ENP Newswire - 07 February 2014
Release date- 06022014 - OP-Pohjola Group Central Cooperative proposes to Pohjola's Board of Directors on increasing the capital adequacy target and decreasing the dividend payout ratio.
The Executive Board, which acts as the Board of Directors of OP-Pohjola Group Central Cooperative, Pohjola Bank plc's parent institution, has proposed to the Board of Directors of Pohjola Bank plc that Pohjola's capital adequacy target of 11% (CT1) be increased to 15% (CET1). This target must be achieved on a front-loaded basis by the end of 2016.
In order to secure the achievement of the new capital adequacy target, the Executive Board, which acts as the Board of Directors of OP-Pohjola Group Central Cooperative, Pohjola Bank plc's parent institution, has proposed to the Board of Directors of Pohjola Bank plc that Pohjola Group's dividend payout ratio be decreased from 50% to 30% as of dividend distribution for the financial year 2014 until the CET1 ratio reaches the new target.
Pohjola Bank plc shares held by OP-Pohjola Group Central Cooperative account for 61.3% of the votes conferred by all shares.
The proposed higher capital adequacy target results from the tighter regulatory framework, uncertainty related to the treatment of insurance holdings after 2014 and the decision of OP-Pohjola Group Central Cooperative's Supervisory Board of 5 February 2014 to increase the capital adequacy target for OP-Pohjola Group's Banking from 15% (CT1) to 18% (CET1). OP-Pohjola Group must meet the CET1 target, based on the highest-quality form of equity capital (CET1), by the end of 2016. OP-Pohjola Group aims to maintain a solid capital base that creates competitive edge and stability.
On 1 January 2014, OP-Pohjola Group's CET1 was 17.6% and capital adequacy ratio 19.6%. On the same date, Pohjola Group's CET1 was 11.9% and capital adequacy ratio 16.5%.
Pohjola Bank plc's Board of Directors will assess Pohjola Group's financial targets and any measures to achieve them in such a way that the updated financial targets can be confirmed before the Annual General Meeting of 20 March 2014.
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FOR MORE INFORMATION, PLEASE CONTACT:
Vesa Aho, CFO, tel. 010 252 2336
Niina Pullinen, Senior Vice President, Investor Relations, tel. 010 252 4494
Pohjola is a Finnish financial services group which provides its customers with banking, non-life insurance and asset management services. Our mission is to promote the sustainable prosperity, security and well-being of our customers. Profitable growth and an increase in company value form our key objectives. Pohjola Group serves corporate customers in Finland and abroad by providing an extensive range of financial, investment, cash- management and non-life insurance services. We offer non-life insurance and private banking services to private customers. Pohjola Series A shares have been listed on the Large Cap List of the NASDAQ OMX Helsinki since 1989. The number of shareholders totals around 32,000. Pohjola's consolidated earnings before tax came to 473 million euros in 2013 and the balance sheet total amounted to 44 billion euros on 31 December 2013. Pohjola is part of OP-Pohjola Group, the leading financial services group in Finland with 4.3 million customers.