customers | | | | | | |
--------------------------------------------------------------------------------
| Receivables | 173 | 60 | 5 915 | 700 | 3 | 6 852 |
| from | | | | | | |
| financial | | | | | | |
| institutions | | | | | | |
--------------------------------------------------------------------------------
| Non-life | | | | | | |
| insurance | | | | | | |
| assets | | | | | | |
--------------------------------------------------------------------------------
| Financial | 384 | 815 | 1 482 | 1 034 | 14 | 3 729 |
| assets for | | | | | | |
| trading and | | | | | | |
| investment | | | | | | |
| assets | | | | | | |
--------------------------------------------------------------------------------
| Investments | | | | | | |
| in associates | | | | | | |
--------------------------------------------------------------------------------
| Other assets | 228 | 1 300 | 55 | 117 | 129 | 1 829 |
--------------------------------------------------------------------------------
| Total assets | 9 404 | 2 178 | 7 511 | 1 859 | 146 | 21 099 |
--------------------------------------------------------------------------------
| Liabilities | 340 | 18 | 974 | 819 | | 2 150 |
| to customers | | | | | | |
--------------------------------------------------------------------------------
| Liabilities | 0 | 234 | 1 500 | 196 | | 1 930 |
| to financial | | | | | | |
| institutions | | | | | | |
--------------------------------------------------------------------------------
| Non-life | | | | | | |
| insurance | | | | | | |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Debt | | | | 13 523 | | 13 523 |
| securities | | | | | | |
| issued to the | | | | | | |
| public | | | | | | |
--------------------------------------------------------------------------------
| Subordinated | | | | 986 | | 986 |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Other | 394 | 1 102 | 36 | 396 | 12 | 1 940 |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Total | 734 | 1 353 | 2 509 | 15 920 | 12 | 20 529 |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Equity | | | | | | |
| Capital | | | | | | |
--------------------------------------------------------------------------------
| Total | | | | | | |
| liabilities | | | | | | |
| and | | | | | | |
| shareholders' | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital | 2 | 0 | 0 | 1 | 1 | 4 |
| expenditure | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance sheet | Non-life | Other | Eliminatio | OKO Bank Group |
| 30 June 2007 | Insurance | Operations, | ns | |
| EUR million | , | total | | |
| | total | | | |
--------------------------------------------------------------------------------
| Receivables from | | 53 | -53 | 8 687 |
| customers | | | | |
--------------------------------------------------------------------------------
| Receivables from | | 10 | -15 | 6 847 |
| financial | | | | |
| institutions | | | | |
--------------------------------------------------------------------------------
| Non-life insurance | 3 074 | | -142 | 2 932 |
| assets | | | | |
--------------------------------------------------------------------------------
| Financial assets | 0 | 43 | -11 | 3 762 |
| for trading and | | | | |
| investment assets | | | | |
--------------------------------------------------------------------------------
| Investments in | 2 | | | 2 |
| associates | | | | |
--------------------------------------------------------------------------------
| Other assets | 899 | 184 | -22 | 2 890 |
--------------------------------------------------------------------------------
| Total assets | 3 975 | 290 | -241 | 25 120 |
--------------------------------------------------------------------------------
| Liabilities to | | 143 | -64 | 2 229 |
| customers | | | | |
--------------------------------------------------------------------------------
| Liabilities to | 0 | 0 | 0 | 1 929 |
| financial | | | | |
| institutions | | | | |
--------------------------------------------------------------------------------
| Non-life insurance | 2 355 | | | 2 355 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Debt securities | | | -105 | 13 418 |
| issued to the | | | | |
| public | | | | |
--------------------------------------------------------------------------------
| Subordinated | 40 | | -40 | 986 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Other liabilities | 92 | 390 | -32 | 2 390 |
--------------------------------------------------------------------------------
| Total liabilities | 2 487 | 533 | -243 | 23 308 |
--------------------------------------------------------------------------------
| Shareholders' | | | | 1 813 |
| equity | | | | |
--------------------------------------------------------------------------------
| Total liabilities | | | | 25 120 |
| and shareholders' | | | | |
| equity | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital | 5 | 1 | | 10 |
| expenditure | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance sheet | Corpora | Market | Central | Treasur | Asset | Banking |
| 31 December | te | s | Banking | y | Managemen | and |
| 2006 | Banking | | | | t | Investmen |
| EUR million | | | | | | t |
| | | | | | | Services, |
| | | | | | | total |
--------------------------------------------------------------------------------
| Receivables | 7 788 | 12 | 58 | 9 | | 7 868 |
| from | | | | | | |
| customers | | | | | | |
--------------------------------------------------------------------------------
| Receivables | 300 | 58 | 5 785 | 463 | 1 | 6 607 |
| from | | | | | | |
| financial | | | | | | |
| institutions | | | | | | |
--------------------------------------------------------------------------------
| Non-life | | | | | | |
