Due to our good earnings performance, we will continue offering additional benefits to our owner-customers. OP will pay 40% extra on OP bonuses earned in 2024 and will not charge next year our owner-customers any monthly charges for daily services.
OP Uusimaa key indicators for January–September 2023*:
• OP Uusimaa's earnings before tax for January–June amounted to EUR 179,3 million (64.5).
• Financing operations (loans from own balance sheet and mediated loans) remained unchanged at EUR 16.7 billion.
• Customer assets (deposits, insurance assets, mutual fund units, Profit Shares and index-linked bonds) decreased by 1.8% to EUR 17.9 billion
• At the end of September, the number of owner-customers totalled 358,986, which is 11,459 more than a year earlier. In January–September, 8,664 new owner-customers joined the bank.
• Owner-customers earned EUR 43.9 million in OP bonuses, up by 31.5% year on year.
• The NPS that measures customer experience was good at 75.
• Common Equity Tier 1 (CET1) capital ratio stood at 18.1% on 30 September 2023 (17,1 % December 2022).
• Non-performing exposures accounted for 2.1% of total exposures (1,54 % December 2022).
*The indicators for 2022 in this release are based on pro forma figures and ratios not audited.
OP Uusimaa's market share in home loans strengthened further – upcoming tax changes are expected to invigorate the housing market
OP Uusimaa's market share as a home loan lender strengthened further. OP Uusimaa's share of new home loans granted rose to %13.5, and OP Uusimaa accounts for 10.1% of total home loans in Finland However, new home loans granted were 34.5% lower than a year ago.
- "The mood in the housing market has been dull during the whole year and autumn because of the uncertain economic situation, higher interest rates and the unstable global situation. In addition, chaining of house sales has challenged the housing market", says Olli Lehtilä.
The abolishment of the tax benefit for first-time home buyers proposed by the Government last week has quickly mobilised first-time home buyers. The number of applications received by OP Uusimaa has increased markedly. The number of visitors to OP Koti Uusimaa home viewings have increased substantially.
- "We believe that the upcoming tax changes will invigorate the housing market during the rest of the year. The housing market is now especially favourable for first-time home buyers, as there are a lot of small homes on offer and their prices have fallen the most. In addition, buy-to-let home buyers are not currently actively on the move”, states Olli Lehtilä.
Demand for actual corporate loans has dwindled – housing companies are still applying for basic renovation loans as actively as a year ago
New corporate and institutional loans drawn down were 14.5% lower than a year ago. Housing companies were granted basic renovation loans as many as a year ago but demand for actual corporate loans has decreased significantly: RS loans granted was 36.8% lower than a year ago and actual corporate loans 14.1% lower than a year ago.
OP Uusimaa’s financing portfolio (the loan portfolio in the bank’s balance sheet + mediated loans) remained unchanged year on year, amounting to EUR 16.7 billion at the end of September.
The loan servicing capacity of OP Uusimaa’s customers has remained good
OP Uusimaa's customers significantly benefit from interest rate protection. The net benefit gained by customers from interest rate protection in January–September totalled EUR 24.2 million. Loans with interest rate protection accounted for 32.4% of OP Uusimaa's home loan portfolio at the end of September.
The loan servicing capacity of OP Uusimaa’s customers has remained good. Non-performing exposures remained low, accounting for 2.1% of total exposures. Personal customers’ requests for a change in their repayment plan of home loans have remained at a low level.
- "Expected credit losses applying to the real estate sector and the construction industry are expected to increase during the rest of the year", states Olli Lehtilä.
OP Uusimaa's exposures to the real estate sector and the construction industry accounted for 5.4% of all exposures at period end. In the prevailing market situation, an elevated risk concerns these sectors, as the outlook has become weaker. As a result, expected credit losses applying to the sectors concerned are expected to increase during the rest of the year. Non-performing exposures accounted for 4.8% of these exposures at the end of the reporting period.
Recognition of expected credit losses performed previously on a centralised basis at OP Financial Group level will be targeted to OP cooperative banks during the rest of the year. This is expected to also affect OP Uusimaa's financial result and capital adequacy for the year end.
Asset management net assets inflow among corporate customers EUR 112 million
The deposit portfolio of OP Uusimaa's personal customers totalled EUR 8.2 billion at the end of September.
During the reporting period, OP Uusimaa customers have increased their investment product holdings by EUR 285.1 million in net terms.
The corporate customer deposit portfolio fell by 12.8% year on year.
- " Corporate customers, in particular, have shown interest in investment during the current year, and their net asset management subscription has actually risen to EUR 112 million", says Olli Lehtilä.
Thanks to the good financial performance, the cooperative bank's owner-customers will be awarded
Thanks to the good result, OP cooperative bank customers are this year rewarded with 30% higher OP bonuses. During January–September, OP Uusimaa's customers earned EUR 43.9 million in bonuses.
We announced earlier that owner-customers will get their daily banking services without monthly charges from 1 October 2023 until 31 March 2024.
OP will reward its owner-customers with a range of additional benefits next year too:
- We will pay 40% extra on OP bonuses earned in 2024 and will not charge next year our owner-customers any monthly charges for daily services. The combined value of these benefits for OP Uusimaa customers amounts to around EUR 34 million", says Olli Lehtilä.
Furthermore, we will pay interest of 0.25% on the current account held by over 350,000 OP Uusimaa's owner-customers as of November.