February 23, 2024
Finance

OP Corporate Bank plc’s Financial Statements Bulletin 1 January–31 December 2023


OP Corporate Bank plc

OP Corporate Bank plc

OP Corporate Bank plc
Financial Statements Bulletin 1 January–31 December 2023
Stock Exchange Release 7 February 2024 at 9.00 am EET

OP Corporate Bank plc’s Financial Statements Bulletin 1 January–31 December 2023

  • OP Corporate Bank plc’s operating profit increased to EUR 329 million (265).

  • Net interest income increased by 47% to EUR 582 million (396) and net commissions and fees by EU 54 million to EUR 73 million (19). Investment income fell by 56% to EUR 52 million (117).

  • Impairment loss on receivables increased by EUR 77 million to EUR 96 million (18). Expected credit losses increased especially in respect of receivables concerning construction and property investment.

  • Operating expenses increased by 11% to EUR 313 million (281). The cost/income ratio improved to 42% (50).

  • In the year to December, the loan portfolio decreased by 0.8% to EUR 28.1 billion (28.3) and the deposit portfolio by 0.4% to EUR 14.6 billion (14.7).

  • The Corporate Banking and Capital Markets segment’s operating profit increased to EUR 198 million (186). Net interest income grew by 40% to EUR 316 million (225). Investment income fell by 62% to EUR 49 million (130). Net commissions and fees totalled EUR 3 million (–49). Operating expenses increased by 4% to EUR 131 million (126). Impairment loss on receivables increased to EUR 44 million (1).

  • The Asset and Sales Finance Services and Payment Transfers segment’s operating profit decreased to EUR 126 million (138). Net interest income grew by 13% to EUR 207 million (183). Net commissions and fees totalled EUR 64 million (63). Operating expenses increased by 16% to EUR 122 million (105). Impairment loss on receivables increased to EUR 37 million (12).

  • The Baltics segment’s operating profit rose to EUR 27 million (24). Net interest income grew by 36% to EUR 67 million (49). Net commissions and fees, EUR 10 million, were at the previous year’s level. Operating expenses increased by 19% to EUR 35 million (29). Impairment loss on receivables increased to EUR 15 million (6).

  • The Group Functions segment’s operating loss was EUR 22 million (–83). Financial position and liquidity remained strong.

  • OP Corporate Bank plc’s CET1 ratio was 13.0% (11.9), which exceeds the minimum regulatory requirement by 4.3 percentage points. OP Corporate Bank adopted the Standardised Approach to credit risk in its capital adequacy measurement during the first quarter.

OP Corporate Bank plc’s key indicators

Operating profit (loss), € million

Q1–4/2023

Q1–4/2022

Change, %

Corporate Banking and Capital Markets

198

186

6.5

Asset and Sales Finance Services and Payment Transfers

126

138

-9.2

Baltics

27

24

13.3

Group Functions

-22

-83

Total

329

265

24.1

Total income

738

564

30.7

Total expenses

-313

-281

11.3

Cost/income ratio, %

42.4

49.8

-7.4*

Return on equity (ROE), %

5.9

4.9

1.0*

Return on assets (ROA), %

0.30

0.22

0.08*

 

31 Dec 2023

31 Dec 2022

Change, %

CET1 ratio, %

13.0

11.9

1.1*

Loan portfolio, € million**

28,076

28,309

-0.8

Guarantee portfolio, € million

3,184

3,412

-6.7

Other exposures, € million

5,745

6,354

-9.6

Deposits, € million

14,629

14,683

-0.4

Ratio of non-performing exposures to exposures, %**

2.2

1.5

0.7*

Ratio of impairment loss on receivables to loan and guarantee portfolio, %**

0.31

0.06

0.25*

Comparatives for the income statement are based on the corresponding figures from 2022. Unless otherwise specified, figures from 31 December 2022 are used as comparatives for balance-sheet and other cross-sectional items.
* Change in ratio.
** The formula for calculating key figures and ratios has been changed as of the beginning of 2023. The item excludes changes in the fair value of loans in hedge accounting as of 1 January 2023. Comparatives have been adjusted to correspond to the current definition.

Outlook for 2024

The economy is expected to decline in early 2024 but decelerating inflation and falling interest rates will pave the way for economic recovery towards the year end. An exceptional degree of uncertainty is still associated with the business environment. Developments in capital markets together with increased geopolitical crises and tensions may abruptly affect the business environment.

A full-year earnings estimate for 2024 will only be provided at Group level in OP Financial Group’s financial statements bulletin and interim and half-year financial reports.

The most significant uncertainties affecting OP Corporate Bank’s earnings performance relate to developments in the business environment, changes in the interest rate and investment environment and to the developments in impairment loss on receivables. In addition, future earnings performance will be affected by the market growth rate and the change in the competitive situation.

Forward-looking statements in this financial statements bulletin expressing the management’s expectations, beliefs, estimates, forecasts, projections and assumptions are based on the current view of the development in the business environment and the financial performance of OP Corporate Bank plc and its various functions, and actual results may differ materially from those expressed in the forward-looking statements.

Time of publication of 2023 reports:

OP Corporate Bank’s Report by the Board of Directors and Financial Statements for 2023

Week 11

OP Corporate Bank’s Corporate Governance Statement 2023

Week 11

Schedule for Interim Reports and Half-year Financial Report in 2024:

Interim Report Q1/2024

8 May 2024

Half-year Financial Report H1/2024

24 July 2024

Interim Report Q1−3/2024

31 October 2024

Helsinki, 7 February 2024

OP Corporate Bank plc

Board of Directors

For additional information, please contact:

Katja Keitaanniemi, Chief Executive Officer, tel. +358 (0)10 252 1387

Lotta Ala-Kulju, Head of Corporate Communications, tel. +358 (0)10 252 8719

DISTRIBUTION
Nasdaq Helsinki Oy
Euronext Dublin (Irish Stock Exchange)
LSE London Stock Exchange
Major media
op.fi

OP Corporate Bank plc is part of OP Financial Group. OP Corporate Bank and OP Mortgage Bank are responsible for OP’s funding in money and capital markets. As laid down in the applicable law, OP Corporate Bank, OP Mortgage Bank and their 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. OP Corporate Bank acts as OP Financial Group’s central bank.

 



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