| insurance | | | | | | |
| assets | | | | | | |
--------------------------------------------------------------------------------
| Financial | 336 | 851 | 2 284 | 1 512 | 23 | 5 006 |
| assets for | | | | | | |
| trading and | | | | | | |
| investment | | | | | | |
| assets | | | | | | |
--------------------------------------------------------------------------------
| Investments | | | | | | |
| in associates | | | | | | |
--------------------------------------------------------------------------------
| Other assets | 177 | 563 | 51 | 75 | 128 | 994 |
--------------------------------------------------------------------------------
| Total assets | 8 602 | 1 484 | 8 177 | 2 059 | 152 | 20 475 |
--------------------------------------------------------------------------------
| Liabilities | 358 | 5 | 981 | 839 | | 2 184 |
| to customers | | | | | | |
--------------------------------------------------------------------------------
| Liabilities | | 259 | 1 752 | 381 | | 2 391 |
| to financial | | | | | | |
| institutions | | | | | | |
--------------------------------------------------------------------------------
| Non-life | | | | | | |
| insurance | | | | | | |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Debt | | | | 13 898 | | 13 898 |
| securities | | | | | | |
| issued to the | | | | | | |
| public | | | | | | |
--------------------------------------------------------------------------------
| Subordinated | | | | 924 | | 924 |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Other | 406 | 475 | 35 | 284 | 14 | 1 214 |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Total | 764 | 740 | 2 767 | 16 327 | 14 | 20 611 |
| liabilities | | | | | | |
--------------------------------------------------------------------------------
| Equity | | | | | | |
| Capital | | | | | | |
--------------------------------------------------------------------------------
| Total | | | | | | |
| liabilities | | | | | | |
| and | | | | | | |
| shareholders' | | | | | | |
| equity | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital | 5 | 1 | 0 | 2 | 1 | 9 |
| expenditure | | | | | | |
--------------------------------------------------------------------------------
| Amortisation | -13 | -1 | 0 | 0 | -3 | -18 |
| and | | | | | | |
| depreciation | | | | | | |
| during the | | | | | | |
| period | | | | | | |
--------------------------------------------------------------------------------
| Other items | 2 | 0 | 0 | 1 | 1 | 4 |
| non-cash | | | | | | |
| items excl. | | | | | | |
| amortisation | | | | | | |
| and | | | | | | |
| depreciation | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance sheet | Non-life | Other | Eliminatio | OKO Bank Group |
| 31 December 2006 | Insurance | Operations, | ns | |
| EUR million | , | total | | |
| | total | | | |
--------------------------------------------------------------------------------
| Receivables from | | | -4 | 7 864 |
| customers | | | | |
--------------------------------------------------------------------------------
| Receivables from | | 66 | -220 | 6 453 |
| financial | | | | |
| institutions | | | | |
--------------------------------------------------------------------------------
| Non-life insurance | 2 824 | | -58 | 2 766 |
| assets | | | | |
--------------------------------------------------------------------------------
| Financial assets | 0 | 687 | -666 | 5 026 |
| for trading and | | | | |
| investment assets | | | | |
--------------------------------------------------------------------------------
| Investments in | 2 | 7 | | 8 |
| associates | | | | |
--------------------------------------------------------------------------------
| Other assets | 901 | 298 | -113 | 2 079 |
--------------------------------------------------------------------------------
| Total assets | 3 726 | 1 058 | -1 061 | 24 196 |
--------------------------------------------------------------------------------
| Liabilities to | | 140 | -330 | 1 994 |
| customers | | | | |
--------------------------------------------------------------------------------
| Liabilities to | | | -1 | 2 390 |
| financial | | | | |
| institutions | | | | |
--------------------------------------------------------------------------------
| Non-life insurance | 2 099 | | | 2 099 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Debt securities | | | -635 | 13 263 |
| issued to the | | | | |
| public | | | | |
--------------------------------------------------------------------------------
| Subordinated | 40 | | -40 | 924 |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Other liabilities | 156 | 384 | -57 | 1 697 |
--------------------------------------------------------------------------------
| Total liabilities | 2 295 | 523 | -1 062 | 22 368 |
--------------------------------------------------------------------------------
| Shareholders' | | | | 1 828 |
| equity | | | | |
--------------------------------------------------------------------------------
| Total liabilities | | | | 24 196 |
| and shareholders' | | | | |
| equity | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| Capital | 10 | 3 | | 21 |
| expenditure | | | | |
--------------------------------------------------------------------------------
| Amortisation and | -35 | -4 | | -57 |
| depreciation | | | | |
| during the period | | | | |
--------------------------------------------------------------------------------
| Other non-cash | 0 | 0 | | 8 |
| items excl. | | | | |
| amortisation and | | | | |
| depreciation | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Notes | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Net interest income | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q3/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest income | | | | |
