Aktia Bank Plc’s Financial Statement Release January–December 2024: Stable fourth quarter ends a strong year

Aktia Bank Plc
Stock Exchange Release
12 February 2025 at 8.00 a.m.

Aktia Bank Plc’s Financial Statement Release January–December 2024: Stable fourth quarter ends a strong year

The quarter in short

Comparable operating profit: EUR 28.3 million, 11% higher than last year (25.6).
Comparable cost/income ratio 0.59 (0.61).
Comparable return on equity (ROE): 13.1% (13.0%).
Net commission income: 9% higher than last year thanks to a higher net income from asset management.
Assets under management: Decreased during the quarter due to net redemptions and fragmented market development.
Net interest income: Approximately at the same level as last year.
Net income from life insurance: Continued solid development mainly driven by strong demand for investment-linked insurances.
Comparable operating expenses: Good cost control despite continued investments in IT.
Credit losses: Increased compared to last year, which reflects the current market situation.
The share of assets under management classified as sustainable under Article 8/9 increased to 98.1% from 95.3% last year.

Outlook 2025

Aktia’s comparable operating profit for 2025 is expected to be lower than the comparable operating profit for 2024, which amounted to EUR 124.5 million.

The outlook has been prepared based on the following assumptions:

Due to the lower interest rate level, the net interest income is expected to be lower than in 2024.
The net commission income is expected to be slightly higher than in 2024.
The life insurance business is expected to develop steadily. However, the result may be affected by changes in market values.
Operating expenses are expected to increase slightly, given the continued investments in IT and the development of the general cost level.
Credit losses are expected to remain at a moderate level. However, the uncertainty in the Finnish real estate sector may affect the development of impairments and expected credit losses.

Proposed dividend

Aktia's Board of Directors proposes, in accordance with the dividend policy, that a dividend of EUR 0.82 per share to be paid for 2024.

Aleksi Lehtonen, CEO:

In 2024, Aktia successfully fulfilled its purpose of creating wealth in a changing operating environment.

In Finland, the housing market remained sluggish and the challenges of economic growth continued. Capital markets were also affected by geopolitical tensions and falling interest rates. We have worked closely with our customers to ensure that their investment portfolio allocations are right in all market conditions. During the last quarter of the year, large institutional investors made changes in their allocations before the turn of the year, which was also evident in our assets under management.

Stable fourth quarter ends a strong year

The comparable operating profit for the fourth quarter was 11% higher than last year and increased to EUR 28.3 million. It was a good conclusion to a strong financial year performance-wise with one of Aktia’s all-time highest comparable operating profits, EUR 124.5 million. Both the quarter’s and the entire financial year's comparable cost-to-income ratio and comparable return on equity (ROE) thus exceed the current long-term financial objectives. For the full year 2024, we report a strong cost-to-income ratio (0.56) and ROE (15.0%). As the level of our Common Equity Tier 1 capital ratio continues to exceed the target levels, we have reason to be satisfied. Thus, we start the year 2025 on a positive note with a proposed dividend of EUR 0.82 per share.

I am also happy that the quarter showed how long-term, systematic work bears fruit: the results of our employee surveys continued to improve, and Aktia’s result increased the most in the comprehensive, independent EPSI customer satisfaction survey among investors. I am particularly pleased that Aktia was assessed to have the most active dialogue with its customers and that the quality of Aktia’s products and solutions was commended.

I would like to extend many thanks to our customers for placing their confidence in us and to our employees for the high standards of service quality and forward-thinking financial advice we offer.

While the underlying business remained stable, the reported result for the quarter was affected by IT-related impairments and expenses of EUR 26.4 million.

Focus on development of asset management

During the quarter, the development of Aktia's asset management continued. For instance, we launched a new product family of management solutions, combining ETF equity funds with Aktia's spearhead knowledge in fixed income investments and first-class allocation skills. Nevertheless, the total assets under management decreased slightly due to fragmented market development and allocation changes mainly among certain large institutions. However, the net commission income was stable.

The favourable development of the life insurance business continued and the assets under management in investment-linked insurance contracts reached a new record level. With a new cooperation agreement, POP banks are also selling Aktia's investment-linked insurances.

The banking business saw favourable demand during the quarter within our core target groups, although the entire loan book decreased slightly. Also in the current market situation credit losses remained at a moderate level, and the demand for investment solutions was strong among private customers. Thus, the full year 2024 was strong for the banking business performance-wise.

