Aktia Bank Plc’s Financial Statement Release January–December 2021: 2021 – a year of strong growth

Aktia Bank Plc

Stock Exchange Release

16 February 2022 at 8.00 a.m.

Aktia Bank Plc’s Financial Statement Release January–December 2021: 2021 – a year of strong growth

The quarter in short

• The growth in lending to companies continued to be strong, in terms of mortgages the growth was more moderate.
• Assets under management EUR 15.5 billion were approximately at the same level as in the previous quarter.
• The Common Equity Tier 1 capital ratio (CET1) 11.2% was somewhat higher than in the previous quarter (10.4%).
• The integration of Taaleri’s wealth management business progressed as planned, the company was merged with Aktia Bank at the year-end.
• Aktia became co-owner in Alexander Corporate Finance.
  
  
  
  

The year in short

• Comparable operating profit for the year, EUR 87.4 (55.1) million, was the highest in the history of Aktia.
• Comparable income increased by 31% during the year.
• Growth in all income categories, the acquisition of Taaleri’s wealth management operations supported the increase in commission income.
• Aktia to become a wealth manager bank ─ according to the strategy update in autumn, the focus is on close cooperation between business areas (banking, asset management, life insurance).

Outlook 2022

The comparable operating profit for 2022 is expected to be somewhat higher than in 2021 provided that the market development and circumstances in society remain stable.

Dividend

The Board of Directors proposes a dividend of EUR 0.56 per share.

Mikko Ayub, CEO:

Aktia did historically well in 2021. The comparable operating profit was EUR 87.4 (55.1) million and increased by 59% from the previous year. I am therefore very pleased with how Aktia did last year and proud of the valuable work that the Aktia employees have done in these exceptional circumstances. At the same time, it is worth bearing in mind that the reference period 2020 was burdened by the outbreak of the coronavirus pandemic and its impact on the market.

Aktia’s comparable operating income for 2021 increased 31% to EUR 263.2 (201.1) million. The development of the net interest income in the last quarter of the year and throughout the year was once again evenly strong and demonstrates the steady performance of Aktia's banking business in different market environments. Aktia's loan book increased by approximately 7% during the year, driven particularly by small and medium-sized companies. I therefore see a great deal of growth potential in Aktia's corporate business, supported by Aktia's recent 20% minority shareholding in the investment bank Alexander Corporate Finance. The demand for mortgage loans also remained strong throughout the year in line with our conservative lending policy.

Aktia's commission income also increased strongly from last year. The acquisition of Taaleri's wealth management business partly explains the increase from last year, but the commission income has increased also organically. The negative net subscriptions for the last quarter are associated with a change in the allocation of one institutional client. I am particularly pleased with the tremendous performance of Aktia Private Banking in the past year – good growth continued throughout the year, both in terms of income and customer volumes. Long-term development, high-quality asset management and a genuinely personalised service were also reflected in the results: In Prospera customer survey, Aktia Private Banking took an excellent second place.

Life insurance business has done well in the past year. The sales of both personal insurances and investment-linked insurances continued to be good. In November, Aktia Life Insurance Ltd also issued its first ever inaugural Tier 2 transaction (EUR 56 million), which strengthened its solvency.

Aktia's comparable expenses for the entire year amounted to EUR 171.1 (141.9) million and increased by approximately one fifth from last year. The main explanation for the increase in expenses is the normal operative cost structure that has increased as a result of the acquisition of Taaleri's wealth management business. On 31 December 2021, Aktia's CET1 capital ratio was 11.2% (10.4%; 30 Sept. 2021), which is clearly above the regulatory requirement imposed on Aktia and in line with the company's own financial objectives.

Aktia's Board of Directors proposes in line with our dividend policy that a dividend of EUR 0.56 per share be paid for 2021, which constitutes 60% of the profit for the reporting period. Traditionally, Aktia has been a reliable payer of dividends – now combined with a clear growth strategy.

The integration of Taaleri's wealth management business progressed as planned

The acquisition of Taaleri’s wealth management business last spring was not only the largest transaction in Aktia's history, but also a clear step towards our vision of being the leading wealth manager bank in Finland. The cooperation concerning alternative investment products between Aktia and Taaleri, which was brought about by the transaction, began at the end of the year with the mutual Asunto VIII private equity fund. The integration of business functions has been completed in many respects, although certain system integrations will continue throughout this year. The planned combinations of equity and fixed income funds were carried out before the merger of the fund management companies at the year-end. Aktia's portfolio management was also strengthened by several new recruits during the end of the year, and Aktia has one of Finland's largest and most versatile portfolio management teams.