--------------------------------------------------------------------------------
| Receivables from financial | 68 | 40 | 132 | 74 |
| institutions | | | | |
--------------------------------------------------------------------------------
| Receivables from customers | 92 | 63 | 181 | 114 |
--------------------------------------------------------------------------------
| Other | 386 | 194 | 670 | 357 |
--------------------------------------------------------------------------------
| Total | 546 | 297 | 983 | 545 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest expenses | | | | |
--------------------------------------------------------------------------------
| Liabilities to financial | 23 | 26 | 43 | 48 |
| institutions | | | | |
--------------------------------------------------------------------------------
| Liabilities to customers | 18 | 12 | 37 | 23 |
--------------------------------------------------------------------------------
| Other | 473 | 235 | 845 | 423 |
--------------------------------------------------------------------------------
| Total | 514 | 272 | 925 | 494 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net interest income | 32 | 25 | 58 | 51 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 2) Impairment losses on | | | | |
| receivables | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Receivables amortised as loan | 3 | 0 | 3 | 1 |
| or guarantee losses | | | | |
--------------------------------------------------------------------------------
| Increase in impairment loss | 1 | 0 | 1 | 1 |
| provisions | | | | |
--------------------------------------------------------------------------------
| Decrease in impairment loss | 3 | 0 | 4 | 3 |
| provisions | | | | |
--------------------------------------------------------------------------------
| Impairment losses on | 1 | 0 | 0 | -1 |
| receivables, total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 3) Net income from Non-life | | | | |
| Insurance | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net insurance premium revenue | | | | |
--------------------------------------------------------------------------------
| Premiums written | 209 | 184 | 642 | 589 |
--------------------------------------------------------------------------------
| Insurance premiums ceded to | -11 | -8 | -40 | -35 |
| reinsurers | | | | |
--------------------------------------------------------------------------------
| Change in provision for | 23 | 29 | -193 | -177 |
| unearned premiums | | | | |
--------------------------------------------------------------------------------
| Reinsurers' share | -2 | -5 | 14 | 11 |
--------------------------------------------------------------------------------
| Total | 219 | 200 | 423 | 388 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net Non-life Insurance claims | | | | |
--------------------------------------------------------------------------------
| Claims paid | 126 | 116 | 275 | 235 |
--------------------------------------------------------------------------------
| Insurance claims recovered | -3 | 5 | -4 | 11 |
| from reinsurers | | | | |
--------------------------------------------------------------------------------
| Change in provision for | 13 | 10 | 15 | 10 |
| unpaid claims | | | | |
--------------------------------------------------------------------------------
| Reinsurers' share | -2 | -2 | -4 | 2 |
--------------------------------------------------------------------------------
| Total | 136 | 129 | 283 | 258 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net investment income, | | | | |
| Non-life Insurance | | | | |
--------------------------------------------------------------------------------
| Interest rates | 18 | 19 | 35 | 36 |
--------------------------------------------------------------------------------
| Net realised gains and | | | | |
| realised fair value gains and | | | | |
| losses | | | | |
--------------------------------------------------------------------------------
| Notes and bonds | -9 | -2 | -28 | -4 |
--------------------------------------------------------------------------------
| Shares and participations | 10 | 5 | 42 | 9 |
--------------------------------------------------------------------------------
| Investment property | 3 | 0 | 3 | 1 |
--------------------------------------------------------------------------------
| Other | 1 | 3 | -3 | 5 |
--------------------------------------------------------------------------------
| Unrealised fair value gains | | | | |
| and losses | | | | |
--------------------------------------------------------------------------------
| Notes and bonds | 0 | -1 | 0 | -1 |
--------------------------------------------------------------------------------
| Other | 2 | -1 | 3 | -1 |
--------------------------------------------------------------------------------
| Dividend income | 15 | 7 | 33 | 20 |
--------------------------------------------------------------------------------
| Total | 39 | 29 | 85 | 65 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Unwinding of discount | -10 | -9 | -19 | -18 |
--------------------------------------------------------------------------------
| Other | 1 | 0 | 2 | 0 |
--------------------------------------------------------------------------------
| Net income from Non-life | 113 | 90 | 208 | 176 |
| Insurance, total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 4) Net commissions and fees | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Commission income from | | | | |
--------------------------------------------------------------------------------
| Lending | 5 | 4 | 11 | 7 |