Assessment of Aktia’s strategy

When I assumed the position of CEO, I noted that Aktia has much potential. This thought has guided our work as we have reviewed our strategy in order to ensure our continued wealth-creating journey towards becoming a unique, leading wealth manager empowered by a strong banking heritage. We have sent out invitations to an investor event on 27 February 2025, where we present our specified strategic plan and updated financial targets.

Aktia will celebrate its 200th anniversary next year. By thinking further and striving for growth, we aim to create wealth also far into the future. I welcome all current and future employees, customers, and investors to join us on our journey.

Key Figures

(EUR million)	Q4/2024	Q4/2023	∆ %	Jan–Dec 2024	Jan–Dec 2023	∆ %	Q3/2024	∆ %	Q2/2024	Q1/2024
Net interest income	38.1	38.2	0%	152.0	140.4	8%	36.1	6%	38.8	39.1
Net commission income	32.5	29.8	9%	124.3	120.4	3%	30.9	5%	30.8	30.1
Net income from life insurance	6.3	6.0	4%	30.2	24.1	26%	8.9	-29%	7.4	7.7
Total operating income	78.7	74.5	6%	308.8	287.4	7%	76.1	4%	76.7	77.3
Operating expenses	-49.3	-46.5	6%	-178.6	-176.6	1%	-43.1	14%	-44.8	-41.4
Impairment of tangible and intangible assets	-25.0	-1.1	-	-25.0	-1.3	-	-	-	-	-
Impairment of credits and other commitments	-4.3	-2.4	78%	-10.6	-7.0	53%	-1.8	148%	-1.8	-2.7
Operating profit	0.1	24.5	-100%	94.6	102.6	-8%	31.2	-100%	30.1	33.3
Comparable operating income¹	78.7	74.5	6%	308.8	287.2	8%	76.1	4%	76.7	77.3
Comparable operating expenses¹	-46.1	-45.5	1%	-173.8	-174.2	0%	-42.8	8%	-44.1	-40.7
Comparable operating profit¹	28.3	25.6	11%	124.5	104.8	19%	31.5	-10%	30.8	33.9
Cost-to-income ratio	0.63	0.62	0%	0.58	0.61	-6%	0.57	10%	0.58	0.54
Comparable cost-to-income ratio¹	0.59	0.61	-4%	0.56	0.61	-7%	0.56	4%	0.57	0.53
Earnings per share (EPS), EUR	0.00	0.27	-	1.04	1.12	-7%	0.34	-	0.33	0.38
Comparable earnings per share (EPS), EUR, euro¹	0.31	0.28	8%	1.37	1.15	19%	0.34	-10%	0.34	0.38
Return on equity (ROE), %	-0.1	12.5	-12.6*	11.4	13.3	-1.8*	14.9	-15.0*	14.5	16.5
Comparable return on equity (ROE), %¹	13.1	13.0	0.1*	15.0	13.6	1.5*	15.0	-1.9*	14.9	16.8
Common Equity Tier 1 capital ratio (CET1), %²	12.0	11.3	0.7*	12.0	11.3	0.7*	11.9	0.1*	11.5	11.4
Dividend per share (proposal by the Bord of Directors), EUR				0.82	0.70	17%
Payout ratio (proposal by the Board of Directors), %				79	63	16*

1) Alternative performance measures
2) At the end of the period
* The change is calculated in percentage points

Briefing for analysts, investors and media

Aktia's results briefing for analysts, investors and media will be held in English on Wednesday 12 February 2025 at 10.30 a.m. Aktia's CEO Aleksi Lehtonen and CFO Sakari Järvelä will present the results.

The briefing can be viewed live as a webcast or as a recording after the event at https://aktia.events.inderes.com/q4-report-2024. Questions can be submitted in writing during the live webcast.

AKTIA BANK PLC

For more information:
Oscar Taimitarha, Director, Investor Relations, tel. +358 40 562 2315

Distribution:
Nasdaq Helsinki Ltd
Mass media
www.aktia.com

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 850 people around Finland. Aktia's assets under management (AuM) on 31 December 2024 amounted to EUR 14.0 billion, and the balance sheet total was EUR 11.9 billion. Aktia's shares are listed on Nasdaq Helsinki Ltd (AKTIA). aktia.com.

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