Pohjola Pankki Oyj - Financial Statement Release

Pohjola Bank plc Financial Statements Bulletin for 1 January-31 December 2015

Pohjola Bank plc
Stock Exchange Release, 4 February 2016 at 09.00 am EET
Financial Statements Bulletin for January 1-31 December 2015


Pohjola Bank plc Financial Statements Bulletin for 1 January-31 December 2015

  * Consolidated earnings before tax were EUR 652 million (584) and consolidated
    earnings before tax at fair value amounted to EUR 511 million (663). The
    return on equity was 14.8% (14.3).
  * The Common Equity Tier 1 (CET1) ratio was 14.1% (12.4) as against the target
    of 15%.
  * Earnings reported by Banking improved by 10% to EUR 334 million (303). The
    loan portfolio grew in the year to December by 10% to EUR 16.4 billion
    (14.9). Earnings included EUR 29 million (25) in impairment loss on
    receivables.
  * Non-life Insurance earnings rose by 19% to EUR 267 million (223). Operating
    combined ratio was 87.3 (89.4). Return on investments at fair value was
    2.3% (6.7).
  * Other Operations earnings improved by 14% to EUR 23 million (20). Liquidity
    and access to funding remained good.
  * Wealth Management earnings amounted to EUR 28 million (38). Assets under
    management increased in the year to December by 9%, totalling EUR 47 billion
    (43).
  * In the partial demerger of Pohjola Bank plc, wealth management, card and
    property management operations presented as discontinued operations were
    transferred to OP Cooperative on 30 December 2015.
  * Outlook for 2016: Consolidated earnings before tax for 2016 are expected to
    be lower than earnings from continuing operations in 2015. For more detailed
    information on the outlook, see "Outlook for 2016" below.

 Earnings before tax, € million    Q1-4/2015 Q1-4/2014 Change, %
----------------------------------------------------------------
   Banking                               334       303        10

   Non-life Insurance                    267       223        19

   Other Operations                       23        20        14

   Wealth Management                      28        38       -26

 Group total                             652       584        12

 Change in fair value reserve           -141        79

 Earnings before tax at fair value       511       663       -23



 Equity per share, €                   11.38     10.38

 Average personnel                     2,446     2,563
----------------------------------------------------------------
The above figures describe Pohjola Group as a whole without the division into
continuing and discontinued operations.
Comparatives deriving from the income statement are based on figures reported
for the corresponding period a year ago. Unless otherwise specified, balance-
sheet and other cross-sectional figures on 31 December 2014 are used as
comparatives.

 Financial targets                                Q1-4/2015 Q1-4/2014    Target
-------------------------------------------------------------------------------
 Return on equity, %                                   14.8      14.3        13

 Common Equity Tier 1 (CET1) ratio, % *                14.1      12.4        15

 Operating cost/income ratio by Banking, %               27        33      < 35

 Operating combined ratio by Non-life Insurance,
 % **                                                  87.3      89.4      < 92

 Operating expense ratio by Non-life Insurance, %      17.7      18.4        18

 Non-life Insurance solvency ratio (under
 Solvency II framework), % ***                        139.3     117.3       120

 Operating cost/income ratio by Wealth
 Management, %                                           58        42      < 45

 Total expenses in 2015 at the same level as at
 the end of 2012                                       491        531   514****

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

 Dividend payout ratio at least 50%, provided
 that CET 1 ratio is at least 15%. Dividend
 payout ratio is 30% until CET1 ratio of 15% has
 been achieved.                                     30*****        30 > 50 (30)
-------------------------------------------------------------------------------

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

Outlook for 2016

The world economy is expected to grow at a rate below the average. Economic
growth in the euro area is anticipated to remain moderate. Finnish economic
growth has been modest for a long time now. Weak export demand, eroding price
competitiveness and slow reform of economic structures are threatening to make
the Finnish economic growth rate clearly lag behind the euro area for several
years. Implementing the structural reforms may tighten the political situation,
which may, for its part, threaten the recovery of the domestic market. The
current exceptional world economic situation with low interest rates and
quantitative easing measures by central banks will also cause major uncertainty
to the future economic development.

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

Pohjola Group's consolidated earnings before tax in 2016 are expected to be
lower than earnings from continuing operations before tax in 2015. The most
significant uncertainties affecting earnings in 2016 relate to the rate of
business growth, impairment loss on receivables, developments in bond and
capital markets, the effect of large claims on claims expenditure and to the
discount rate applied to insurance liabilities.

All forward-looking statements in this report expressing the management's
expectations, beliefs, estimates, forecasts, projections and assumptions are
based on the current view of the future development in the operating environment
and the future financial performance of Pohjola Group and its various functions,
and actual results may differ materially from those expressed in the forward-
looking statements.


Helsinki, 4 February 2016

Pohjola Bank plc
Board of Directors

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

Financial reporting in 2016

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

Schedule for Interim Reports in 2016:

Interim Report Q1/2016                               27 April 2016
Interim Report H1/2016                               3 August 2016
Interim Report Q1-3/2016                            2 November 2016


DISTRIBUTION


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

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


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


www.pohjola.com


[HUG#1983592]

Attachments:

Pohjola Bank plc s Financial Statements Bulletin 2015.pdf