The implementation of the strategy we updated this autumn has started smoothly: we have carried out many of Aktia's wealth plans for our customers through good cooperation between all business areas. Thus, we are in a good position when the new year starts.

Key figures

(EUR million)	Q4/2021	Q4/2020	∆ %	2021	2020	∆ %	Q3/2021	∆ %	Q2/2021	Q1/2021
Net interest income	24.1	20.8	16%	96.2	80.7	19%	23.1	4%	27.7	21.3
Net commission income	33.7	25.4	33%	124.0	97.6	27%	33.5	0%	31.7	25.0
Net income from life insurance	7.6	10.2	-26%	37.7	19.9	89%	9.7	-22%	10.5	9.9
Total operating income	65.5	57.0	15%	263.8	201.1	31%	67.1	-2%	73.3	57.9
Operating expenses	-45.2	-36.4	24%	-174.4	-142.2	23%	-41.6	-9%	-48.8	-38.7
Impairment of credits and other commitments	0.1	-0.8	-	-4.5	-4.0	11%	-1.0	-	-1.4	-2.2
Operating profit	20.3	19.7	3%	84.6	54.8	54%	24.4	-17%	23.0	16.9
Comparable operating income1	65.5	57.0	15%	263.2	201.1	31%	66.5	-1%	73.3	57.9
Comparable operating expenses1	-44.9	-36.3	24%	-171.1	-141.9	21%	-41.6	-8%	-45.9	-38.7
Comparable operating profit1	20.7	19.8	4%	87.4	55.1	59%	23.8	-13%	26.0	16.9
Cost-to-income ratio	0.69	0.64	8%	0.66	0.71	-7%	0.62	11%	0.67	0.67
Comparable cost-to-income ratio1	0.69	0.64	7%	0.65	0.71	-8%	0.63	10%	0.63	0.67
Earnings per share (EPS), EUR	0.23	0.22	5%	0.95	0.61	56%	0.28	-18%	0.24	0.20
Comparable earnings per share (EPS), EUR 1)1	0.23	0.22	8%	0.98	0.61	60%	0.27	-13%	0.28	0.20
Return on equity (ROE), %3	9.5	9.2	3%	10.0	6.7	50%	11.4	-17%	10.5	8.6
Comparable return on equity (ROE), %1,3	9.6	9.3	4%	10.3	6.7	54%	11.2	-14%	12.3	8.6
Common Equity Tier 1 capital ratio (CET1), %2	11.2	14.0	-20%	11.2	14.0	-20%	10.4	8%	10.8	13.8
Dividend per share (proposal from the Board of Directors), EUR				0.56	0.43	30%

1) Alternative performance measures excluding items affecting comparability

2) At the end of the period

3) The ROE definition has been updated

Webcast from the results conference

A live webcast from the results event will take place on 16 February 2022 at 10.30 a.m. CEO Mikko Ayub and CFO Outi Henriksson will present the results. The event is held in English and can be seen live at /2021-q4-results. A recording of the webcast will be available at after the event.

AKTIA BANK PLC

For more information:

Outi Henriksson, CFO, tel. +358 10 247 6236

Lotta Borgström, Director, Investor Relations and Communications, tel. +358 10 247 6838, lotta.borgstrom (at) aktia.fi

Distribution:

Nasdaq Helsinki Ltd

Central media

Aktia is a Finnish asset manager, bank and life insurer that has been creating wealth and wellbeing from one generation to the next for 200 years. We serve our customers in digital channels everywhere and face-to-face in our offices in the Helsinki, Turku, Tampere, Vaasa and Oulu regions. Our award-winning asset management business sells investment funds internationally. We employ approximately 900 people around Finland. Aktia's assets under management (AuM) on 31 December 2021 amounted to EUR 15.5 billion, and the balance sheet total was EUR 11.7 billion. Aktia's shares are listed on Nasdaq Helsinki Ltd (AKTIA). aktia.com.

 

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