--------------------------------------------------------------------------------
| Payment transfers | 3 | 3 | 6 | 6 |
--------------------------------------------------------------------------------
| Securities brokerage | 6 | 4 | 13 | 12 |
--------------------------------------------------------------------------------
| Securities issuance | 4 | 2 | 4 | 3 |
--------------------------------------------------------------------------------
| Asset management and legal | 14 | 15 | 27 | 26 |
| services | | | | |
--------------------------------------------------------------------------------
| Insurance operations | 1 | 1 | 5 | 3 |
--------------------------------------------------------------------------------
| Guarantees | 2 | 1 | 3 | 3 |
--------------------------------------------------------------------------------
| Other | 3 | 1 | 4 | 2 |
--------------------------------------------------------------------------------
| Commission income, total | 38 | 31 | 73 | 62 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Commission expenses | | | | |
--------------------------------------------------------------------------------
| Payment transfers | 1 | 1 | 1 | 1 |
--------------------------------------------------------------------------------
| Securities brokerage | 2 | 2 | 5 | 4 |
--------------------------------------------------------------------------------
| Securities issuance | 2 | 0 | 3 | 1 |
--------------------------------------------------------------------------------
| Asset management and legal | 2 | 1 | 5 | 2 |
| services | | | | |
--------------------------------------------------------------------------------
| Other | 0 | 4 | 1 | 4 |
--------------------------------------------------------------------------------
| Total | 8 | 8 | 14 | 13 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net commissions and fees, | 31 | 23 | 59 | 48 |
| total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 5) Net trading income | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financial assets and | | | | |
| liabilities held for trading | | | | |
--------------------------------------------------------------------------------
| Capital gains and losses and | | | | |
| realised changes in value | | | | |
--------------------------------------------------------------------------------
| Notes and bonds | -9 | -4 | -10 | -8 |
--------------------------------------------------------------------------------
| Derivatives | 8 | 4 | 7 | 8 |
--------------------------------------------------------------------------------
| Unrealised changes in value | | | | |
--------------------------------------------------------------------------------
| Notes and bonds | -10 | -11 | -13 | -38 |
--------------------------------------------------------------------------------
| Shares and participations | 0 | -1 | 0 | 0 |
--------------------------------------------------------------------------------
| Derivatives | 11 | 12 | 20 | 37 |
--------------------------------------------------------------------------------
| Net income from foreign | 3 | 2 | 6 | 6 |
| exchange operations | | | | |
--------------------------------------------------------------------------------
| Net trading income, total | 3 | 2 | 10 | 5 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 6) Net investment income | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Available-for-sale financial | | | | |
| assets | | | | |
--------------------------------------------------------------------------------
| Capital gains and losses | | | | |
--------------------------------------------------------------------------------
| Shares and participations | 12 | 6 | 15 | 21 |
--------------------------------------------------------------------------------
| Dividend income | 1 | 3 | 6 | 8 |
--------------------------------------------------------------------------------
| Impairment losses | 0 | -1 | 0 | -1 |
--------------------------------------------------------------------------------
| Total | 12 | 8 | 22 | 28 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Investment properties | 0 | 1 | 1 | 1 |
--------------------------------------------------------------------------------
| Net investment income, total | 13 | 9 | 23 | 29 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 7) Other operating income | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Central bank service fee | 2 | 2 | 5 | 4 |
--------------------------------------------------------------------------------
| Realisation of repossessed | 0 | 0 | 1 | 1 |
| items | | | | |
--------------------------------------------------------------------------------
| Rental income from assets | -1 | 3 | -1 | 6 |
| rented under operating lease | | | | |
--------------------------------------------------------------------------------
| Other | 22 | 8 | 31 | 15 |
--------------------------------------------------------------------------------
| Total | 24 | 13 | 36 | 25 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 8) Personnel costs | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Salaries and fees | 37 | 36 | 71 | 70 |
--------------------------------------------------------------------------------
| Pension costs | 5 | 7 | 10 | 11 |
--------------------------------------------------------------------------------
| Other indirect personnel | 3 | 3 | 5 | 5 |
| costs | | | | |
--------------------------------------------------------------------------------
| Personnel costs, total | 45 | 45 | 86 | 87 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 9) Other administrative | | | | |
| expenses | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Office expenses | 15 | 12 | 30 | 23 |
