OKO Pankki Oyj - Company Announcement

OKO Bank Group's Updated Strategy and Financial Targets

OKO Bank Group's Updated Strategy and Financial Targets                         

At its meeting held today, OKO Bank plc's Board of Directors decided on strategy
updates. OKO Bank Group (Pohjola Bank Group as of 1 March 2008) will continue to
place a strong emphasis on profitability and efficient capital management. The  
Group seeks growth in all of its business areas, but not at the expense of      
profitability.                                                                  

Key strategy updates are as follows:                                            
- Ever-intensified business integration                                         
- Higher target for return on equity                                            
- Stricter target for operating combined ratio                                  
- Higher return on capital                                                      
- Stronger market position                                                      


OKO Bank's integrated operating model forms the core of its business concept,   
the related cornerstones including Pohjola's and OP-Pohjola Group's strong      
brands, extensive service network and customer base, high return on capital,    
proactive risk management as well as people and competencies.                   

Key strategy implementation areas are as follows:                               

1) Exploiting the business areas' shared customer potential and service network 
                                                                                
A variety of fields involve growth potential. In 2008, the Group will update its
service concept for large customers in such a way that responsibility for       
customer relationships within both banking and insurance services will be       
managed under the same roof. The Group will also adopt a similar business model 
with respect to its service concept for large car dealership chains.            

Cooperation in non-life insurance with OP-Pohjola Group's member cooperative    
banks has begun extremely smoothly, as evidenced by vigorous growth in the      
number of new loyal customer households in 2006 and 2007.                       

With the progress made in information system development, OKO's businesses will 
make use of more extensive shared databanks with a view to improving customer   
service and creating a more efficient risk-based premium rating system.         

2) New value-adding services                                                    

OKO's competitive advantage over most of its competitors lies in its ability and
opportunity to provide a package of banking and insurance services on a one-stop
shop basis. The opportunity of OP bonus customers to utilise bonuses they have  
earned from their banking transactions in paying Pohjola insurance premiums     
serves as an example of a new customer service model launched in November.      

3) International service capacity                                               

In the next few years, OKO will place a heavier emphasis on its international   
service offering according to customer needs. In both banking and insurance     
services, the development of international services will be based on carefully  
considered partnerships, without ruling out company acquisitions. In the next   
few years, OKO aims to continue to expand and develop its Baltic operations in  
the field of Banking and Non-life Insurance. In addition, it will analyse       
business potential in Russia.                                                   

Aiming at stronger market position                                              

Banking and Investment Services and Non-life Insurance constitute the Group's   
lines of business.                                                              

Banking and Investment Services has the strategic goal of becoming the market   
leader as a bank for large and medium-sized corporate customers in Finland (as  
compared with the previous aim of strengthening its second place in the market) 
and, together with the rest of OP-Pohjola Group, the market leader as a bank for
SMEs. Asset Management aims at the leading market position in Finland.          

Non-life Insurance aims to continue increasing its market share and rise to     
number one in Finland from its current second place, underpinned by close       
cooperation with OP-Pohjola Group member banks and the new loyalty customer     
scheme. Non-life Insurance will seek growth through risk-based premium rating,  
which will safeguard profitable operations.                                     

Change in capital adequacy calculation methods                                  

From 1 January 2008, OKO will calculate its capital adequacy in compliance with 
a new capital adequacy regime reflected in the calculation of own funds and     
their minimum requirements. Moreover, OKO's own funds will be calculated by     
deducting the total carrying amount of insurance company investment from its own
funds, half from Tier 1 and half from Tier 2. Currently, goodwill arising from  
insurance company investment and intangible assets are deducted from Tier 1 and 
the insurance company's minimum solvency margin is deducted from total own      
funds.                                                                          

As a result of the adoption of the new capital adequacy calculation method, Tier
1 will increase by EUR 170 million, improving the Tier 1 capital adequacy ratio 
by 1.5 percentage points, while total own funds will diminish by EUR            
200 million, lowering total capital adequacy by 1.3 percentage points.          

The minimum regulatory capital requirements (Pillar 1) for credit risk will be  
calculated using the Standardised Approach (SA) from 1 January 2008. In the     
credit risk calculation, OKO aims to phase in the Internal Ratings-based        
Approach (IRBA) in such a way that the capital adequacy requirement for the     
first exposure classes, such as corporate exposure, will be calculated using    
IRBA from the second half of 2008. From 1 January 2008, the capital adequacy    
requirement for operational risks will be calculated using the Basic Indicator  
Approach (BIA) and that for market risks using SA.                              

