Bank of Åland Plc: Year-end Report for the period January–December 2019
Bank of Åland Plc
Stock Exchange Release
February 7, 2020, 9.00 a.m.
Year-end Report for the period January–December 2019
“We ended our 100th financial year in a strong way and delivered our best net operating profit ever, EUR 33.2 M, which was 15 per cent higher than the preceding year (29.0). Return on equity after taxes (ROE) exceeded our long-term financial target, ending up at 10.7 per cent for the full year.
“During the fourth quarter, we saw a strong inflow of actively managed assets and healthy lending growth. This growth came primarily from new customers. Overall growth in actively managed assets during 2019 was 23 per cent and resulted in a new record year-end figure, EUR 6,343 M (5,177).
“Because of our positive trend, the Board of Directors expects net operating profit in 2020 to be better than in 2019. The Board is proposing an increased dividend of EUR 0.80 (0.70) per share, and an additional anniversary dividend of EUR 0.20 for our 100th financial year.”
Peter Wiklöf, Managing Director
January−December 2019 compared to January - December 2018
- Net operating profit increased by 15 per cent to EUR 33.2 M (29.0).
- Profit for the period attributable to shareholders rose by 15 per cent to EUR 26.3 M (22.9).
- Net interest income decreased by 1 per cent to EUR 53.9 M (54.5).
- Net commission income increased by 7 per cent to EUR 58.0 M (54.3).
- Total expenses were at an unchanged level and amounted to EUR 97.5 M (97.8).
- Net impairment losses on financial assets (including recoveries) totalled EUR 3.2 M (0.8), equivalent to a loan loss level of 0.08 (0.02) per cent.
- Return on equity after taxes (ROE) increased to 10.7 (9.8) per cent.
- Earnings per share increased by 14 per cent to EUR 1.69 (1.48).
- The common equity Tier 1 ratio amounted to 13.4 per cent (13.0).
- The Board of Directors proposes a regular dividend of EUR 0.80 (0.70) per share plus an anniversary dividend of EUR 0.20 per share.
- Future outlook: The Bank of Åland expects its net operating profit in 2020 to be better than in 2019.
The fourth quarter of 2019 compared to the fourth quarter of 2018
- Net operating profit increased by 18 per cent to EUR 9.1 M (7.7).
- Profit for the period attributable to shareholders rose by 16 per cent to EUR 7.2 M (6.2).
- Net interest income increased by 6 per cent to EUR 14.0 M (13.3).
- Net commission income increased by 17 per cent to EUR 16.3 M (13.9).
- Total expenses increased by 4 per cent to EUR 25.5 M (24.6).
- Net impairment losses on financial assets (including recoveries) totalled EUR 1.8 M (-0.1), equivalent to a loan loss level of 0.18 (0.00) per cent.
- Return on equity after taxes (ROE) increased to 11.4 (10.3) per cent.
- Earnings per share increased by 15 per cent to EUR 0.46 (0.40).
Financial summary
| Group | Q4 2019 | Q3 2019 | % | Q4 2018 | % | Jan-Dec 2019 | Jan-Dec 2018 | % |
| EUR M | ||||||||
| Income | ||||||||
| Net interest income | 14.0 | 13.3 | 5 | 13.3 | 6 | 53.9 | 54.5 | -1 |
| Net commission income | 16.3 | 13.8 | 18 | 13.9 | 17 | 58.0 | 54.3 | 7 |
| Net income from financial items at fair value | 1.1 | 1.6 | -33 | 0.2 | 3.9 | 1.5 | ||
| Other income | 5.0 | 4.2 | 21 | 4.9 | 4 | 18.1 | 17.4 | 4 |
| Total income | 36.4 | 32.9 | 11 | 32.3 | 13 | 133.9 | 127.6 | 5 |
| Staff costs | -14.6 | -13.4 | 9 | -14.3 | 2 | -57.0 | -57.1 | 0 |
| Other expences | -7.6 | -6.3 | 20 | -8.5 | -11 | -28.7 | -33.4 | -14 |
| Depreciation/amortisation | -3.3 | -2.9 | 17 | -1.8 | 84 | -11.8 | -7.3 | 62 |
| Total expenses | -25.5 | -22.5 | 13 | -24.6 | 4 | -97.5 | -97.8 | 0 |
| Profit before impairment losses | 10.9 | 10.4 | 5 | 7.7 | 43 | 36.4 | 29.8 | 22 |
| Impairment losses on financial assets, net | -1.8 | -0.8 | 0.1 | -3.2 | -0.8 | |||
| Net operating profit | 9.1 | 9.5 | -4 | 7.7 | 18 | 33.2 | 29.0 | 15 |