--------------------------------------------------------------------------------
| IT expenses | 11 | 11 | 22 | 22 |
--------------------------------------------------------------------------------
| Telecommunications expenses | 3 | 3 | 5 | 6 |
--------------------------------------------------------------------------------
| Marketing expenses | 5 | 4 | 7 | 7 |
--------------------------------------------------------------------------------
| Other administrative expenses | 6 | 4 | 9 | 8 |
--------------------------------------------------------------------------------
| Other administrative | 39 | 34 | 73 | 66 |
| expenses, total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 10) Other operating expenses | | | | |
--------------------------------------------------------------------------------
| EUR million | Q2/07 | Q2/06 | H1/07 | H1/06 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Expenses from properties and | 7 | 6 | 12 | 12 |
| business premises in own use | | | | |
--------------------------------------------------------------------------------
| Expenses from realisation of | 0 | 1 | 1 | 1 |
| repossessed items | | | | |
--------------------------------------------------------------------------------
| Scheduled amortisation and | | | | |
| depreciation | | | | |
--------------------------------------------------------------------------------
| Amortisation on intangible | 9 | 9 | 18 | 18 |
| assets due to acquisition | | | | |
--------------------------------------------------------------------------------
| Other | 6 | 5 | 12 | 10 |
--------------------------------------------------------------------------------
| Other *) | 9 | 7 | 26 | 16 |
--------------------------------------------------------------------------------
| Other operating expenses, | 31 | 27 | 69 | 56 |
| total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| *) The item includes EUR 10 million in liquidated damages, with interest and |
| expenses, paid by OKO Bank to savings banks on the basis of an arbitral |
| award. The liquidated damages were due to the ceasing of cooperation between |
| Pohjola and savings banks in consequence of combining the operations of OP |
| Bank Group and Pohjola. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 11) Financial assets for | | | | |
| trading | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Notes and bonds | | | 3 567 | 4795 |
--------------------------------------------------------------------------------
| Shares and participations | | | 0 | 6 |
--------------------------------------------------------------------------------
| Total | | | 3 567 | 4801 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 12) Non-life Insurance assets | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Money market investments, | | | 20 | 22 |
| money market funds and | | | | |
| deposits | | | | |
--------------------------------------------------------------------------------
| Bonds and bond funds | | | 1 697 | 1 752 |
--------------------------------------------------------------------------------
| Shares and participations | | | 471 | 447 |
--------------------------------------------------------------------------------
| Alternative investments | | | 166 | 87 |
--------------------------------------------------------------------------------
| Properties | | | 69 | 56 |
--------------------------------------------------------------------------------
| Other | | | 509 | 400 |
--------------------------------------------------------------------------------
| Total | | | 2 932 | 2 766 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 13) Investment assets | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Available-for-sale financial | | | | |
| assets | | | | |
--------------------------------------------------------------------------------
| Notes and bonds | | | 95 | 94 |
--------------------------------------------------------------------------------
| Shares and participations | | | 74 | 101 |
--------------------------------------------------------------------------------
| Investment property | | | 26 | 29 |
--------------------------------------------------------------------------------
| Total | | | 194 | 225 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 14) Intangible assets | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Goodwill | | | 504 | 494 |
--------------------------------------------------------------------------------
| Brands | | | 179 | 179 |
--------------------------------------------------------------------------------
| Customer relations pertaining | | | 262 | 274 |
| to insurance contracts and | | | | |
| policy acquisition costs | | | | |
--------------------------------------------------------------------------------
| Other | | | 67 | 73 |
--------------------------------------------------------------------------------
| Total | | | 1 012 | 1 020 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 15) Non-life Insurance | | | | |
| liabilities | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Insurance contract | | | | |
| liabilities | | | | |
--------------------------------------------------------------------------------
| Provision for unearned | | | 467 | 285 |
| premiums | | | | |
--------------------------------------------------------------------------------
| Provision for unpaid claims | | | 1 705 | 1 683 |
--------------------------------------------------------------------------------
| Total | | | 2 172 | 1 969 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other | | | 183 | 130 |
--------------------------------------------------------------------------------
