Aktia Bank Plc - Interim report January–March 2019
Aktia Bank Plc
Stock Exchange Release
May 3, 2019 at 8 a.m.
Aktia Bank Plc - Interim report January–March 2019
Stable first quarter - increase in operating income
Mikko Ayub, CEO:
I am pleased with the development of Aktia’s underlying operations during the first quarter of the year. The operating income of the first quarter was 3% higher compared to the corresponding period last year. Although the market downswing at the end of the year now has recovered to its earlier level, its effects through managed customer assets were still partly visible in the commission income. The net interest income amounted to EUR 19.4 (20.7) million, although the income from the 2012 unwound interest rate hedges was approximately EUR 2 million lower than during the reference period. In addition, the tough competition is still putting pressure on loan margins. The positive development of the net income from life insurance is mainly explained by the positive value changes in the investment portfolio. The costs were somewhat higher than last year due to IT and digital projects at the beginning of the year, as well as the estimated cost of EUR 2 million for the stability fee which this year has been booked in its entirety to the first quarter.
Although Aktia’s first quarter as a whole was on a good level, we cannot afford to be too satisfied. The low interest rate environment is still burdening the banking sector and according to prognoses the economic growth in Finland will diminish during the following years. The implementation of our strategy is going forward within the framework of new plans of action. The focus of these plans is to develop Aktia’s corporate culture to better serve our goals, to intensify our operations, to work on a new customer experience by offering our customers even more individual and versatile services and to sharpen our sales processes. Our goal is to be an even more efficient and profitable bank and our determined work to develop Aktia continues.
January–March 2019:
- The total operating income increased by 3% to EUR 52.7 (51.2) million, of which the net interest income amounted to EUR 19.4 (20.7) million, the net commission income to EUR 22.7 (23.8) million and the net income from life insurance to EUR 8.3 (5.8) million.
- Operating expenses excluding items affecting comparability increased by 9% to EUR 36.1 (33.1) million. Total operating expenses increased to EUR 36.1 (33.5) million.
- The comparable operating profit amounted to EUR 17.2 (18.0) million, a decrease by 5%. The reported operating profit amounted to EUR 17.2 (17.7) million.
Outlook 2019 (unchanged):
- Despite the uncertainty of the economic development, the comparable operating profit 2019 is expected to be approximately on the same level as for 2018.
Key figures
| (EUR million) | 1Q2019 | 1Q2018 | ∆ % | 2018 | 4Q2018 | ∆ % | 3Q2018 | 2Q2018 |
| Net interest income | 19.4 | 20.7 | -6% | 85.9 | 20.7 | -6% | 21.0 | 23.5 |
| Net commission income | 22.7 | 23.8 | -5% | 95.6 | 22.6 | 0% | 22.9 | 26.2 |
| Net income from life insurance | 8.3 | 5.8 | 43% | 21.4 | 5.1 | 62% | 5.5 | 5.0 |
| Other operating income | 2.3 | 0.8 | 169% | 7.3 | -0.7 | - | 6.0 | 1.1 |
| Total operating income | 52.7 | 51.2 | 3% | 210.1 | 47.7 | 10% | 55.4 | 55.8 |
| Total operating expenses | -36.1 | -33.5 | 8% | -143.0 | -39.4 | -8% | -31.8 | -38.3 |
| Impairment of credits and other commitments | -1.1 | -0.6 | 80% | -0.8 | -0.1 | 707% | -0.8 | 0.7 |
| Operating profit | 17.2 | 17.7 | -3% | 67.6 | 8.0 | 113% | 23.7 | 18.2 |
| Comparable operating profit1 | 17.2 | 18.0 | -5% | 65.4 | 10.2 | 68% | 18.6 | 18.5 |
| Cost-to-income ratio | 0.69 | 0.65 | 6% | 0.68 | 0.83 | -17% | 0.57 | 0.69 |
| Comparable cost-to-income ratio1 | 0.69 | 0.65 | 6% | 0.69 | 0.79 | -13% | 0.63 | 0.68 |
| Earnings per share (EPS), EUR | 0.21 | 0.22 | -7% | 0.81 | 0.09 | 128% | 0.29 | 0.21 |
| Comparable earnings per share (EPS), EUR | 0.21 | 0.22 | -5% | 0.77 | 0.12 | 75% | 0.23 | 0.22 |
| Return on equity (ROE), % | 9.4 | 10.2 | -7% | 9.4 | 4.4 | 116% | 13.7 | 10.1 |
| Common Equity Tier 1 capital ratio (CET1), %2 | 16.9 | 16.4 | 3% | 17.5 | 17.5 | -3% | 16.6 | 16.3 |
1) Alternative performance measures excluding items affecting comparability
2) At the end of the period
Webcast from the results conference
A live webcast from the results conference will take place today on 3 May 2019 at 10 a.m. CEO Mikko Ayub and CFO Outi Henriksson will present the result.
The conference is held in Finnish and Swedish and can be seen live at https://aktia.videosync.fi/2019-q1-results. A recording of the webcast will be available at www.aktia.com.
AKTIA BANK PLC
For more information:
Outi Henriksson, CFO, tel. +358 10 247 6236
Lotta Borgström, Head of Investor Relations, tel. +358 10 247 6838, ir (at) aktia.fi
Distribution:
Nasdaq Helsinki Ltd
Central media
www.aktia.com
Aktia provides a broad range of solutions within banking, asset management and personal insurance. Aktia operates in coastal areas and inland growth areas. Aktia has approximately 370,000 customers who are served at branch offices and online, through mobile interfaces as well as through telephone services. Aktia's share is listed on the list of Nasdaq Helsinki Ltd. For more information about Aktia, see www.aktia.com