The adoption of IRBA for credit risk and OP-Pohjola Group's zero-risk weight of 
internal items are expected to lower the minimum requirement for owns funds from
their current levels. Due to transitional provisions, the minimum requirement   
for own funds may decrease by a maximum of 10% in 2008 and by a maximum of 20%  
in 2009 in comparison with the current method.                                  

Change in criteria for loyal customer households                                

The Board of Directors has decided to respecify the definition of the loyal     
customer household to better support the development of the present business.   
Before OKO acquired Pohjola, the latter's service range covered life insurance  
and mutual fund products, in addition to non-life insurance products, and these 
were previously taken into account when defining loyal customer households.     
Excluding these products from the current definition, loyal customer households 
are now defined as households who have taken out Pohjola policies within at     
least three non-life insurance product lines. Although this change decreased the
number of loyal customer households by 45,000 to 347,000 (30 September 2007),   
the average annual premiums written per loyal customer household rose to over   
EUR 700. Similarly, the target set for the number of loyal customers has        
changed, i.e. OKO aims to increase the number of loyal customer households from 
the current 347,000 to 450,000 (500,000 based on the previous definition) by the
end of 2010.                                                                    

OKO Group's financial targets by 2010                                           

When confirming the updated strategy, the Board of Directors also respecified   
OKO Group's financial targets. By the end of 2010, the Group aims to record a   
15% return on equity (ROE) at fair value (previously 13% by 2009).              

It seeks to maintain the ratio of Tier 1 to risk-weighted commitments at a      
minimum of 8.5% (previously a minimum of 8.0%, corresponding to around 9.5%     
based on the new calculation method for own funds). The adoption of the new     
capital adequacy rules, profitable business growth and a decrease in intangible 
assets, generated by the Pohjola acquisition, through amortisation will enable  
the Group to make more efficient use of capital.                                

The Group has the aim of maintaining its current strong credit ratings within   
Banking and Insurance.                                                          

Group profitability, growth and capitalisation needs will determine the annual  
dividend distribution. OKO aims to distribute at least 50% of its earnings per  
share in dividends, provided that the Tier 1 ratio stands at a minimum of 8.5%. 

In segment reporting, capitalisation by business line is as follows:            

Banking and Investment Services capitalisation accounts for 7% of risk-weighted 
commitments plus intangible assets and goodwill arising from the acquisition of 
Pohjola Asset Management Ltd.                                                   

Non-life Insurance capitalisation equals a 70% solvency ratio plus intangible   
assets and goodwill arising from the acquisition of Pohjola's non-life insurance
operations.                                                                     

Performance targets for business lines by 2010                                  

Banking and Investment Services aims to report an operating return on equity    
(ROE) of at least 19% (previously at least 18%) and an operating cost/income    
ratio of less than 40% (previously 40%).                                        

Non-life Insurance aims to record an operating return on equity of at least 20% 
and an operating combined ratio of 92% (previously less than 94%). An operating 
expense ratio of less than 20% is a new financial target set for Non-life       
Insurance.                                                                      

The operating ROE is calculated on earnings before amortisation on intangible   
assets arising from the Pohjola acquisition.                                    

On 30 November 2007, OKO Bank will hold a Capital Market Meeting for analysts   
and institutional investors in London at noon local time and in Helsinki at 2.00
pm local, and publish the related presentation material, containing more        
detailed information on OKO's strategy, on its website at www.oko.fi > Equity   
investors on the same date.                                                     
                                                                                

OKO Bank plc                                                                    

Mr Markku Koponen                                                               
Senior Vice President                                                           

DISTRIBUTION                                                                    
OMX Nordic Exchange Helsinki                                                    
Major media                                                                     
London Stock Exchange                                                           
SWX Swiss Exchange                                                              
www.oko.fi                                                                      


FOR MORE INFORMATION, PLEASE CONTACT:                                           
Mr Mikael Silvennoinen, President and CEO, tel. +358 (0)10 252 2549             
Mr Ilkka Salonen, CFO, tel. 010 252 3146                                        
Ms Marja Huhta, Senior Vice President, Investor Relations, tel. +358 (0)10 252  
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