| Total | | | 2 355 | 2 099 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 16) Debt securities issued to | | | | |
| the public | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Bonds | | | 7 927 | 7 630 |
--------------------------------------------------------------------------------
| Certificates of deposit | | | 5 383 | 5 519 |
--------------------------------------------------------------------------------
| Other | | | 108 | 115 |
--------------------------------------------------------------------------------
| Total | | | 13 418 | 13 263 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 17) Subordinated liabilities | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Hybrid capital | | | 192 | 198 |
--------------------------------------------------------------------------------
| Other | | | 794 | 727 |
--------------------------------------------------------------------------------
| Total | | | 986 | 924 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Collateral given | | | | |
--------------------------------------------------------------------------------
| EUR million | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Given on behalf of own | | | 30 Jun | 30 Dec |
| liabilities and commitments | | | 2007 | 2006 |
--------------------------------------------------------------------------------
| Mortgages | | | 1 | 1 |
--------------------------------------------------------------------------------
| Pledges | | | 1192 | 2 520 |
--------------------------------------------------------------------------------
| Other | | | 47 | 31 |
--------------------------------------------------------------------------------
| Total collateral given | | | 1240 | 2 552 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Off-balance-sheet items | | | | |
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Guarantees | | | 534 | 534 |
--------------------------------------------------------------------------------
| Other guarantee liabilities | | | 1 476 | 1 384 |
--------------------------------------------------------------------------------
| Loan commitments | | | 3 254 | 3 563 |
--------------------------------------------------------------------------------
| Commitments related to | | | 141 | 165 |
| short-term sale events | | | | |
--------------------------------------------------------------------------------
| Other | | | 419 | 421 |
--------------------------------------------------------------------------------
| Off-balance-sheet items, | | | 5 823 | 6 066 |
| total | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Accounts receivable and payable from sale or purchase of assets on behalf of |
| customers |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | | | 30 Jun | 30 Dec |
| | | | 2007 | 2006 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Accounts receivable | | | 146 | 71 |
--------------------------------------------------------------------------------
| Accounts payable | | | 160 | 70 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Derivative | | | | | | |
| contracts | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Derivatives held for trading and | | | | |
| hedging on 30 June 2007 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | Nominal values/ | Total | Fair | |
| | remaining term to | | values | |
| | maturity | | | |
--------------------------------------------------------------------------------
| | <1v | 1-5v | >5v | | Assets | Liabili |
| | year | | | | | ties |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Interest rate | 43 163 | 24 644 | 9 673 | 77 480 | 459 | 410 |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Currency | 8 223 | 1 740 | 1 251 | 11 215 | 43 | 179 |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Equity and | 31 | 216 | 28 | 275 | 46 | 0 |
| index-linked | | | | | | |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Credit derivatives | | 131 | | 131 | 0 | 1 |
--------------------------------------------------------------------------------
| Other derivatives | 8 | 7 | | 15 | 1 | |
--------------------------------------------------------------------------------
| Total derivatives | 51 425 | 26 739 | 10 953 | 89 116 | 550 | 589 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Derivatives held for trading and | | | | |
| hedging on 30 June 2006 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EUR million | Nominal values/ | Total | Fair | |
| | remaining term to | | values | |
| | maturity | | | |
--------------------------------------------------------------------------------
| | <1v | 1-5v | >5v | | Assets | Liabili |
| | year | | | | | ties |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Interest rate | 31 981 | 15 872 | 4 384 | 52 237 | 203 | 176 |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Currency | 5 132 | 738 | 369 | 6 238 | 31 | 74 |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Equity and | 37 | 119 | | 156 | 20 | |
| index-linked | | | | | | |
| derivatives | | | | | | |
--------------------------------------------------------------------------------
| Credit derivatives | | 146 | 4 | 150 | 0 | 1 |
--------------------------------------------------------------------------------
| Other derivatives | 8 | 15 | | 22 | 1 | |
--------------------------------------------------------------------------------
| Total derivatives | 37 157 | 16 890 | 4 757 | 58 804 | 256 | 251 |
--------------------------------------------------------------------------------
Other contingent liabilities and commitments
On 30 June 2007, OKO Bank's commitments to venture capital funds amounted to EUR
10 million and Pohjola Non-Life's commitments to EUR 50 million. They are
included in the section 'Off-balance-sheet commitments'.
