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Aktia Bank Plc�s Interim Report January�March 2022: The market uncertainty decreased the comparable operating profit

Aktia Bank Plc
Stock Exchange Release
11 May 2022 at 8.00 a.m.

Aktia Bank Plc�s Interim Report January�March 2022: The market uncertainty decreased the comparable operating profit��

The quarter in short

  • The solid underlying business performance continued.
  • The net interest income continued to increase with the support of the strong corporate customer business.
  • The uncertain market was reflected in the prudence of private customers� drawdowns, and the sales of interest rate hedges clearly increased.
  • The negative unrealised value changes in the life insurance company's investment portfolio weighed down the net income from life insurance as a result of the impact of the rapid increase in interest rates and the market drop caused by Russia�s war of aggression.�

Outlook 2022 (unchanged)

The comparable operating profit in 2022 is expected to be somewhat higher than in 2021 provided that the market development is favourable and the circumstances in society remain stable. Aktia Group's result for 2022 depends on the impact of the uncertainty caused by Russia�s war of aggression on the market.

  • The net interest income growth is expected to remain strong, especially in the corporate customer segment, due to the active pricing and expected volume growth. The financing expenses are expected to increase slightly as interest rates increase.
  • The growth in commission income is expected to continue. The growth is supported by the completion of the integration of Taaleri�s wealth management business.
  • The development of the net income from life insurance is dependent on changes in the market values. As a result of increasing interest rates and market uncertainty, negative unrealised value changes were recorded during the first quarter of the year, but positive value changes from the real estate portfolio are expected for the remainder of the year. The actuarially calculated result is expected to improve compared to last year.
  • Considering the impact of inflation, the expenses are expected to be approximately at the level of comparable operating expenses in 2021.
  • Potential credit loss provisions are expected to remain at a moderate level while the liquidity and capital adequacy of Aktia remain stable.


In accordance with the proposal by the Board of Directors, Aktia Bank Plc's Annual General Meeting 2022 decided on the payment of a dividend of 0.56 euro per share for the accounting period 1 January � 31 December 2021. The dividend was paid out on 19 April 2022.

Mikko Ayub, CEO:

I am sure we all expected a more normal year after two years of the coronavirus pandemic, but the expectations changed very soon in the beginning of the year. The Russian war of aggression against Ukraine and the human suffering of civilians on the battlefield have shocked us all. The need for humanitarian aid in Ukraine has increased as the fighting has expanded, and Aktia, together with its personnel, has supported UNICEF's valuable work for the children of Ukraine through a donation.

The war will also have an extensive impact on the economy and society, and the consequences will certainly be visible far into the future. In these times, the reliable banking sector, and Aktia as a part of it, is an important part of the well-functioning society and the economic system. Aktia is a stable and conservative wealth manager bank operating in Finland and has no operations in Russia, Belarus or Ukraine. However, the rising inflation and rising energy and raw material prices are consequences whose negative effects on the Finnish economy are evident.

So far, the effects of the war on Aktia's business have been moderate. For our part, we are following all the sanctions imposed on Russia. In March, we decided to suspend all outgoing and incoming payments to and from Russia and Belarus for the time being. The decision was based on Aktia's own risk assessment. There are also not any significant direct risks in relation to the crisis area in our credit portfolio. In wealth management, the risks are equally manageable � Aktia's own funds do not contain any direct investments in Russia, and Aktia has stopped the new sales of other actors' funds mainly investing in Russia.

The market decline decreased the comparable operating profit

Aktia�s comparable operating profit in the first quarter of 2022 was EUR 13.3 million, which was lower than the comparable operating profit in the reference period last year of EUR 16.9 million. The main reason for the decline in the profit development was the weakened operating environment: Even before the war in Ukraine, the market outlook was overshadowed by inflation concerns and expectations of increased interest rates. The market decline following Russia's attack and the impact of the rapid increase in interest rates on the fixed income investments led to negative unrealised value changes in the life insurance company's investment portfolio, which weighed down the net income from life insurance to EUR 1.8 (Q1/2021; 9.9) million in the first quarter of the year. The life insurance business itself, however, continued its positive development � the premiums written increased by 18% since last year, and the sales of investment-linked savings insurances and risk insurances continued to be strong.

