Outlook
Outlook and risks for 2012
OUTLOOK (UNCHANGED)
Aktia is endeavouring to grow above the market in the sectors focusing on retail customers and small companies.
In 2012, Aktia’s focus is on increasing growth by strengthening customer relations, increasing sales per customer and cross-selling and developing Internet services.
In order to strenghten profitability also costs will be cut, risks and capital will be managed.
In order to strenghten profitability also costs will be cut, risks and capital will be managed.
The interest rate derivatives that temporarily lifted the net interest income (NII) to an exceptional level have matured. The high NII level from 2009-2011 is therefore not possible to repeat in a low interest rate environment.
Write-downs are expected to decrease in 2012.
The operating result for continuing operations 2012 is expected to be lower than in 2011.
RISKS
Aktia’s financial results are affected by many factors, of which the most important are the general economic situation, fluctuations in share prices, interest rates and exchange rates and the competitive situation. Changes in these factors can have an impact on demand for banking, insurance, asset management and real estate agency services.
Change in interest rate level, yield curves and credit margins are hard to predict and can affect Aktia’s interest rate margins and therefore profitability. Aktia is pursuing effective management of interest rate risks.
Any future write-downs of loans in Aktia’s loan portfolio could be due to many factors, the most important of which are the general economic situation, the interest rate level, the level of unemployment and changes in house prices.
The availability of liquidity on the money markets is important for Aktia’s refinancing activities. Like other banks, Aktia relies on deposits from households in order to service some of its liquidity needs.
The market value of Aktia’s financial and other assets can change as a result of a requirement for higher returns among investors, among other things.
The financial crisis has resulted in many new initiatives for regulating banking and insurance businesses, which has brought uncertainty concerning future capital requirements. A change in capital requirements could affect both capitalisation needs and the need for changes in Aktia Group’s structure in the coming years. The results of new regulations are likely to be higher capital requirements, sharpened competition for deposits, higher demands on long-term financing and eventually higher credit margins. (updated 10.5.2012)