Related party transactions
The related parties of the OKO Bank Group comprise its parent, associates and
administrative personnel, as well as other related party companies. The parent
of the OKO Bank Group is Osuuspankkikeskus Osk (OP Bank Group Central
Cooperative).
On 30 June 2007, OKO Bank Group's associates were Autovahinkokeskus Oy and
Vahinkopalvelu Oy, and on 30 June 2006 Nooa Savings Bank Ltd, Autovahinkokeskus
Oy and Vahinkopalvelu Oy.
The administrative personnel of the OKO Bank Group includes the President and
CEO of OKO Bank, the deputy to the President and CEO, and the members and deputy
members of the Board of Directors and their close family members. Information on
the members of the Supervisory Board and their close family members was included
in the related party transactions until 30 March 2006, when the Supervisory
Board was abolished. Standard terms and conditions for credit are applied to
loans granted to the management. The loans are tied to generally applied
benchmark interest rates and the loans are repaid in accordance with the agreed
repayment schedule. The loans have normal collateral.
The other related party entities include OP Pension Fund, OP Pension Foundation
and sister companies in OP Bank Group Central Cooperative Consolidated.
--------------------------------------------------------------------------------
| Related party transactions | | | | |
| 30 June 2007 | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Parent | Consolida | Administra | Other |
| | company | ted | tive | |
| | | associate | personnel | |
| | | s | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Loans | 27 | | | 1 588 |
--------------------------------------------------------------------------------
| Other receivables | 85 | | | 71 |
--------------------------------------------------------------------------------
| Deposits | 3 | | | 118 |
--------------------------------------------------------------------------------
| Other liabilities | 6 | | | 44 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest income | 2 | | | 87 |
--------------------------------------------------------------------------------
| Interest expenses | 3 | | | 34 |
--------------------------------------------------------------------------------
| Dividend income | | | | 4 |
--------------------------------------------------------------------------------
| Commission income | 1 | | 0 | 14 |
--------------------------------------------------------------------------------
| Commission expenses | 1 | | 0 | 1 |
--------------------------------------------------------------------------------
| Trading income | | | | 1 |
--------------------------------------------------------------------------------
| Trading expenses | | | | 6 |
--------------------------------------------------------------------------------
| Other operating income | 4 | | | 6 |
--------------------------------------------------------------------------------
| Operating expenses | 29 | | | 1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Off-balance-sheet | | | | |
| commitments | | | | |
--------------------------------------------------------------------------------
| Guarantees | | | | 35 |
--------------------------------------------------------------------------------
| Irrevocable commitments | 8 | | | 102 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Wages and salaries and | | | | |
| performance-related pay | | | | |
--------------------------------------------------------------------------------
| Wages and salaries | | | 1 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Holdings of related parties | | | | |
--------------------------------------------------------------------------------
| Number of shares | 60 825 | | 67 778 | 4 220 946 |
| | 897 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Related party transactions | | | | |
| 30 June 2006 | | | | |
--------------------------------------------------------------------------------
| | | | | |
--------------------------------------------------------------------------------
| | Parent | Consolida | Administra | Other |
| | company | ted | tive | |
| | | associate | personnel | |
| | | s | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Loans | 50 | | | 1 408 |
--------------------------------------------------------------------------------
| Other receivables | 2 | | | 66 |
--------------------------------------------------------------------------------
| Deposits | 5 | | | 140 |
--------------------------------------------------------------------------------
| Other liabilities | 1 | | | 51 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest income | 1 | | | 22 |