| Income taxes | -1.9 | -1.9 | -1 | -1.5 | 27 | -6.9 | -6.1 | 14 |
| Profit for the report period | 7.2 | 7.6 | -5 | 6.2 | 16 | 26.3 | 22.9 | 15 |
| Attributable to: | ||||||||
| Shareholders in Bank of Åland Plc | 7.2 | 7.6 | -5 | 6.2 | 16 | 26.3 | 22.9 | 15 |
| Volume | ||||||||
| Receivables from the public and public sector | 4 110 | 3 985 | 3 | 4 022 | 2 | |||
| Deposits from the public and public sector | 3 368 | 3 288 | 2 | 3 304 | 2 | |||
| Actively managed assets 1 | 6 343 | 5 788 | 10 | 5 177 | 23 | |||
| Equity capital | 258 | 247 | 5 | 242 | 7 | |||
| Balance sheet total | 5 607 | 5 555 | 1 | 5 558 | 1 | |||
| Risk exposure amount | 1 583 | 1 571 | 1 | 1 578 | 0 | |||
| Financial ratios | ||||||||
| Return on equity after taxes, % (ROE) 2 | 11.4 | 12.3 | 10.3 | 10.7 | 9.8 | |||
| Return on equity after taxes, % (ROE), moving 12-month avarage to end of report period | 10.7 | 10.5 | 9.8 | |||||
| Expence/income ratio 3 | 0.70 | 0.69 | 0.76 | 0.73 | 0.77 | |||
| Loan loss level, % 4 | 0.18 | 0.08 | 0.00 | 0.08 | 0.02 | |||
| Liquidity coverage ratio (LCR), % 5 | 139 | 163 | 120 | |||||
| Loan/deposit ratio, % 6 | 122 | 121 | 122 | |||||
| Core funding ratio, % 7 | 90 | 88 | 90 | |||||
| Equity/assets ratio, % 8 | 4.6 | 4.4 | 4.4 | |||||
| Common equtiy Tier 1 capital ratio, % 9 | 13.4 | 13.3 | 13.0 | |||||
| Earnings per share, EUR 10 | 0.46 | 0.49 | -5 | 0.40 | 15 | 1.69 | 1.48 | 14 |
| Earnings per share after dilution, EUR | 0.46 | 0.49 | -5 | 0.40 | 16 | 1.69 | 1.48 | 14 |
| Earnings per share, EUR, moving 12-month average to the end of report period | 1.69 | 1.63 | 4 | 1.48 | 14 | |||
| Equity capital per share, EUR 11 | 16.61 | 15.86 | 5 | 15.67 | 6 | |||
| Equity capital per share after dilution, EUR | 16.59 | 15.83 | 5 | 15.58 | 6 | |||
| Market price per Series A share, EUR | 17.00 | 14.70 | 16 | 13.30 | 28 | |||
| Market price per Series B share, EUR | 16.55 | 14.85 | 11 | 13.10 | 26 | |||
| Number of shares outstanding, 000s | 15 551 | 15 551 | 15 472 | 1 | ||||
| Number of shares outstanding, after dilution, 000s | 15 601 | 15 587 | 0 | 15 590 | 0 | |||
| Working hours re-calculated to full-time equivalent positions | 705 | 713 | -1 | 692 | 2 | 700 | 691 | 1 |
1 Actively managed assets encompassed managed assets in the Group’s own mutual funds, as well as discretionary and advisory securities volume
2 Profit for the report period attributable to shareholders / Average shareholders´portion of equity capital.
3 Expenses / Income.
4 Impaiment losses on loan portfolio and other commitments / Receivables from the public at the beginning of the period
5 Liquidity coverage ratio (LCR) = liquid assets, level 1 and 2 / 30-day net outflow 6 Receivables from the public / Deposits from the public
7 Receivables from the public / Deposits including certificates of deposit, index bonds and debentures issued to the public plus covered bonds issue
8 Equity capital / Balance sheet total.
9 (Common equity Tier 1 capital / Capital requirement) x 8%.
10 Shareholders’ portion of earnings for the period / Average number of shares.
11 Shareholders’ portion of equity capital / Number of shares less own shares on closing day.
The Bank of Åland (Ålandsbanken) follows the disclosure procedure stipulated in "Disclosure obligation of the issuer (7/2013)", published by the Finnish
Financial Supervisory Authority and hereby publishes its Year-end Report for the period January – december 2019, which is enclosed with this stock exchange
release. The Bank`s Year-end Report for the period January – december 2019 is attached to this release in PDF format and is also available on the company’s
web site at
/uploads/pdf/result/en_resultat_jan-dec_19.pdf
For more information please contact:
Peter Wiklöf, Managing Director and Chief Executive, Bank of Åland, tel. + 358 (0)40 512 7505
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