In other income categories, the good development continued despite the uncertain operating environment, and the comparable income amounted to EUR 58.8 (57.9) million. The net interest income amounted to EUR 25.1 (21.3) million, thus clearly increasing in relation to the reference period. The strong growth was again mainly due to the excellent development in the corporate customer business. The good demand also shows that companies want to secure their own funding and liquidity in the uncertain situation. Our customers have also welcomed our improved offering. They have been especially happy with the offering in relation to investment funding. The exceptional situation in the private customer business has been reflected in caution among the customers. According to our strategy, we are not aiming for growth in our market share, but, in line with our conservative lending policy, we are aiming for growth in the customer segments that are important to us � customers who want to increase their wealth. The sales of interest rate hedges clearly increased during the beginning of the year.

The net commission income in the first quarter amounted to EUR 31.3 (25.0) million, which, considering the nervous market environment, is only a moderate decline from Q4/2021 of EUR 33.7 million and mainly the result of a decline in market values. The assets under management decreased by around EUR 1 billion from the turn of the year and amounted to EUR 14.4 billion at the end of the quarter. The market values decreased by approximately EUR 840 million, and the net subscriptions amounted to approximately EUR -210 million, which was largely due to the redemptions of international institutional investors from our emerging market (EMD) funds. However, the continued excellent relative return development of Aktia�s EMD funds creates good conditions for the assets to return as the market situation improves. The sales in Aktia�s Private Banking also continued to develop well.

The comparative expenses of the quarter remained at the same level as at the turn of the year, reaching EUR 45.9 million (Q4 2021; 44.9), which is a good level when taking into consideration that we made a reservation of EUR 4.6 million in the first quarter for the stability fee from the Financial Stability Authority. Last year's corresponding figure in the first quarter was EUR 2.8 million. The staff expenses were below the level of the third and forth quarter last year, and the credit loss provisions were very moderate.

Key figures

(EUR million) 1Q/2022 1Q/2021 ? % 2021 4Q/2021 ? % 3Q/2021 2Q/2021
Net interest income 25.1 21.3 18% 96.2 24.1 4% 23.1 27.7
Net commission income 31.3 25.0 25% 124.0 33.7 -7% 33.5 31.7
Net income from life insurance 1.8 9.9 -82% 37.7 7.6 -76% 9.7 10.5
Total operating income 59.0 57.9 2% 263.8 65.5 -10% 67.1 73.3
Operating expenses -45.9 -38.7 19% -174.4 -45.2 -2% -41.6 -48.8
Impairment of credits and other commitments 0.3 -2.2 - -4.5 0.1 141% -1.0 -1.4
Operating profit 13.5 16.9 -20% 84.6 20.3 -33% 24.4 23.0
Comparable operating income1 58.8 57.9 2% 263.2 65.5 -10% 66.5 73.3
Comparable operating expenses1 -45.9 -38.7 19% -171.1 -44.9 -2% -41.6 -45.9
Comparable operating profit1 13.3 16.9 -21% 87.4 20.7 -35% 23.8 26.0
Cost-to-income ratio 0.78 0.67 16% 0.66 0.69 13% 0.62 0.67
Comparable cost-to-income ratio1 0.78 0.67 16% 0.65 0.69 14% 0.63 0.63
Earnings per share (EPS), EUR 0.15 0.20 -26% 0.95 0.23 -34% 0.28 0.24
Comparable earnings per share (EPS), EUR1 0.15 0.20 -25% 0.98 0.23 -36% 0.27 0.28
Return on equity (ROE), % 6.5 8.6 -24% 10.0 9.5 -31% 11.4 10.5
Comparable return on equity (ROE), %1 6.5 8.6 -25% 10.3 9.6 -33% 11.2 12.3
Common Equity Tier 1 capital ratio (CET1), %2 10.6 13.8 -23% 11.2 11.2 -5% 10.4 10.8

1) Alternative performance measures
2) At the end of the period

Webcast from the results conference

A live webcast from the results event will take place on 11 May 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 https://aktia.videosync.fi/2022-q1-results. A recording of the webcast will be available at www.aktia.com after the event.


For more information:
Outi Henriksson, CFO, tel. +358 10�247 6236
Lotta Borgstr�m, Director, Investor Relations and Communications, tel. +358 10�247 6838, lotta.borgstrom (at) aktia.fi

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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