--------------------------------------------------------------------------------
| Interest expenses | 2 | | | 5 |
--------------------------------------------------------------------------------
| Dividend income | | | | 3 |
--------------------------------------------------------------------------------
| Commission income from | | | | 9 |
--------------------------------------------------------------------------------
| Commission expenses | 1 | | | 1 |
--------------------------------------------------------------------------------
| Trading expenses | | | | 2 |
--------------------------------------------------------------------------------
| Other operating income | | | | 7 |
--------------------------------------------------------------------------------
| Operating expenses | 10 | | | 15 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Off-balance-sheet | | | | |
| commitments | | | | |
--------------------------------------------------------------------------------
| Guarantees | | | | 6 |
--------------------------------------------------------------------------------
| Irrevocable commitments | 8 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Wages and salaries and | | | | |
| performance-related pay | | | | |
--------------------------------------------------------------------------------
| Wages and salaries | | | 2 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Holdings of related parties | | | | |
--------------------------------------------------------------------------------
| Number of shares | 60 825 | | 49 728 | 4 205 946 |
| | 897 | | | |
--------------------------------------------------------------------------------
The Interim Report for 1 April to 30 June 2007 has been made according to IAS 34
(Interim Financial Reporting) as approved by the EU.
The accounting policies and the principles of segment reporting are described in
the 2006 financial statements.
The figures in this Interim Report are unaudited.
All figures in the Report have been expressed in round numbers. Consequently,
the sum of single figures may differ from the presented total sum.
Financial reporting in 2007
The Interim Report of OKO Bank Group for July-September will be disclosed on 8
November 2007.
Helsinki, 9 August 2007
OKO Bank plc
Board of Directors
(Translation)
Statement on the review of the OKO Bank interim report for the period 1 January
to 30 June 2007
To the Board of Directors of OKO Bank
We have performed a review of the OKO Bank interim report for the period 1
January to 30 June 2007. The interim report has been prepared by, and is the
responsibility of, the Board of Directors and the President, as defined under
chapter 2, section 5 of the Finnish Securities Markets Act. Based on our review,
and at the request of the Board of Directors, we issue our statement on the
interim report in line with chapter 2, section 5, subsection 7 of the Finnish
Securities Markets Act.
Our review was conducted in accordance with practice statement “910 Review”
issued by the Finnish Institute of Authorised Public Accountants. The review was
planned and conducted in order to obtain reasonable assurance about whether the
interim report is free of material misstatement. The review was limited in scope
and mainly consisted of enquiries of company personnel and analytical
procedures, and thus provides less assurance than an audit. We have not
performed an audit and, accordingly, we do not express an audit opinion.
Based on our review, nothing has come to our attention that would cause us to
believe that the interim report, in all material respects, would not have been
prepared in accordance with relevant rules and regulations, and that it would
not fairly present the result of operations and financial position of the OKO
Bank Group, as defined in the Finnish Securities Markets Act.
Helsinki, 9 August 2007
KPMG OY AB
Sixten Nyman Raimo Saarikivi
Authorised Public Accountant Authorised Public Accountant
This Interim Report is available on the Internet at www.oko.fi/english > Press.
Background information on the release can also be found at the same address.
Meeting for analysts
A meeting for analysts will be held in Finnish on 9 August 2007 at 10 am and an
English-language telephone conference later the same day at 3.30 pm. The
telephone conference number is +358 20 699121.
OKO Bank plc
Markku Koponen
Senior Vice President
DISTRIBUTION
OMX Nordic Exchange Helsinki
Major media
www.oko.fi
FOR MORE INFORMATION, please contact
Mr Mikael Silvennoinen, President and CEO, tel. +358 10 252 2549
Mr Ilkka Salonen, CFO, tel. +358 10 252 3146
Ms Marja Huhta, Senior Vice President, Head of IR, tel. +358 010 252 2037
© 2024 Nasdaq, Inc. All Rights Reserved |